[PASSED] WA Development Foundation

[Glen-Rhodes]

We have both accepted that nothing has a 100% success rate, excellent. So, with that logic, you're accepting that at some point a mistake will be made. My concern is that mistake could be economically disastrous and the integrity and reputation of the World Assembly would be damaged. And even in the event that it's not a total catastrophe, the World Assembly would, at the very least, have its credibility damaged.

We disagree that the likelihood of this happening is anywhere near high enough to warrant never setting up the Development Fund. All financial institutions face difficulties during economic crises. The fact is, however, that economic crises are less destructive because of these institutions. It is cowardice to quiver at the thought that the World Assembly might be taking some indirect financial risk or credibility risk. The benefits of maintaining a lender of last result of developing states far outweigh any probable costs.

Furthermore, the World Assembly is not a business. It is an intergovernmental organization. The money used by this Development Foundation would be backed by the full faith and credit of sovereign states. The World Assembly isn't the originator of the loans. The foundation would be the loan servicer, so there is actually no real costs associated with the loan part of this program. The entirety of the risks for the World Assembly itself is the insurance fund.

But in thinking that there's a huge risk in establishing an insurance fund ignores the purpose of insurance in the first place! There are corporations that insure against death, which is a 100% certainty. How do these insurance funds afford to always pay out claims? It's simple: the premiums they charge cover cover their inherent liabilities plus a risk interval. Similarly, the premiums paid by those states taking out insurance would be high enough to cover all claims, plus the costs associated with riskier investments. And if an investment is simply too risky, the foundation wouldn't insure it. So the sky is not preemptively falling, the Sanctarian delegation is just overly risk-averse.

- Dr. B. castro

[Libraria and Ausitoria]

Well if we're looking at the creation of WA bonds to finance WA loans at prices decided by the market, we have no objection here. Just don't expect many Ausitorians to give the WA an AAA credit rating.

[Glen-Rhodes]

Well if we're looking at the creation of WA bonds to finance WA loans at prices decided by the market, we have no objection here. Just don't expect many Ausitorians to give the WA an AAA credit rating.

Not that this proposal have nothing to do with the creation of 'WA bonds' or the World Assembly originating loans, but your credit ratings bureaus would be laughed out of their own credibility if they assigned anything other than AAA rating to an organization that draws its funds directly from sovereign member states. Regardless, the World Assembly cannot ever go bankrupt: it never takes out credit.

[Libraria and Ausitoria]

Our point is that if the development fund's loans was funded by loans to it it would be a de-facto bond system, with nations/organizations lending money to the development fund for further lending. These 'bonds' would not be backed by WA member's money, so subsequently would assume the overall credit ratings of the recipients - which would be perfectly acceptable to us, indeed, a commendable vehicle for providing money to appropriate recipients. If we were lending money directly to the WA rather than to an arm of the WA functioning on behalf of developing members that would be different.

[Glen-Rhodes]

Our point is that if the development fund's loans was funded by loans to it it would be a de-facto bond system, with nations/organizations lending money to the development fund for further lending.

I'm not sure why you understand it this way. Yes, it can be argued that a loan serviced by the Development Foundation is a 'bond' in the most general sense. But by calling it a bond, you erroneously make it sound like the foundation would be the holder of debt, which is something it would never become. You can characterize it as a middle-man that manages bond purchases between developed and developing countries, but in reality these aren't true bond purchases. Bonds are relatively rigid instruments, whereas these loans would almost certainly be flexible. So, we should just call it what is it: the Development Foundation services and overall manages loans between developed and developing states, and in doing so assists developing states with structural economic reforms.

These 'bonds' would not be backed by WA member's money, so subsequently would assume the overall credit ratings of the recipients ...

There would not be 100% certainty that a developing state would be able to fulfill its obligations at the maturity of a bond, that is true. (I think you mixed up who pays back money with bonds, by the way.) If they have their own currency, they could always just print money to avoid default, but this is all really an unimportant tangent anyways. All money flowing in and out of the foundation would belong to member states. It would all be backed by those sovereign states.

I'm assuming that you mean, in your last sentence, that the foundation would end up assuming the credit ratings of the recipient developing states. Again, I find it difficult to see why you believe this. First of all, credit ratings aren't as important in financing developing state capital projects as they are in every-day financial transactions between states. Credit ratings will always be lackluster in this market; that's why special financial institutions are created to facilitate investment.

