President Gustavo Petro said that Colombia will pull out of investor protection treaties that allow foreign corporations to sue the State over perceived losses before international tribunals.

In a post on social media platform X, Petro said that “I accept the invitation from 200 global economists to change the global investment regime.”

Petro said that investor claims against the State should go “through Colombia’s public justice system. And if that fails, a multilateral tribunal free from local interests.”

The economists, including Nobel Prize winner Joseph Stiglitz and Thomas Piketty from France, asked Petro to withdraw from the widely criticized investor-state dispute settlement system (ISDS), claiming this “poses a serious obstacle to building prosperous, equitable, and sustainable societies.”

In an open letter, the economists said that ISDS “can protect investors from unfair treatment,” but “in practice it has become a tool through which corporations can challenge non-discriminatory public policies on the basis that they affect corporate profitability, rather than because they discriminate against investors.”

“This dynamic raises significant concerns about states’ ability to regulate freely in the public interest, including in the context of climate action,” said the economists.

Written into thousands of international trade and investment treaties, including 18 agreements signed by Colombia, ISDS allows foreign corporations to bypass domestic courts and bring legal claims against host governments before special international arbitration tribunals that routinely award vast sums for alleged harms to their investments. ISDS is asymmetrical by design, granting foreign investors expansive protections that are unavailable to domestic businesses or citizens of the host country.

Economists

The economists urged the president “to begin removing Colombia from ISDS, and launching a broader alliance of countries committed to unwinding ISDS.”

Petro has previously criticized the investor protection elements and free trade deals in general, but has yet to pull out of any the treaties signed by his predecessors in an attempt to increase foreign direct investment in Colombia.