Concluding fair and stable investment contracts

Project description

Title: (Global Project) CONNEX Support Unit
Commissioned by: German Federal Ministry for Economic Cooperation and Development (BMZ)
Country: Global
Lead executing agency: Government institutions and structures involved in contract negotiations (responsible line ministries, ministries of finance, presidential offices)
Overall term: 2017 to 2024

Context

The extractive sector offers major opportunities for the economic and social development of resource-rich countries. The governments of these countries are faced with the challenge of maximising the benefits for the state, safeguarding the interests of their population and at the same time attracting investment. In recent years it has become increasingly evident that socially and ecologically responsible mining is possible, while at the same time being attractive to investors. Due to often inadequate legislation and regulatory framework implementation, negotiations of investment contracts are of particular importance. Partner countries often do not have the necessary capacities to negotiate with investors on an equal footing. In many cases contracts are concluded that fail to realise their economic potential, cause financial disadvantages, have little development impact and show deficits in implementation.

Objective

Developing countries and emerging economies are able to conclude fair and stable investment contracts in the areas of mining, infrastructure and renewable energy, and increase the associated developmental benefits.

Approach

The CONNEX Support Unit has already successfully established itself as a service provider for contract negotiations. It is now focusing on sustainably strengthening institutional structures, intensifying its support measures, further developing its range of services and expanding the services to include the areas of infrastructure and renewable energy.

The project supports partner countries in negotiating contracts with investors in the areas of mining, infrastructure and renewable energy. At governmental request, CONNEX provides experts from multiple disciplines who support local negotiation teams on a short-term basis in the negotiation of investment contracts. In this way, procedures, structures and strategies for coordinated negotiations with a successful conclusion are anchored in the respective governments.

Last update: June 2021