Second, the foundation wouldn't assume any of the debt, so it would never have a credit rating. It's easy to mistake the insurance program as the foundation holding massive amounts of debt, and thus have a worrisome credit portfolio, but that results for misunderstanding how the insurance program works. I'm not sure how to better explain it than I did in previous comments. The likelihood of the insurance program becoming a huge financial risk is almost nil. The foundation would be capable of hiring actuaries, and the state of actuarial science is well-equipped to determine how high premiums should be and how much the foundation should hold in loss reserves. Insurance is nothing new, after all.

If we were lending money directly to the WA rather than to an arm of the WA functioning on behalf of developing members that would be different.

The World Assembly isn't a state and doesn't have currency or an economy, though. So wouldn't that simply complicate the process? The World Assembly would have to collect the payments from developing states, then make payments with that money to the developed states. That introduces unnecessary overhead costs and would actually mean the World Assembly holds debt.

[Libraria and Ausitoria]

These 'bonds' would not be backed by WA member's money, so subsequently would assume the overall credit ratings of the recipients ...

I'm assuming that you mean, in your last sentence, that the foundation would end up assuming the credit ratings of the recipient developing states. Again, I find it difficult to see why you believe this. First of all, credit ratings aren't as important in financing developing state capital projects as they are in every-day financial transactions between states. Credit ratings will always be lackluster in this market; that's why special financial institutions are created to facilitate investment.

By 'assume' we meant 'be equivalent to'.

We believe the difference lies in Glen-Rhodes seeing the fund as a facilitator and us seeing it as an investment company. It would be the latter if it raises money and then spends it as it decides. Since how exactly this fund would function has not been determined, we disagree over how it would function. We would prefer the latter system (the fund raises money from the market and chooses how to lend it) rather than the former (the fund points out who needs a loan and the market supplies it) so that developmental risk is shared and the fund sets the insurance premiums based on their own (more likely to be accurate) research.

[Royalsoldiers]

"I would like to offer my partial support of the WA Development Foundation. I love the idea but I am just unsure of its importance to my nations."

Ambassador Michael A. Eastwood

[Auralia]

May we propose a few amendments?

I took your "as necessary" suggestion, but I left in "developing"; this program is not for relatively wealthy member nations.

By 'assume' we meant 'be equivalent to'.
We believe the difference lies in Glen-Rhodes seeing the fund as a facilitator and us seeing it as an investment company. It would be the latter if it raises money and then spends it as it decides. Since how exactly this fund would function has not been determined, we disagree over how it would function. We would prefer the latter system (the fund raises money from the market and chooses how to lend it) rather than the former (the fund points out who needs a loan and the market supplies it) so that developmental risk is shared and the fund sets the insurance premiums based on their own (more likely to be accurate) research.

This proposal includes aspects of both. The loans program is more along the lines of a facilitator, since the Foundation bears none of the risk; it is entirely financed by developed member nations. However, the insurance program is more like an investment company, since the Foundation bears all of the risk. I will clarify this difference in the resolution.

I will likely submit this in a few days, if there are no further concerns.

[Cowardly Pacifists]

I have another concern. Please explain how a committee that facilitates loans to certain nations, and provides insurance for those loans, is a "free trade" proposal. I see nothing in this proposal that would significantly reduce or eliminate barriers to free trade. It's not even about trade. It's about investment in national infrastructure for "poverty reduction," and about turning the WA into an insurance company.

This proposal does not belong in this category.

[Auralia]

I have another concern. Please explain how a committee that facilitates loans to certain nations, and provides insurance for those loans, is a "free trade" proposal. I see nothing in this proposal that would significantly reduce or eliminate barriers to free trade. It's not even about trade. It's about investment in national infrastructure for "poverty reduction," and about turning the WA into an insurance company.

This proposal does not belong in this category.

I strongly disagree for two key reasons:

• The Foundation's investment insurance program reduces the risk of investing in developing nations. The promotion of foreign investment is certainly appropriate for a free trade proposal.
• The Foundation makes loans to developing nations conditional on the adoption of the governmental reforms listed in their poverty reduction strategy, many of which are tailored to opening up their markets and making their country more attractive for foreign investors. Again, this clearly belongs in a free trade proposal.

[Cowardly Pacifists]

I strongly disagree for two key reasons:

• The Foundation's investment insurance program reduces the risk of investing in developing nations. The promotion of foreign investment is certainly appropriate for a free trade proposal.
• The Foundation makes loans to developing nations conditional on the adoption of the governmental reforms listed in their poverty reduction strategy, many of which are tailored to opening up their markets and making their country more attractive for foreign investors. Again, this clearly belongs in a free trade proposal.

