Call for independent body to settle investor disputes
Tanzania Ports Authority director general Deusdedit Kakoko (centre) speaks Tuesday evening in Dar es Salaam during a panel discussion on why the private sector is not keen on financing infrastructure projects. Left is National Development Corporation managing director Prof Damian Gabagambi. PHOTO | tanzania information services department
Dar es Salaam. A call has been made for the Southern African Development Community (Sadc) to set up an independent arbitration body to resolve investor disputes.
Participants at the ongoing Sadc Industrialisation Week said Tuesday the regional bloc needed a “homegrown” independent mediator to boost investor confidence.
They were sharing views during a panel discussion on why the private sector seems to not have the appetite to finance infrastructure development projects in the region.
Participants noted that setting up a neutral body for mediation would help attract investment from skeptical private financiers.
Tanzania Ports Authority (TPA) director general Deusdedit Kakoko noted: “The body should be international but grounded in local culture to be understood by member states.”
But he was quick to explain that a lot of factors should be considered in setting up an arbitration for the regional bloc -- including location, security and travelling costs.
A standard Sadc law would help build confidence in investors, he added.
In the past few years, the resolution of investment disputes has become a puzzling topic in Sadc after the demise of the Sadc Tribunal.
Across the region, foreign investors are jittery over non-compliance with investment treaty obligations and non-enforcement of arbitral awards by Sadc member states. Investors also complain about sudden changes of national investment laws by member states.
National Development Corporation (NDC) managing director Damian Gabagambi said using local laws in settling disputes with investors works where good governance is practised.
“Good governance makes it easy for investors to trust in local laws, and not opt for international arbitrators,” noted Prof Gabagambi.
“In Tanzania, we have good governance and we trust our laws. That is why we insist that disputes with investors must be resolved here.”
Meanwhile, Prof Gabagambi said the best way to handle risks in financing infrastructure projects is to reduce risks through political commitment to technology. “In the past 15 years we have not been able to attract the private sector to invest in projects; it is upon governments to de-risk their infrastructure projects by reassuring investors.”
