The KPIs of investment promotion should better reflect a more holistic approach to economic development
It is sometimes said that the currency of economic development – and investment attraction – is jobs. In this view, investment promotion agencies (IPAs) exist primarily to help create employment through the investment they attract. The mission statements of most IPAs suggest that job creation remains the primary goal for most of them.
The almost exclusive focus on job creation means that performance measurement and reporting for IPAs have tended to be quite simple. The agency issues an annual press release highlighting its results for the year, invariably expressed in terms of the number of investment projects and the associated employment and capital expenditure. In some cases, a presentation providing a little more detail, such as a breakdown of projects by industry and geographic origin, is also prepared.
A recent study released by FDI Center suggests that most IPAs still report their results this way. A sample of IPA performance reports from around the world showed that the key performance indicators (KPIs) used most frequently by IPAs are the value of the investment, employment and the number of projects.