Those investments are not trade related. They are for the purpose of "promoting the reduction of poverty in developing member nations." It sounds more like a Social Justice proposal. You're increasing basic welfare by enacting a government regulatory scheme on foreign development loans. The insurance provision does not promote free investment; it promotes targeted investment in poverty reduction plans. You're using government to create a preference for certain financial products over others that are already available in the marketplace. That's not free trade.

You say that the poverty reduction reforms "are tailored to opening up their markets and making their country more attractive for foreign investors." You're obviously referring to this line:

appropriate governmental reforms, including austerity measures and balanced budgets, democratic reforms, improving respect for fundamental human rights, anti-corruption legislation, trade liberalization and privatization, increased spending on basic social programs, and the promotion of sustainable development,

Democratic reforms, fundamental human rights, increased spending on basic social programs, and sustainable development are not acts "tailored to opening up markets." We know that because we gave them their own category other than free trade. These things are ends in themselves. If they have an impact on free trade, that's nice I suppose. But you can hardly claim that they are free trade principles.

While you did sandwich "trade liberalization and privatization" in there, that's not really the aim of these poverty reduction strategies is it? The aim is stated just above:

A poverty reduction strategy must include, as necessary... capital projects targeted at improving the infrastructure required to provide basic services to the population and support future economic development,

Providing basic services to the population and support for future economic development is a social justice aim. If it has a free trade effect, it's secondary to the social justice effect. And that's a big if... developing nations may ultimately develop protectionist policies to support the fledgling business that spring up thanks to the infrastructure improvements.

And that's forgetting for a second that your proposal puts all of these government restrictions on nations in the first place. I don't see how a proposal that puts a bunch of poverty reduction requirements on nations seeking WA sponsored loans has the effect of reducing "how much regulation there is on business/industry." You're increasing the regulation in order to promote poverty reduction in developing nations.

If anything, this is a mild social justice proposal aimed at reducing poverty by encouraging (but not requiring) member nations to invest in the infrastructure of other nations. It is not a free trade proposal.


Best Regards,

[Neldaria]

Before even reading the proposal in it's entirety, I see a problematic contradiction with the Category. Your opening statements very clearly refer to poverty reduction and improvement of basic welfare. Therefore it should be a Social Justice resolution. If the actual meat of the proposal deals with Free Trade elements, then your title and opening statements are fundamentally misleading. Please correct or clarify.

[Neldaria]

Apologies for the double post, but I have had the opportunity to read the full text sooner than expected and would like to expand on my initial criticism.

• This is indeed without any doubt a Social Justice proposal. The resolution is rife with references to poverty reduction.
• Article II 3b includes contradictory language. For example, Austerity Measures and Increased Spending on Social Programs are mutually exclusive practices, as are Trade Liberalization and Privatization. This clause causes more confusion than clarity, the delegate should either take a stance on whether a liberal or conservative approach is best, or remove this language entirely, allowing the committee and the individual nation to decide the best approach case-by-case.
• Article IV in it's entirely is troubling, as if I understand it correctly, the counties providing the funds will be the ones paying extra to ensure insurance is available for all loans. While I do not have a alternative suggestion I am comfortable supporting, I don't like this alternative either as it will discourage member nations from participating in the program as investors. I recommend that Article IV be stricken entirely. Participation in the Foundation as an investor is already a voluntary decision, so potential investors should be prepared to accept risk or arrange terms for repayment on a case-by-case basis.

I definitely approve of the spirit of this resolution, I fully support the idea that the WA could facilitate a voluntary forum to more effectively coordinate aid than member nations could independently. It just needs some clean-up in order to garner my full support.

[Libraria and Ausitoria]

May we propose a few amendments?

I took your "as necessary" suggestion, but I left in "developing"; this program is not for relatively wealthy member nations.

We are rather disappointed. Many 'developed' nations may have large scale poverty of their own in small areas or lower classes of the population; and besides it would be good for 'developed' countries to behave fiscally responsibly for a change.

This proposal includes aspects of both. The loans program is more along the lines of a facilitator, since the Foundation bears none of the risk; it is entirely financed by developed member nations. However, the insurance program is more like an investment company, since the Foundation bears all of the risk. I will clarify this difference in the resolution.

We look forward to the clarification. While modifications are being made, we would like to raise a few points:

First we believe that despite the encouragement of social justice, if this proposal can be classed as the facilitation of free foreign investment in governments and their subsidiaries it could be argued to be encouraging free trade, i.e. 'A resolution to reduce barriers to free trade and commerce'.

