Africa must not let disputes with foreign investors undermine its Covid-19 response
There is an imminent threat of claims arising from emergency measures, so countries should review how investor-state disputes are handled
In 2012 SA embarked on bold reforms to terminate its old-generation investment treaties, with their infamous investor-state dispute settlement (ISDS) mechanisms. The move came after years of grappling with excessive arbitral awards, lack of transparency in arbitration proceedings, and constrained policy space for its development objectives.
Today SA continues to push for reform of the system, underscoring the detrimental effect on public budgets, regulations in the public interest and the rule of law. These problems are due, in part, to foreign investors using the process to bypass domestic institutions and laws. While the need for reform remains, it has become urgent in 2020 in light of the novel coronavirus pandemic, given that foreign investors are expected to challenge some of the emergency measures taken in response...