Better Rules for a Better Future: Regulating private sector agriculture | Association Of Southeast Asian Nations | Foreign Direct Investment

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In various communities across Southeast Asia, the unregulated influx of large-scale private agricultural investments has led to land grabbing, food insecurity and environmental degradation. Women, who are primarily responsible for putting food on the table, are especially affected by these problems. These challenges can be expected to increase as the Association of Southeast Asian Nations (ASEAN) moves towards greater investment liberalization to attract private sector investors into the region. Oxfam calls on ASEAN to adopt an agreement that will bind its 10 Member States to implement a common set of policies that will safeguard the rights, welfare and interest of people amidst the entry of these investments.
  OXFAM BRIEFING PAPERNOVEMBER 2012 Better Rules for a Better Future Regulating Private Sector Agricultural Investments in ASEAN ASEAN believes in the potential of private sector to contribute to its goal of becoming, by 2015, a single regional economic community that is closely linked to the global economy. Hence, the most binding and progressive aspects of ASEAN investment policies are those that move its Members towards greater investment liberalization and investor protection. However, all across Southeast Asia, the unregulated inux of private sector investments in agriculture is creating problems for many poor communities. It is high time that ASEAN adopts a regional agreement that will encourage its Members to regulate agricultural companies and their operations, as well as support and safeguard people and communities. Like rice seedlings ready for planting, advocacy “seeds” should be planted to have better rules and regulations on private sector agricultural investments and to ensure that farmers’ rights are upheld and protected. Photo: Abbie Trayler-Smith/Oxfam  3 SUMMARY The ASEAN Investment Report for 2011 considers 2010 as an   important year for the region in tems f fein diect investment (FDI) inws. FDIs in ASEAN f the said ea eached a ecd hih f US 75.8 millin dllas, neal duble the inws in 2009. Included in these FDIs were private sector investments in agriculture, as Southeast Asia has become one of the most favored destinations of large-scale agricultural land investments.  ASEAN believes in the potential of private sector to contribute to its goal of becoming, by 2015, a single regional economic community that is closely linked to the global economy.The most binding and progressive aspects of ASEAN investment policies are those that move its Members towards greater investment liberalization and investor ptectin. In 2009, the einal blc passed the ASEAN Cmpehensive Investment  Aeement (ACIA), which allwed eate investment libealizatin and hihe levels f protection for investors in the region, including in crucial sectors such as agriculture.  ASEAN entered into various investment cooperation agreements and arrangements with the cunties, especiall with its “plus thee patnes” in Asia, namel China, Suth Kea and Japan. Still in 2009, ASEAN sined sepaate investment libealizatin accds with China and Kea, while in 2008, it had adpted the ASEAN-Japan Ecnmic Patneship  Aeement. All these aeements facilitated investment ws amn the sinat countries and ensured the protection of investors within their respective territories.Previously, in 2003, ASEAN had also signed the ASEAN India Framework Agreement n Cmpehensive Ecnmic Cpeatin, which pvided the basis f establishin the  ASEAN-India Regional Trade and Investment Area (RTIA). In 2008, it adopted the ASEAN  Australia New Zealand Free Trade Agreement, which like ASEAN’s other accords, included provisions designed to encourage investments. It also has a Trade and Investment Framework Agreement with the United States, and is presently working to revive region-to-region talks with EU, after negotiations on the ASEAN-EU Free Trade Agreement came to a standstill in 2009. However, while ASEAN is moving towards greater investment liberalization and protection in its quest to attract private sector investors into the region, it has yet to develop regional policies that will regulate investments in a way that will safeguard the interest and rights of its peoples and communities. In various communities across Southeast Asia, the uneulated inux f lae-scale pivate aicultual investments has been ceatin pblems f man p peple, amn them small men and wmen fames, shes and food producers.Various studies document the negative impacts of unregulated private sector agricultural investments. These include the displacement of small men and women farmers and rural poor communities from their land to give way to the operations of private companies; food insecurity arising from the conversion of farmlands to plantations for exports and biofuels; the negative effects of unequal bargaining leverage on farmers’ welfare; and environmental degradation. Women, who take the lead in managing the household and ensuring food on the table for the whole family, are especially affected by these problems.  4  ASEAN’s passae f its Chate in 2007 pvided it with the mandate t pusue the development of a regional agreement to regulate private sector agricultural investments. The Chate afmed ASEAN’s ln-standin peatin pinciple f nn-intefeence in the internal affairs of its members and respect for their sovereignty. However, it balanced this principle with the recognition that Members should shape their domestic regulations in a way that will support ASEAN’s goal of becoming a politically cohesive, economically inteated and sciall espnsive sinle ASEAN cmmunit b 2015. The Chate specicall pvides f Membes’ adheence t the pinciples f d venance and respect for and protection of human rights and fundamental freedoms. It places the well-being, livelihood and welfare of the peoples at the center of the ASEAN community-building process.  ASEAN and its Membe States can benet fm adptin and implementin a einal agreement to promote sustainable investments. First, such a regional agreement can help promote the upward harmonization of good investment policies while discouraging a race-to-the-bottom approach in attracting investors among ASEAN Member States. Second, it will open up opportunities for ASEAN Members to learn from and support each other in developing national capabilities and best practices in promoting and adopting investment policies that are not only good for investors but for peoples and communities as well. Third, this can help ASEAN ensure the long-term viability and sustainability of its vision of an economically integrated regional community by 2015. The social backlash arising from the negative impacts of unregulated developments highlights the political and social challenges in building a single ASEAN community with harmonized economic policies, but which do not anticipate and address the possible impacts of private sector agricultural investments on people and communities. ASEAN need not start from scratch in developing regional regulations on private sector agricultural investments. There exists a host of global standards and guidelines on private sector investments that can serve as initial bases for developing better and more effective regional rules on the same. These include the Food and Agriculture Organization’s Voluntary Guidelines on Responsible Governance of Tenure of Land Fisheries and Forests, the Ruggie Guiding Principles on Business and Human Rights, the United Nation’s Global Cmpact, amn man thes.  ASEAN should forge a regional accord that will move its 10 member countries to adopt and effectively implement the following key policies. 1. Ensure that the principle of free, prior and informed consent (FPIC) is followed in deciding whether or not an agribusiness project should push through.2. Introduce policies to protect national food security.3. Develop and enforce regional standards and regulations for fair and equitable contracts.4. Develop and enforce commonregional standards for publicly disclosed full-impact assessment via multi-stakeholder processes. 5. Strengthen mechanism through which peoples and communities can le complaints as well as seek and access remedy.
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