And that's forgetting for a second that your proposal puts all of these government restrictions on nations in the first place. I don't see how a proposal that puts a bunch of poverty reduction requirements on nations seeking WA sponsored loans has the effect of reducing "how much regulation there is on business/industry." You're increasing the regulation in order to promote poverty reduction in developing nations.

At present since nations cannot seek WA sponsored/facilitated loans the proposal at hand cannot logically make it more difficult - rather it makes it easier for developing nations fulfilling certain criteria to seek developmental loans supplied by the free market. It also makes it easier for people to invest in developing nations.

Article II 3b includes contradictory language. For example, Austerity Measures and Increased Spending on Social Programs are mutually exclusive practices, as are Trade Liberalization and Privatization.

Neither are mutually contradictory. To take the pairs respectively:
1. Austerity can only be done if there is a deficit to cut. Any nation without a deficit can easily cut the deficit (as it is non-existent) and simultaneously increase spending on Social Programs. It is also possible for a nation to exercise Austerity on say an oversized military budget and simultaneously increase the Education budget while overall lowering the deficit.
2. Trade liberalization, e.g. lowering tarrifs, does not impinge upon the ability of a nation to for instance privatize car manufacturers.

And finally, as a general recommendation, we strongly recommend that private investors be allowed to invest in this program as well as developed nations. By providing people with good and sound investment opportunities, this would massively increase the source of funding for such a fine proposal, allowing many more nations to be lifted from poverty.
(This would also improve free trade very considerably).

[Glen-Rhodes]

This is not a social justice proposal, as it doesn't increase welfare spending. Mods have typically required social justice proposals to increase the actual welfare state, not simply attempting to decrease poverty. Though they probably wouldn't care if it was submitted in the social justice category, since the category itself is FUBAR when it comes to defining what specially it's for.

Facilitating international finance is obviously free trade, though. I'm surprised anybody thinks otherwise.

[Neldaria]

I give you the definition and explanation of Social Justice vs. Free Trade from the rules thread:

Free Trade - A resolution to reduce barriers to free trade and commerce.
Social Justice - A resolution to reduce income inequality and increase basic welfare.
These are almost exactly opposed types of resolutions. Both affect Economic freedoms. "Free Trade" increases Economic freedoms while "Social Justice" reduces Economic freedoms. In addition, "Social Justice" also increases government spending on welfare...

"Poverty Reduction" is another way of saying "Reducing Income Inequality", and to assert otherwise is debating semantics, so that's 1 requirement satisfied.

Next, to satisfy the second requirement, let's take a look at Article II. I'll do you the favor of underlining all the portions that pertain to welfare:

3. A poverty reduction strategy must include, as necessary:
a. capital projects targeted at improving the infrastructure required to provide basic services to the population and support future economic development,
b. appropriate governmental reforms, including austerity measures and balanced budgets, democratic reforms, improving respect for fundamental human rights, anti-corruption legislation, trade liberalization and privatization, increased spending on basic social programs, and the promotion of sustainable development

And finally, while this resolution would have enormous impact on the national economies of nations receiving aid, it in no way affects the barriers to free trade and commerce on the international scale. Nations are already capable of doing the financial aspect of this resolution independently. So not only does it meet both requirements of Social Justice resolutions, but it fails to meet the criteria of Free Trade ones.

---

Neither [of the cases questioned by Neldaria] are mutually contradictory. To take the pairs respectively:
1. Austerity can only be done if there is a deficit to cut. Any nation without a deficit can easily cut the deficit (as it is non-existent) and simultaneously increase spending on Social Programs. It is also possible for a nation to exercise Austerity on say an oversized military budget and simultaneously increase the Education budget while overall lowering the deficit.

If there is no deficit to cut, nations will not likely be receiving financial aid, and even if they were, you are misusing the term of Austerity. Austerity is by definition "In economics, austerity refers to a policy of deficit-cutting by lowering spending via a reduction in the amount of benefits and public services provided.". It's not JUST reducing the deficit, it is a specific tactic of deficit-cutting that targets "welfare spending".

[Cowardly Pacifists]

This is not a social justice proposal, as it doesn't increase welfare spending. Mods have typically required social justice proposals to increase the actual welfare state, not simply attempting to decrease poverty. Though they probably wouldn't care if it was submitted in the social justice category, since the category itself is FUBAR when it comes to defining what specially it's for.

