The Multilateral Agreement on Investment, known as the MAI, is being negotiated under the auspices of the Organisation for Economic Co-operation and Development — the OECD — in Paris. It is intended to be a free-standing international treaty open to all countries willing and able to meet its obligations.
The state of play in the MAI negotiations and the Government's general approach and position on specific issues, including those raised by the Deputy in his question, were set out in the replies to parliamentary questions on 21 April 1998 and 12 May 1998.
In short, based on the negotiations to date, the Government supports the conclusion of the MAI and expects that this country would in due course become a party to it. As a small country with a high dependence on trade and foreign investment, we tend to favour a multilateral approach to dealing with regulatory issues that involve government. A rule-bound system, such as the World Trade Organisation, WTO, offers in the case of trade, is, therefore, something we welcome. As the OECD is the only active forum for the negotiation of international investment rules, it is natural for us to support the MAI negotiations.
The Government would have preferred if these negotiations could have been conducted in the WTO with the active participation of developing countries who form the majority in that organisation. As developing countries are not at present willing to engage in multilateral investment negotiations, this option was not available. The Government fully respects the right of each developing country to choose what it considers best for itself in this area, although Ireland's own experience demonstrates how an open foreign investment regime can be a key factor in economic development.
In relation to human rights and the environment, including the protection of natural resources, Ireland has argued in favour of a binding obligation not to lower labour or environment standards in order to attract or retain a particular investment. There is a growing consensus in the negotiations for the inclusion of such provisions. The right of contracting parties to take action against companies which fail to comply with nondiscriminatory national laws in these areas is not affected by the provisions of the draft MAI.
