A/HRC/33/40 human rights protection while promoting trade. The Parliamentary Conference of WTO in June 2016 demonstrated awareness of the problems. The world expects more than rhetoric. II. Facts about investment protection 5. World trade is expanding continuously. According to figures from the World Bank, world trade reached US$ 19.11 trillion in merchandise exports in 2014. 4 According to WTO, the volume of trade in services in 2014 exceeded $4.87 trillion.5 Tariffs are already low and do not constitute a significant hindrance to trade. There is no need to adopt more “free trade agreements”, which are asymmetrical agreements providing privileges to investors but no enforceable obligations. 6. Over the past decades, the number of bilateral investment treaties and free trade agreements has grown beyond 3,200, following the hard sell and often over-optimistic projections made by trade representatives. The siren call of foreign direct investment (FDI) remains strong. Proponents claim that investment protection treaties are necessary to attract FDI. Lobby groups including the International Chamber of Commerce routinely declare that “strong investment protection standards should be a policy priority for all governments in order to promote new waves of prosperity-enhancing FDI”.6 Yet no compelling empirical evidence backs that up. Of course, some econometric studies contend that the treaties attract investment, but other studies find that they have no effect or a negative impact. 7 In 2015, the European Union Commissioner for Trade, Cecilia Malmström, stated that “the Commission is aware that most studies do not establish a direct and exclusive causal link between the treaties and investment.”8 Brazil gets the lion’s share of FDI in Latin America, yet has not ratified any bilateral investment treaties. South Africa has cancelled a number of bilateral investment treaties (BITs) because, as a government official explained: “South Africa does not receive significant inflows of FDI from many partners with whom we have BITs, and at the same time, continues to receive investments from jurisdictions with which we have no BITs.”9 7. Globally, 696 investor-State dispute settlement cases concerning 107 countries had been counted as at January 2016. 10 Owing to the opacity of the system and the nonpublication of many settlements, the actual figure could be higher. A quarter of the registered cases end in settlement, frequently involving payments or changes in laws and regulations to accommodate investors. However, the ontology of business is risk-taking. Investors who think risk is too high should buy risk insurance or refrain from investing. The State must not guarantee profit to investors. Protection is available through domestic courts. 8. Some 72 per cent of known cases were filed against developing and transition economies. The number of cases against developed countries is growing as foreign 4 5 6 7 8 9 10 GE.16-11938 http://data.worldbank.org/topic/trade. www.wto.org/english/res_e/statis_e/its2015_e/its2015_e.pdf, p. 11. International Chamber of Commerce Austria, “Bilateral investment treaties and investor-State dispute resolution”, 2014. Lauge Poulsen, “The importance of BITs for foreign direct investment and political risk insurance”, in Yearbook on International Investment Law and Policy 2009/2010, Karl P. Sauvant, ed. (New York: Oxford University Press, 2010); Jason Yackee, “Do bilateral investment treaties promote foreign direct investment? Some hints from alternative evidence”, University of Wisconsin Legal Studies Research Paper No. 1114 (22 March 2010). www.europarl.europa.eu/sides/getAllAnswers.do?reference=E-2015-008187&language=EN. Xavier Carim, “International investment agreements and Africa’s structural transformation: a perspective from South Africa”, South Centre Investment Policy Brief No. 4, August 2015, p. 4. http://investmentpolicyhub.unctad.org/News/Hub/Home/504. 3