Facilitating international finance is obviously free trade, though. I'm surprised anybody thinks otherwise.

This proposal facilitates international finance of poverty reduction projects. The proponents of this act would have us see only the word "finance" and immediately think "trade." We should be focused on what we are financing. Financing poverty reduction and improved infrastructure in developing nations is a social justice aim. It is not "free" in the sense that the government is actively picking and promoting certain preferred investments, and it is not "trade" in the sense that any commercial benefit is secondary to the social welfare benefit.

I remain opposed to this act, regardless of category, so long as the insurance provisions are left in. I have no interest in turning the WA into "an investment company," where "the Foundation bears all of the risk" (Auralia's words). That said, I am still receptive to the provisions that facilitate poverty reduction, though I maintain that the category and strength need to be changed for this to be legal.

[Glen-Rhodes]

This proposal facilitates international finance of poverty reduction projects. ... We should be focused on what we are financing.

Yes, it does finance poverty reduction. But I'm not sure why anybody thinks that what is being finances matters. The World Assembly already participates in international financial markets with the agenda of reducing poverty, and it does so under the agenda of free trade rather than social welfare/justice. It's the fact that these projects are being financed, rather than being completely paid for by grants or typical welfare transfers, that makes them free trade proposals. It's a market solution, and as such it inherently increases the international free market.

[Neldaria]

[snip of arguing this is a Free Trade resolution]

See my post above responding to this claim. The resolution satisfies both the requirements of Social Justice resolutions, while failing to meet the criteria of a Free Trade one. It doesn't affect the international market, because there isn't a barrier to this kind of behavior that is being removed. Nations are already free to do the financing if they want.

[Camian WA Mission]

The intentions of this are solid, and well hearted, though the practicality of this proposal is hard to justify. It seems like a huge investment that member states will have to pour money into, and get little return. I don't like aspect of loaning and insurance, I foresee a large amount of developing nations defaulting on their loans, and in the case of the insurance, it looks like a big black hole sucking a all sorts of cash. As of now, I am opposed, but subject to reconsideration.

[Libraria and Ausitoria]

I give you the definition and explanation of Social Justice vs. Free Trade from the rules thread:

Free Trade - A resolution to reduce barriers to free trade and commerce.
Social Justice - A resolution to reduce income inequality and increase basic welfare.
These are almost exactly opposed types of resolutions. Both affect Economic freedoms. "Free Trade" increases Economic freedoms while "Social Justice" reduces Economic freedoms. In addition, "Social Justice" also increases government spending on welfare...

"Poverty Reduction" is another way of saying "Reducing Income Inequality", and to assert otherwise is debating semantics, so that's 1 requirement satisfied.

They are not exactly opposite. Take Libraria and Ausitoria. Free Market and also big-government. It is perfectly possible to encourage free capitalism and tax it.

And finally, while this resolution would have enormous impact on the national economies of nations receiving aid, it in no way affects the barriers to free trade and commerce on the international scale. Nations are already capable of doing the financial aspect of this resolution independently. So not only does it meet both requirements of Social Justice resolutions, but it fails to meet the criteria of Free Trade ones.

We disagree, and this is the crux of our disagreement: If the WA were to thoroughly investigate borderline cases it would encourage a better understanding of the risks involved, and hence encourage and thus enable more investment to worthy nations; i.e. enable more free trade.

Neither [of the cases questioned by Neldaria] are mutually contradictory. To take the pairs respectively:
1. Austerity can only be done if there is a deficit to cut. Any nation without a deficit can easily cut the deficit (as it is non-existent) and simultaneously increase spending on Social Programs. It is also possible for a nation to exercise Austerity on say an oversized military budget and simultaneously increase the Education budget while overall lowering the deficit.

If there is no deficit to cut, nations will not likely be receiving financial aid, and even if they were, you are misusing the term of Austerity. Austerity is by definition "In economics, austerity refers to a policy of deficit-cutting by lowering spending via a reduction in the amount of benefits and public services provided.". It's not JUST reducing the deficit, it is a specific tactic of deficit-cutting that targets "welfare spending".

So things like policing, law, order, and defence aren't a service to the public? Interesting.

I remain opposed to this act, regardless of category, so long as the insurance provisions are left in. I have no interest in turning the WA into "an investment company" where "the Foundation bears all of the risk" (Auralia's words). That said, I am still receptive to the provisions that facilitate poverty reduction, though I maintain that the category and strength need to be changed for this to be legal.

