This annual publication reviews recent trends and prospects in foreign direct investment (FDI). Issues discussed include: Russia's policies towards foreign investment; investment incentives and FDI in selected ASEAN countries; links between international investment agreements; most-favoured nation treatment in international law; investment policy transparency; and OECD guidelines for promoting corporate transparency by multinational enterprises. Findings include that, in 2003, FDI in the OECD region continued to fall, partly due to the sluggish macroeconomic performance of the larger economies, as well as due to the phase of consolidation that has followed the rampant cross-border investment of the late 1990's and the peak year of 2000. However, this contraction does not imply that FDI activity is low by any longer-term historic standard. Direct investment into North America was particularly hard hit during 2003, whereas flows from OECD countries towards developing and emerging economies held up well.