Columbia International Affairs Online: Policy Briefs

CIAO DATE: 04/2014

Minority rules: State ownership and foreign direct investment risk mitigation strategy

Barclay E. James, Paul M. Vaaler.

December 2013

Columbia Center on Sustainable Investment


In countries where policies protecting private investor rights are more susceptible to change, substantial minority state ownership in a project can substantially decrease overall investment project risk. Sometimes, some state ownership in a project is just the thing to keep the state from changing important terms in the original agreement to the detriment of private co-investors.