Economic and Financial Committee

Topic 1: The Question of Foreign Direct Investment

Foreign Direct Investment (FDI) is seen as a catalyst for economic growth. As the world becomes ever more globalized, both countries and businesses are investing in emerging and already developed economies. These relations can positively affect both parties when the goal of working together and global prosperity is strived for.

 The United Nations itself has formal relations with The World Bank which is the world’s largest development institution. It has funded over 12,000 projects to support development and relief since its inception in 1947 and had 77 Billion dollars in commitments for 2020. The World Bank today touches almost every sector of the global economy with the ultimate goal of eradicating poverty. Low interest and traditional loans often allow developing countries to strengthen their economy and cause a boost in the global economy. 

Multilateral corporations often use foreign investment to build manufacturing plants in countries with cheaper labour and lower costs of production. Corporations may also employ global investment to relocate businesses to tax havens. Countries also partake in foreign investment; the United States received 352 trillion dollars in foreign investment in 2019. In developing countries, however, large investments may bring prominent influence in a region. This can be seen as either global investment in a free economy or an act of neo-colonialism as wealthy countries and businesses extend their global reach. 

Loans also need to eventually be paid back and sometimes this is not always possible. Revolution, corruption or economic failure are only some factors that can cause a country to not be able to fulfill its end of a loan. When this happens, countries or businesses may take different measures to have their contract fulfilled. This can include taking resources, power and businesses. All of these allow for countries to expand around the world. John Adams stated that “there are two ways to conquer and enslave a nation. One is by the sword. The other is by debt”.

Thus, the framework for how countries should receive such Foreign Direct Investment while retaining their independence and avoiding risk is a critical issue.

Topics to consider:

  • How should loans be fulfilled when paying back is no longer an option?

  • What is the line between globalization and Neo-colonialism in foreign investment?

  • How to make sure countries do not abuse their power of investment in other countries?

  • Chinese Investment in Africa

 

Sources and Resources for Further Reading:

Topic 2: Addressing the Recovery and Future of Tourism

The COVID-19 virus brought an unprecedented fall in demand to the tourism sector. Everyone from airline companies to hotel owners to accommodation staff were affected. The sector saw an approximate loss of between 100 to 197 million jobs, globally pushing 119-124 million people into poverty as of 2020. 

Tourism involves many aspects of a country’s economy and as recently as 2017, employed 1 in 10 global jobs and accounted for 10.4% of global Gross Domestic Product (GDP). Tourism being such a large sector has caused it to be one of the most impacted by the pandemic. However, this places the sector in a unique position to help restart the global economy, as well as help the countries that rely so heavily on tourism for their GDP.

The United Nations World Tourism Organization (UNWTO) as well as Non-Governmental Organization agencies like the World Travel & Tourism Council (WTTC) have already set out proposals to help restart the tourism sector by focusing on education, investment and innovation. By supporting tourism, the global economy benefits as it employs people from all walks of life. 

The question is, how should the global community implement strategies and global cooperation that allows for travel to rebound? Many nations including the European Union are discussing the use of a so-called “Digital Covid Certificate”, more commonly referred to as a “Covid Passport”. This issue is not only pertinent to the Covid-19 pandemic but future disease outbreaks as well. Making sure to have the groundwork for future global crises for safe travel and keeping the market stable is a critical step to take.

We would also be remiss if we did not take the time to reflect on how to innovate and improve the sustainability of the industry. This is relevant as there are now only 10 years to achieve the Sustainable Development Goals outlined in the 2030 Agenda. We have noted how large the tourism industry is, so affecting how to make the industry more suitable is a pertinent issue. 

The United Nations is responsible to lead the path forward in developing effective plans to help rebuild and innovate the tourism sector, to allow for both sustainability and prosperity for years to come. 

 

Questions to consider:

  • How to best rebuild the tourism sector not only for the present but for the future?

  • What steps can be taken to regain lost momentum to meet the 2030 Sustainable Development Goals?

  • The validity of “Covid Passports” and how their use both now and in the future may affect global tourism.

 

Sources and Resources for Further Reading: