During the last two decades, economies in East Asia and Pacific have been integrating internationally through trade and financial investments. One trend is puzzling.
... See More + Whereas most of the trade integration has been within the region, most of the financial integration has been with countries outside the region. However, a closer examination of investment types shows that therelative lack of regional financial connectivity occurs mostly in equity, bonds, and bank syndicated loans (in so-called arm’s length investments). The region is much more connected through foreign direct investment (FDI) (through both mergers and acquisitions and greenfield investments).
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Growth in global trade has been slow since 2012. While global trade downturns are not unprecedented, the observed change in the relationship of trade to GDP poses the question whether the trade slowdown is a transitory deviation or a more long-lasting phenomenon brought about by structural changes.
... See More + This new dynamic, coupled with the rise of protectionist policies and rhetoric in many countries, positions trade at the forefront of policy discussions. This brief reviews recent patterns in global trade, examines the factors affecting trade—distinguishing between transitory and structural components of the slowdown—and discusses policies shaping the path of future trade.
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The development objective of Polio Eradication Support Project for Nigeria is to assist the recipient (Federal Government of Nigeria (FGN)), as part of a global polio eradication effort, to achieve and sustain at least eighty percent coverage with oral polio vaccine (OPV) immunization in every state in the recipient’s territory, and sustain national routine immunization coverage.
... See More + Some of the negative impacts include: (i) rehabilitation works could possibly involve the removal of vegetation cover in a bid to create work areas; (ii) soil can be contaminated from the spilling of petrol being used by generator sets and vehicles; (iii) air pollution may arise from the indiscriminate open air burning of wastes such as woods, plastics and other wastes generated during the construction and operation phases; (iv) accidental spillage of fuel, lubricants and other chemicals may run-off onto surface waters and eventually into streams; (v) waste generated on site if not managed properly could accumulate, produce foul smells, and attract insects and rodents which inevitably would have health implications on the general public; (vi) construction works such as excavations, working with heavy equipment working in confined spaces, working under noisy conditions, heavy lifting will expose the workers to occupational safety risks; and (vii) waste dumped besides roads may intrude onto the roads causing vehicular hold ups and accidents. Some of the mitigation measures include: (i) ecological restoration through environmental engineering should be undertaken after any human intervention; (ii) soils excavated, lumped and gathered on-site should be covered by impermeable materials; (iii) all waste should be directed to an approved dumpsite; (iv) proper containment of water being used for rehabilitation works; (v) prohibition of access to the work site by any person having no work permits; (vi) there should be a first aid kit at all times on each site; and (vii) ensure proper handling, and disposal of wastes.
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On August 1st 2017, interested parties were invited to provide comments on the discussion draft of a toolkit on the Taxation of Offshore Indirect Transfers.
... See More + This document contains the comments received during the consultation period. The Platform for Collaboration on Tax is grateful to the commentators for their input and now publishes the public comments received.
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How do international economic agreements influence the investment patterns of firms from emerging economies? This paper studies the ways in which bilateral investment treaties and preferential trade agreements interact with geographic and cultural distance to influence firms' investment patterns.
... See More + How does geographic and cultural proximity affect the impact of international economic agreements on foreign direct investment flows? This question is answered using data from an original survey of 700 firms from four emerging (or newly-emerged) economies: Brazil, India, the Republic of Korea, and South Africa. The findings suggest that bilateral investment treaties and preferential trade agreements increase the likelihood of foreign direct investment. Yet, the effects of these agreements on foreign direct investment depend on the distance between the origin and potential destination countries. Moreover, trade and investment agreements appear to interact differently with distance. By providing guarantees to investors and signaling credible commitment from host governments, bilateral investment treaties mitigate the higher uncertainty and transaction costs associated with investing in faraway, unfamiliar markets. By contrast, the investment attraction effectiveness of preferential trade agreements fades with distance.
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Policy Research Working Paper WPS8185 SEP 07, 2017
The report outlines two main approaches for enforcing of taxation of OITs by the country in which the asset is located—provisions for which require careful drafting.
