OVERVIEW: This exercise is designed to serve as a concrete basis for discussion of the choices faced by developing countries in designing a foreign direct investment strategy. It highlights the obstacles and opportunities presented by the imperative to integrate – and strike a balance among – the three pillars of sustainable development: economy, society, and environment.

THE SCENARIO: The hypothetical nation of Mandoa faces many challenges typical of developing countries today: an economy based largely on the export of agricultural products affected by declining terms of trade, rural poverty leading to mass migration to urban areas, an impending health crisis related to the spread of HIV/AIDS, and environmental deterioration. A large multinational corporation, ACOM, is proposing to invest in two large projects: an aluminum smelting plant located in Mandoa’s capital, Chimbesi, and an inland dam that will provide sufficient energy to the industrial complex as well as other users. Mandoa’s government needs to make a decision as to whether and under what conditions and constraints, if any, it will allow ACOM to operate.

The exercise is conducted in groups of seven, including two Ministers of Trade and Industry, two Ministers of the Environment, two Ministers of Social Development, and a Prime Minister who facilitates the discussion and makes the ultimate decision regarding the terms and conditions of any foreign direct investment.

Potential debriefing topics include consensus-building techniques within a political context, the role of the facilitator/decisionmaker, and the tensions between more efficient vs. more inclusive decisionmaking.

Participant roles include:

• General Instructions
• Confidential Instructions for:


• The Minister of Trade and Industry (including the ICC Business Charter for Sustainable Development)
• The Minister of the Environment (including the Dow Jones Sustainability Group Index)
• The Minister of Social Development (including the OECD Guidelines for Multinational Enterprises)

Teacher's package includes:

• All of the above
• Teaching note