(b) In order to establish accountability, the Investment Management Service should either (i) ensure that the fixed income investment officer acts with greater independence in the management of the portfolio or (ii) consider outsourcing the fixed income portfolio while maintaining the investment officer to monitor the performance of the outsourced portfolio (AS2003 801 02 011)

Portfolio management

In this regard, UNCTAD was encouraged to offer greater support to the OECD NEPAD Investment Initiative to improve the investment climate in African countries so as to promote both domestic and foreign direct investment.

UNCTAD apos s experience in the area of FDI should also be used to discuss the proposals for a multilateral investment agreement, in cooperation with other international organizations such as WTO and OECD.

39. Of the three forms of private capital flow (loans, FDI and portfolio equity), FDI and portfolio equity investments are more relevant in the present context of African economies.

With this background, Deloitte and Touche, the consulting company, reviewed the current practices as regards the Fund's investments and has recommended a fundamental change of the investment alignment. The recommendations include

By realigning the Fund's investment, infrastructure and team configuration, a number of the audit recommendations made to the Investment Management Service in the past few years can be implemented.

3. The Investment Management Service has two in house systems (a) a Portfolio Management System, which was installed in 1993 and (b) the Investment Control and Accounting System, which provides automated accounting for the transaction activities of the investments of the Pension Fund.

UNCTAD had been granted observer status in OECD's Investment Committee.

Under investment cost, the Secretary Chief Executive Officer explained that the additional resources requested were directly linked to the recommendations made in the report of Deloitte and Touche on the investment process, operations and organization of the Investment Management Service.

In the area of investment promotion, UNIDO and UNCTAD were the joint hosts for an international conference on privatization and investment held in Geneva in which 200 businessmen participated along with Uzbek government officials.

They had brought with them 100 trade and investment proposals, negotiated commercial deals and identified trade prospects as well as joint venture investment projects.

Implementation of the recommendations on bribery in international business transactions Report of the Organisation for Economic Co operation and Development (OECD) Committee on International Investment and Multinational Enterprises (CIME) to the 1996 meeting of the OECD Council at the ministerial level.

(b) Regional investment programme for ECO member countries.

40. The spokesman for the African Group (Morocco) said that his Group supported the recommendations of the Expert Meeting, as they represented elements of a package which would help improve the environment for attracting increased FDI.

New investment...

Recognizing that outward promotion functions are often shared among multiple home country institutions, the experts suggested that lead organizations dealing with outward investment promotion in OECD member countries, as well as in other countries, be identified.

(d) Alternative investments offer the opportunity for an enhanced risk return profile for a pension investment portfolio.

There are encouraging signs of growing investor interest in African securities portfolios.

2. Subsequently, in its agreed recommendations, the Expert Meeting on Competition Law and Policy (November 1996) recommended to the Commission on Investment, Technology and Related Financial Issues, which endorsed the recommendation, that the UNCTAD secretariat be requested

The main thrust of the report was to recommend a new hybrid structure for the Service, in which a combination of internal management and permanent temporary external outsourcing of the management of the Fund's investments would be used.

Discussions had been held on issues such as a possible multilateral framework on investment and its development dimension, export processing zones, targeting investors, locational decisions of investors, outward investment promotion measures and investment incentives.

UNCTAD and UNIDO are jointly assisting the Uzbek Foreign Investment Agency at present.

The measures suggested by the IPR have been incorporated into the five year strategic plan of the Ghana Investment Promotion Centre (GIPC), and many of them have already been implemented.

Or the deposits can be investments in D.E. Shaw s funds and the loans can be the complex derivatives that make up D.E. Shaw s portfolio.

Figure 18 Cost of management of the Fund's portfolio by the Investment Management Service

In Asia, in the framework of the ASEAN UNCTAD Joint Events on FDI Data and Policy Issues, UNCTAD continued to act as an adviser and resource to the ASEAN Working Group on Foreign Direct Investment Statistics, which met in 2004, and assisted the ASEAN Secretariat in producing the publication entitled Statistics of Foreign Direct Investment in ASEAN 2004.

27. There are three main categories of private resource flow loans, foreign direct investment (FDI), and portfolio equity investment.

The Kenya UNDP UNDAF project formulated an integrated technical assistance programme for Kenya, which included an Investment Policy Review (IPR), an investment promotion strategy based on the recommendations contained in the IPR, and capacity building interventions, including training for investment promotion centres, as well as a technology policy review (see para. 77 below).

Some experts suggested that investment in national green funds in OECD countries which are tax free may be another mechanism for promoting investment in sustainable development projects in developing countries.

It has created 200 jobs, 20 per cent of them for women.

In its report the team advised that a new one is necessary and recommended that it should be built at UNU INRA.

(d) In view of the size and diversification of the investment portfolio, the Investment Management Service should increase the number of investment managers or review the possibility of hiring additional discretionary investment advisers (AS2001 95 1 14)

With regard to investment promotion, Egypt has adopted UNCTAD's recommendation that GAFI be transformed from a control authority into an investment promoter and facilitator.

Source OECD, Promoting Foreign Direct Investment in Developing Countries (Paris OECD, 1993).

Cooperation has been extended to investment guides for LDCs, and investment policy reviews have been conducted jointly.

Board of Directors, Nozala Investments (women apos s component of National Economic Initiative).

Expert Meeting on Capacity Building in the Area of FDI

31. In addition, to enable investors to minimize their risks and to diversify their portfolios, there is a need to widen the investment sphere. This requires assisting the MFIs which are potentially eligible for this kind of investment in making their case vis à vis potential investors.

In response to a delegation's query about the possible overlap or complementarity of OECD's and UNCTAD's work, it was pointed out that OECD utilized a broader perspective in focusing on investment policy, whereas UNCTAD focused more specifically on FDI.

Recommendation The secretariat should continue the preparation of IPRs and strengthen the process for the implementation of the recommendations.

At its last session, the Board recommended that the secretariat be more proactive in identifying organizations in developing countries that could be eligible for funding.

10. In addition, an ESCAP project on strengthening subregional economic cooperation in trade and investment among the south western States members of the Commission, aims to assist ECO countries in exploiting new trade and investment opportunities provided by the progressive development of physical infrastructure in the ECO region.

Large investors diversify their asset portfolio in order to optimize their risk return ratio.

Under those circumstances, the Secretary General had recommended against investing funds in guided tours at the United Nations Office at Nairobi.