... See More + It identifies the two main approaches for so doing and again provides sample simplified legislative language for domestic law in the location country for both. One of these methods treats such an OIT as a deemed disposal of the underlying asset. The other treats the transfer as being made by the actual seller, offshore, but sources the gain on that transfer within the location country and so enables that the country to tax it. For relative ease of enforceability, and the logic and simplicity of basis adjustment it implies, the report favors the method of deemed disposal.
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The IMF, OECD, UN and World Bank Group established the Platform for Collaboration on Tax (PCT) to intensify their cooperation on tax issues in April 2016.
... See More + The PCT formalizes regular discussions among staff of the four international organizations (IOs) on tax matters, including on cross border issues; analyzes and supports capacity-building to developing countries; and supports joint delivery of guidance on a range of tax issues. It also increases the organizations’ ability to share information on operational and knowledge activities around the world and helps them to use their leverage to bring stakeholders together to take the necessary actions to achieve greater progress. Improved domestic revenue mobilization (DRM) is a core part of the Sustainable Development Goals (SDGs) framework and the Addis Ababa Action Agenda on financing for development. The Addis Agenda stresses the need for assistance to developing countries to improve their capacity to collect both tax and non-tax revenues, and commits to provide international support to developing countries in reaching targets for enhanced domestic revenue. Under the Addis Tax Initiative (ATI), participating providers of international support have each committed to double their technical cooperation in the area of DRM between 2015 and 2020. This note provides an update on the work and plans of the PCT. It provides details only of work that is being done formally as part of the Platform, and does not include activities that Platform Partners undertake under their own mandates, separately or in collaboration with others. The rest of the note is divided in three sections: section two provides an overview of the platform, explaining its main objectives, joint outputs, as its well as funding strategy. Section three describes main activities carried out, and section four highlights the main activities of the Platform planned for the next 12 months.
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As globalization has intensified, multinational enterprises' investments have become a sophisticated set of financial transactions that are difficult to monitor and classify by the home and host countries.
... See More + In some cases, what is classified as foreign direct investment is rather "indirect foreign direct investment," channeled through a third country. Indirect flows have increased significantly in recent years, now accounting for almost 30 percent of global foreign direct investment flows. Indirect foreign direct investment flows also capture the flow of domestic funds channeled through offshore centers back to the local economy in the form of direct investment, also known as "foreign direct investment round tripping." These investments do not offer the benefits of typical foreign direct investment, and may lead to tax revenue and welfare losses. Round tripping is mostly channeled through offshore financial or transshipping centers. In most cases, domestic companies round trip their investments to benefit from preferential treatments reserved for certain countries and their firms. The most important policy measure to reduce round tripping activity and mitigate its impact is to improve the business environment for all firms; this can foster domestic and foreign investment, and may, to some extent, also curb foreign direct investment round tripping. Nevertheless, countries also need to adapt to the new playing field for foreign direct investment, and recognize the trade-offs of their national policies on capital flows. National policy measures must be complemented by international actions. At the same time, all indirect foreign direct investment flows should be closely monitored, something that is best conducted in coordination with international partners.
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Policy Research Working Paper WPS8046 APR 28, 2017
While precise impact of Brexit on the EU/UK trade and investment agreements with third countries will depend primarily on the terms of the withdrawal agreement to be concluded between them, most scenarios suggest an extensive process of amendment of the text and/or commitments in multilateral and bilateral agreements.
... See More + At the multilateral level, the UK will remain a WTO Member, but will no longer be represented by the EU. The separation of the UK obligations from the current EU lists of concessions and schedules of commitments will require amendments that, particularly regarding subsidies and quotas, may lead to a broader renegotiation process requiring consensus of all interested WTO members. At the bilateral level, the status of current EU PTAs with regard to the UK and its trading partners remains uncertain: Some elements suggest that these PTAs may no longer be valid for the UK, or that, even if legally valid, they will no longer cover the relationship between the UK and the third country. Further, EU agreements focusing on goods only will no longer apply to the UK. For these agreements to continue to apply, the UK and the third country will need to amend some aspects of the text of the agreement as well as of the lists of commitments. Investment treaties concluded by the UK with third countries will remain valid, and no amendment is in principle necessary. Parties could require amendments to the text of the treaty, due to a fundamental change in circumstances. LDCs and developing countries who benefit from the EU GSP will continue under this regime for the remaining EU member, but that GSP framework will no longer be applicable to the UK. The UK may introduce a new GSP regime of its own. In all cases, third countries who consider that Brexit has diminished the value of their negotiated commitments have the opportunity to request compensation in sectoral commitments or changes in the text of the agreements, or ultimately terminate the agreement The process of amending the trade and investment agreements requires comprehensive knowledge of their trade and investment flows with the EU and the UK.