If I may reply with the full quote:

The loans program is more along the lines of a facilitator, since the Foundation bears none of the risk; it is entirely financed by developed member nations. However, the insurance program is more like an investment company, since the Foundation bears all of the risk. I will clarify this difference in the resolution.

We do agree that the WA should not bear all the risk: we believe it should be passed on to the investors.
Basically the situation we would prefer is for only the loans program to go through, with the WADF creating a portfolio or portfolios to lend money to deserving member nations (together or individually or a mixture of both) on condition of sound economic policy, with the WADF choosing an appropriate interest rate to reflect the risk. Individual nations/companies/persons would then invest in the WADF portfolio or portfolios, acquiring the right to their portion of the interest (and the eventual return of their portion of the loan), the WADF would invest the money in the deserving countries, the WADF would receive the returns, and pass it back to the individuals who provided the money, while taking a small premium of their own to cover the costs of research to decide appropriate interest rates and economic policies.

Ideally, high-risk countries could under this proposal be able to gain access to funds they would not have otherwise secured for two principal reasons: 1. the WADF investors would be together they would be in a better bargaining position, and 2. they would be following an economic policy approved by an increasingly well-experienced organization. (Also as part of a portfolio the risk would be better spread, but hedging with credit-default swaps should do that anyway).

[Neldaria]

[Free Trade and Social Justice] are not exactly opposite.

I was quoting the rules post, not making a statement of opinion. The Rules post also doesn't say they're *exactly* opposite either.

If the WA were to thoroughly investigate borderline cases it would encourage a better understanding of the risks involved, and hence encourage and thus enable more investment to worthy nations; i.e. enable more free trade.

It encourages this investment, but doesn't enable them, because there is currently no barrier to them in the first place, and the removal of barriers is the key to a Free Trade designation

So things like policing, law, order, and defence isn't a service to the public? Interesting.

You are taking my comment completely out of context, so I won't even bother responding to that bit. I was, as a point of order as it were, correcting your slightly incorrect use of "austerity", not making a political statement.

[Libraria and Ausitoria]

[Free Trade and Social Justice] are not exactly opposite.

I was quoting the rules post, not making a statement of opinion. The Rules post also doesn't say they're *exactly* opposite either.

Very true. On the subject, we wouldn't even say they're inexactly opposite. In fact, they aren't opposite at all. It's like saying an imaginary number is the opposite of a real number.

If the WA were to thoroughly investigate borderline cases it would encourage a better understanding of the risks involved, and hence encourage and thus enable more investment to worthy nations; i.e. enable more free trade.

It encourages this investment, but doesn't enable them, because there is currently no barrier to them in the first place, and the removal of barriers is the key to a Free Trade designation.

There are self-imposed barriers - for instance, investment funds/governments/individuals are very unwilling to invest in risky places that they don't understand and have no influence over. Therefore this proposal doesn't remove barriers directly - rather, it removes the cause of the self-imposed barrier.

So things like policing, law, order, and defence isn't a service to the public? Interesting.

You are taking my comment completely out of context, so I won't even bother responding to that bit. I was, as a point of order as it were, correcting your slightly incorrect use of "austerity", not making a political statement.

We do apologize for inadvertently making that look out of context. Our point was and is that everything a government spends money on is a public service (i.e. provided by the public for the public) of some sort, hence by reducing any government spending it counts as austerity. Therefore our definitions must be equivalent.

[Glen-Rhodes]

There are self-imposed barriers - for instance, investment funds/governments/individuals are very unwilling to invest in risky places that they don't understand and have no influence over. Therefore this proposal doesn't remove barriers directly - rather, it removes the cause of the self-imposed barrier.

This is the right idea, but it's better to acknowledge that not all barriers to trade are created by the state. The market creates barriers in and of itself when it comes to investments that have an inherently high risk. Risk averseness is as much a barrier as tariffs are.

[Neldaria]

There are self-imposed barriers [to trade in this instance] - for instance, investment funds/governments/individuals are very unwilling to invest in risky places that they don't understand and have no influence over. Therefore this proposal doesn't remove barriers directly - rather, it removes the cause of the self-imposed barrier.

Well potential investors still have no control or useful influence over the funds' use in a given nation. Also, I wouldn't consider self-imposed barriers to be true "barriers" in the legislative sense. Especially given that if investors wanted to do this kind of work, they could make use of or develop the means to assess such risky situations. So my point remains that this resolution isn't removing any substantive barriers.

I agree with everything you're saying in the sense that this encouragement to invest is a good and effective strategy. I'm just disputing it's mis-labeling.