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Abstract

This article examines the existing flaws of foreign investment regulations regarding environmental protection in the developing countries. Recommendations to ensure sustainable development in the poor countries will also be presented. For the purposes of explanation, the discussion will be divided in four parts. First, foreign investment will be defined with specific attention to its emergence in the developing countries with brief mention of the actors in foreign investment as well as their influence on the host country's environment. The second part will present an existing conflict between Bangladesh and Occidental Corporation that portrays a typical condition that a developing country faces with foreign investors today. This part will concentrate on identifying legal issues that could arise from a conflict of similar nature. The third part is an examination of present multilateral, bilateral and other international instruments that facilitate sustainability of environment or contradict it. The article suggest that international law is still in a dilemma over whether to attend to the monetary benefit instead of addressing environmental issues in this field. The last part includes recommendations upholding the goal of achieving and sustaining environmental development as well as economic activities. It is important to note that despite social and political controversy over the idea of foreign investment, this article will only concentrate on the area of environmental issues affected by foreign investment.