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Policy Research Working Paper WPS8010 MAR 20, 2017
This study combines macro and micro data to quantify the revenue effects of double tax treaties. First, drawing on administrative information, the study estimates the tax sensitivity of income flows (dividend, interest, and royalty payments) at an aggregate level.
... See More + The analysis finds important direct revenue costs linked to treaty restrictions on taxing rights, especially for flows into a few major investment hubs. However, high elasticities of income flows also suggest that increases in withholding rates at the individual treaty partner level would not necessarily result in more revenue collection. Second, the study uses firm-level information to estimate the sensitivity of reported profitability to changes in the relevant treaty network. The analysis of the reported earnings of multinational enterprise affiliates in Ukraine suggests that the ownership structure and operations with affiliates in certain jurisdictions explain reported profitability, and should thus receive increased attention in risk assessment and transfer pricing audit activities.
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Policy Research Working Paper WPS7982 FEB 27, 2017
Albania’s authorized economic operators (AEO) program is not yet operational, even though the country has adopted the necessary European Union (EU) legal and regulatory frameworks.
... See More + This smart lesson outlines shortcomings in the adoption of AEO provisions under the European community customs code (CCC) as well as the obstacles the national government has faced putting in place the complementary reform measures necessary to ensure practical effectiveness. Lessons learned from the Albanian experience may be instructive for other countries in the central European free trade agreement region as they look to operationalize their AEO programs without diverting from AEO guidelines as set out in the EU acquis.
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Quality education is a critical dimension for the achievement of sustainable development. The renewed political commitment set out in sustainable development goal 4 (SDG4) is an opportunity to ensure strong coherence between education policy and the right to education first articulated more than 70 years ago.
... See More + This paper presents the results of a desk-based study on a human rights-based approach to education (HRBAE) in the context of SDG4. It explores the ways in which such an approach can guide policy, planning, and the delivery of education in observance with agreed international frameworks providing for the right to education. The paper argues that the human rights conventions on the right to education are not passive instruments designed to remain only at the level of discourse but, as legal obligations, require action from the state and should be central in the development of education services, including in the context of large scale displacement and crisis. This paper outlines the legally binding commitments of the right to education. It considers how these can be applied practically through a HRBA-E to address the continuing barriers to access and completion of quality education and learning. The paper is structured in four sections that examine: (1) the promise of education and the scale of unfulfilled obligations; (2) the conceptual roots of a human-rights approach and its application to education; (3) how a HRBA-E is central to issues critical for the achievement of SDG4, such as learning, equity, and financing; and (4) the issue of accountability: the World Bank and human rights, final reflections on a HBRA-E and SDG4.
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Climate-driven water variability is a natural phenomenon observed across river basins, but predicted to increase due to climate change. Environmental change of this kind may aggravate political tensions, especially in regions that are not equipped with an appropriate institutional apparatus.
... See More + This paper argues that attempts to assess the ability of states to deal with variability in the future rests with considering how river basins with agreements have fared in the past. The paper investigates whether basins governed by treaties witness less tension (and by extension more cooperation) over shared water in comparison with those basins not governed by treaties, using the 1948-2008 country dyads event data from the Basins at Risk project. The results provide evidence to suggest that the presence of a treaty promotes cooperation. Furthermore, the number of agreements between riparian countries has a significant positive effect on cooperation, which is robust across different specifications controlling for a broad set of climatic, geographic, political, and economic variables.
