| Abstract: | A prosperous Ethiopia, based on inclusive growth and sustainable
development, is aspiration of all nations, nationalities and peoples in
Ethiopia, as reflected in the preamble of the FDRE constitution. Foreign
direct investment (FDI) in a country can be asserted as one weapon to
actualize this aspiration for sustainable development; yet, FDI may also
causes tragic social, environmental, and human right impacts unless it is
effectively regulated. This paper investigates the nexus between FDI and
Sustainable development in Ethiopia, and suggests effective mechanisms to
mobilize FDI for sustainable development of Ethiopians without
compromising related social, human right and environmental values. To this
end, it employed library based and policy-oriented research utilizing both
primary and secondary sources. The study established quest for inclusive
economic growth, respect for human right, and need to curb social and
environmental impacts of FDI as pressing issues that necessitate the
integration of the economic, social, and environmental pillars of ssustainable
development into FDI administration in Ethiopia. It advocates for sound FDI
administration and policy that equally integrates the economic, social, and
environmental pillars of sustainable development in its regulatory
frameworks and process. In particular, the Government shall ensure respect
for land rights of local community, pay adequate compensation for land
required for FDI, and put in place bilateral investment treaties or clauses in
lease agreements addressing foreign investor’s obligation regarding
performance requirement, benefit sharing, environmental and human rights
standards and impact assessment. It shall also ensure public participation and
consultation with the concerned local community in all decisions to transfer
land to foreign investors and FDI administration. Additionally, the
Government shall establish effective monitoring and dispute resolution
mechanism, and empower the indigenous community and other stake holders
to safeguard rights and interest of local community |
