VZCZCXRO3313
RR RUEHAG RUEHBZ RUEHGI RUEHMR RUEHPA RUEHPB RUEHPOD
DE RUEHGV #0262 0890600
ZNR UUUUU ZZH
R 300600Z MAR 09
FM USMISSION GENEVA
TO RUEHC/SECSTATE WASHDC 8217
INFO RUCNWTO/WORLD TRADE ORGANIZATION COLLECTIVE
RUCNDT/USMISSION USUN NEW YORK 2992
RUEHBS/USEU BRUSSELS

UNCLAS GENEVA 000262 
 
SIPDIS 
 
STATE FOR IO/EDA AND EB/IFD/OIA 
USUN for JLAWRENCE 
 
E.O. 12958: N/A 
TAGS: EINV ECON UNCTAD
SUBJECT: UNCTAD INVESTMENT DATABASES - MONITORING TRENDS GLOBALLY IN 
DIRECT FOREIGN INVESTMENT 
 
¶1. Summary: The United Nations Conference on Trade and Development 
(UNCTAD) includes a 90 person division devoted to research on direct 
foreign investment and the operations of transnational corporations 
(TNC).  The Division's annual flagship report, the World Investment 
Report, is one of the most comprehensive sources for comparable 
country data on investment: flows, policies, and agreements and for 
comparable data on TNC operations by country and sector. End 
summary. 
 
DATABASES 
--------- 
¶2. UNCTAD's Investment Division, with 90 staff members, monitors 
worldwide statistics and trends concerning direct foreign investment 
and the operations of transnational corporations.  Twenty five of 
the division's staff maintain and update the division's four unique 
databases which contain comparable country data for the 192 UN 
member states, plus economies such as Hong Kong, Taiwan, and the 
Cayman Islands.  The first database contains information on foreign 
investment flows tracking inward and outward investment by industry 
and country.  The second database contains information on TNC 
operations tracking firm level employment, tax revenues, sales, 
exports, etc., by country and industry.  The third database contains 
information on foreign investment policies.  The final database 
contains information on investment agreements (there are over 5,000) 
and investor-state disputes. 
 
¶3.  According to James Zhan, Officer in Charge of the Investment 
Division, the barrier to entry for this type of data collection and 
analysis is extremely high.  UNCTAD has been doing research and 
analysis focused on direct foreign investment and TNCs for more than 
thirty years, and has a well established focal point for data 
collection in every country and economy. 
 
¶4. Data is collected by UNCTAD in accordance with each country's 
financial reporting practices.  UNCTAD staff then process the data 
according to international standards, to make it comparable across 
countries and sectors.  This effort requires great expertise and 
familiarity with each country's data. For example, regarding outward 
investment from China, the Chinese Foreign Exchange Bureau and 
Chinese Ministry of Commerce collect different data.  UNCTAD must 
consolidate and verify that data and then compare it with the EU and 
US inflow data to determine if the amounts are accurate.  After 
UNCTAD does this analysis, it provides the statistics back to the 
GOC, which revises its official data to match the UNCTAD data. 
Across developing countries the treatment of inter-firm loans, 
reinvested earnings and equity flows, differs and must be accounted 
for to make the data comparable.  UNCTAD has a team of twenty staff 
writing the annual World Investment Report.  Through their research 
and analysis, they provide an additional source to confirm or 
correct the UNCTAD data. 
 
WORLD INVESTMENT REPORT 
----------------------- 
¶5. UNCTAD has been producing the World Investment Report since 1991. 
 That report, drawing on UNCTAD's databases, analyzes trends in 
direct foreign investment and operations of TNCs. Unlike the 
Globalization division in UNCTAD, which has a mandate to be 
independent and "ahead of the curve," which it often flaunts in its 
provocative flagship "Trade and Development Report," the Investment 
Division aims to be mainstream and to define consensus views on 
investment policy. 
 
COOPERATION WITH OECD 
--------------------- 
¶6.  In June 2007, Heads of State and Government meeting at the G8 
Summit in Heiligendamm, Germany, invited UNCTAD and the OECD to 
jointly engage industrialized countries, emerging economies and 
developing countries in the development of best practices for 
creating an institutional environment conducive to increased foreign 
investment and sustainable development.  UNCTAD's investment 
division regularly works with OECD counterparts on a variety of 
issues such as enterprise development, entrepreneurship and the 
global value chain. 
STORELLA