Human Rights and Foreign Direct Investments

3 Introduction. The linkage between human rights and poverty reduction is recognized as a central issue by international organization such as the United Nation, the International Monetary fund and the World Bank. Social justice and economic growth are tightly connected and where human rights are at the centre of governance there can be real progress in combating poverty. Societies that value and empower all individuals make the most also in terms of economic growth. States that respect the rights of individuals and enjoy the rule of law make the most reliable and fruitful trading partners. Over the past ten years, human rights organisations have grown increasingly concerned about international trade agreements, the provisions they contain and the potential effect of menacing human rights protection. This concern has been driven by dozens of documented violations resulting from unregulated corporate activity in some parts of the world 1 ; dispute settlements decisions that have a negative impact on policies related to rights protection; powerful intellectual property rights regime that compromise people’s access to medicine, control of resources and the access to technology; agricultural trade that has resulted in subsidised imports destroying livelihoods of subsistence farmers; and ongoing liberalisation of services that many fear threaten public policies which favour universal and non- discriminatory access to health, education, water and other social services. One of the main, or most impressive, reasons for concentrating in foreign direct investments while talking of human rights stands essentially in quantitative reasons. In 2001, the net flow of foreign direct investments to developing countries was $205 billion, out of $735 billion in all countries (about 28% of the total) 2 , a figure which dwarfs official development assistance, $53 billion in 2002 3 . Investments rules are being currently renegotiated in several different occasions, mainly bilateral initiatives, as well as in the New Partnership for African Development (NEPAD), the Free Trade Areas of the Americas (FTAA) and in the World Trade Organisation. The concern on the investments rules and the necessity to reform them it is very spread and it reaches international agencies such the World Bank, the UN Conference on Trade and Development, 1 ITT played a role in overthrowing the popularly elected Allende government in Chile; United Fruit helped mastermind a governmental overthrown in Guatemala; U.S. Mining and Oil companies forged cozy relationship with dictatorial regimes across Africa. 2 UNCTAD, “World Investments Report 2002” Overview, p.9. 3 J. Randel, T. German and D. Ewing “The Reality of AID” 2002, Manila, IBON Foundation, 2002, p 145.