Countries watch foreign investment as financial crisis looms: UN body

Ahram Online, Thursday 13 Oct 2011

A deepening economic crisis may bring more protective investment policies, says report

The prospect of a looming financial crisis has not yet had an impact on foreign investment policies, despite signs that countries are becoming more concerned about the effect of investment flows, says the UN's trade body.

A report on Wednesday from the United Nations Conference on Trade and Development (UNCTAD) warned that fears over the possibility of a prolonged recession have increased the likelihood of new protectionist measures against foreign investors.
But 2011 has to date seen little sign of such reaction, UNCTAD said.
Between April and September more than 30 economies introduced new investment policies, with the majority -- some 75 per cent -- favouring liberalisation.
Thirty-five countries concluded 24 new international investment agreements, including 17 double taxation treaties, 5 bilateral investment treaties and 2 "other international investment agreements".
Egypt's economic policies have seen few concrete changes in 2011, despite the uprising that overthrew the 30-year regime of former President Hosni Mubarak and led to unprecedented changes elsewhere in the political arena.
However, the recent renationalisation of several state enterprises sold to the private sector during the Mubarak era has raised concerns among foreign investors about the safety of future investments.
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