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Policy Research Working Paper WPS7855 OCT 11, 2016
Dinar,Shlomi; Katz,David; De Stefano,Lucia; Blankespoor,BrianDisclosed
The first International Centre for Settlement of Investment Disputes (ICSID) briefing for embassy representatives was held in Washington, D.C. in September 2015, updating local representatives on ICSID operations and developing further communication with Member States.
... See More + ICSID now has 15 institutional agreements with other international arbitral institutions, with 2 new agreements concluded in FY2016. The center concluded 51 cases in the past year, demonstrating that its efforts to expedite the arbitral process are having an impact on the duration of individual cases. ICSID has a staff of close to 70 professionals. More than half of ICSID staff are lawyers trained in various civil and common law jurisdictions. The members of the Secretariat speak more than 20 languages in addition to the Centre’s official languages, English, French and Spanish. In FY2016, 147 hearings were held, continuing a five-year trend of holding more than 100 hearings a year in ICSID cases.
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This report reflects significant changes in European Union (EU) corporate financial reporting since 2011. In June 2013, a new accounting directive was adopted, replacing the fourth and seventh directives on company law.
... See More + A directive amending the 2006 audit directive and a new audit regulation addressing oversight of the most significant audits were adopted in April 2014. The new legislation, summarized in this guide, is a result of several years of drafting and discussions following the financial crisis of 2008 and it represent a landmark in the EU’s efforts to strengthen its corporate sector accounting and auditing. The accounting directive seeks to enhance the quality of financial reporting and expand it, especially with regard to public interest entities, while reducing the administrative burden for smaller companies. The new audit reporting requirements introduced by the regulation are expected to increase the usefulness of statutory audits of public interest entities, such as listed companies, credit institutions, and insurance undertakings, and reduce risks of excessive familiarity between statutory auditors and their clients, encourage professional skepticism, and limit conflicts of interest. The audit directive and the regulation will bring more consistency in audit oversight and quality assurance systems across Europe. Implementation will involve significant challenges and require increased resources to ensure systems function effectively.
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This guide is designed to ensure that a comprehensive overview of the relevant provisions of the acquis communautaire is available to policymakers, regulators, and other stakeholders in countries with a European vocation or those simply wishing to take the European Union (EU) regulatory model into account when devising their own national approaches.
... See More + This guide outlines and summarizes the EU legislative framework governing corporate sector accounting and auditing. It is primarily intended for an audience with little prior knowledge of the EU. Consequently, rather than delving directly into the issues of accounting and auditing, the guide begins by giving a brief history and overview of the EU, its institutions and legislative processes in section one. In section two, the guide focuses on the development of the internal market, particularly in the areas of financial market integration and company law harmonization. Section three addresses the harmonization of accounting and auditing in the EU. Section four looks at the most pressing accounting and auditing issues for the EU.
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This guide is designed to ensure that a comprehensive overview of the relevant provisions of the acquis communautaire is available to policymakers, regulators, and other stakeholders in countries with a European vocation or those simply wishing to take the European Union (EU) regulatory model into account when devising their own national approaches.
... See More + This guide outlines and summarizes the EU legislative framework governing corporate sector accounting and auditing. The guide begins by giving a brief history and overview of the EU, its institutions, and legislative processes in section one. In section two, the guide focuses on the development of the internal market, particularly in the areas of financial market integration and company law harmonization. Section three addresses the harmonization of accounting and auditing in the EU. Section four looks at the most pressing accounting and auditing issues for the EU.
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Global debate over alternative approaches to governing the internet has been wide ranging, but increasingly has pivoted around the wisdom of multistakeholder governance.
... See More + This paper takes controversy around a multistakeholder versus an alternative multilateral approach as a focus for clarifying the changing context and significance of internet governance. A critical perspective on this debate challenges some of the conventional wisdom marshaled around positions on the history and future of internet governance. By providing an understanding of the dynamics of internet governance, this paper seeks to illuminate and engage with issues that are of rising importance to the vitality of a global infrastructure that is becoming more central to economic and social development around the world. Based on the perspective developed in this paper, a multistakeholder process appears best suited for helping a widening array of actors, including multilateral organizations, to connect a worldwide ecology of choices that are governing the internet.
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