United Nations Conference on Trade and Development (UNCTAD) recently issued the "World Investment Report in 2010". The theme of the report is "Investing in low-carbon economy."

The report points out multinational companies have been actively investing in low-carbon globally and have reached a fairly large scale. According to the estimation of UNCTAD, in 2009, foreign direct investment only to the three main low-carbon industries (renewable energy, recycling and products manufacturing related with environmental protection technology) reached 90 billion U.S. dollars.

The report states that with the world economy converting to a low carbon economy, the potential of low-carbon investment is unlimited. The participation of multinational corporations and the strategic use of foreign investment will help developing countries and transition economies promote the low carbon economy.

Multinational Companies: Important role in low-carbon investment
The report demonstrates that multinational corporations can make contributions to carbon emission reduction through improving business and production processes and supplying and selling cleaner products and goods. In this process, the multinational companies can provide capital and advanced technology to deal with global climate change.

International low-carbon investment will have a significantly direct impact mainly on energy and industrial sectors. The report points out that transportation, construction, waste management, forestry and agriculture will also benefit from the participation of multinational companies, but in an indirect way.
Developing countries are facing challenges
The report noted that although the developing countries are not the main greenhouse gas emissions, attracting low-carbon foreign investment and technology will bring them more opportunities, mainly in expanding production capacity, improving export competitiveness, slowing down global climate change and accelerating the transition to a low-carbon economy.
The report states that the developing countries will face two challenges in the transition to low-carbon economy. First, to ensure smooth financing, investing in appropriate industries; secondly, researching or acquiring relevant technology.

The report recommends that developing countries should strive to attract foreign investment in low carbon economy. At the same time, they should avoid the potentially negative impacts. For example, they may impose effective industrial and competition policies to solve the crowding-out effect on local businesses and technology-dependence, utilizing social policies to alleviate employment and other social problems and so on.　

As to the issue of "carbon leakage", that is, to transfer greenhouse gas emission facilities to the more relaxed areas of environmental regulation, the report recommended that governments do not need to place this issue between countries to get resolved, such as imposing carbon content tax. Instead, it can be resolved through corporate mechanisms, like the implementation of sound environmental reports and monitoring system.

Establishing Global Partnerships
The report recommended to establish “global partnerships on low-carbon investment” to enable low-carbon investment and dealing with climate change policies complement each other.
According to the report, the partnerships include the following aspects: