Investment and Technology Promotion

Economic growth required for eradication of poverty and the achievement of the other associated MDGs depends on capital accumulation (investment) and technical change going hand in hand. Investment in plant and machinery, with its impulse of new ideas and technologies, contributes to productivity growth, as do technological progress, upgrading and diffusion. Foreign direct investment (FDI) in particular is an important driver of industrial performance, as it is expected to improve directly industrial productivity growth by infusing new capital, technologies and managerial know-how, and by improving the average skills and efficiency levels of industry.

Therefore, in order to attain growth, the developing countries and those with economies in transition need to mobilize investment - both domestic and foreign - as well as modern technologies, so as to expand their productive assets and increase their core competencies and competitiveness. However, the flows of investment and technology to developing countries have not materialized to the extent expected. This situation largely reflects the problems arising from government and market failures and weaknesses in institutional capacity, which together make for a business climate not conducive to investment and technology promotion.

The approach of this service module is therefore to address these government and market failures in a systematic manner, so as to alleviate some of the problems faced by the developing countries and those with economies in transition in this area. The services have been designed in such a way as to address the specific needs of these countries according to their respective stage of industrial and technological development.