African economies must review and terminate existing bilateral investment treaties, avoid signing new ones and remove themselves from international investment arbitration system, according to Mr Nicomedes Kajungu, the secretary general of the National Union of Mines and Energy Workers of Tanzania.
Mr Kajungu said there is a growing trend of legal suits filed by multinationals against African countries, which has become a major concern across the continent. Most of these suits, he said, stem from bilateral investment treaties signed between countries over the past three or so decades.
“So far, African countries have signed 568 bilateral investment treaties and free trade agreements with investment provisions, mainly with other countries outside Africa,” he said, dismissing claims that bilateral investment treaties guarantee greater foreign direct investment inflows.
“Huge FDI flows have been registered in countries like Brazil which do not have a single bilateral treaty in force,” he said.
African countries, including Uganda have been battling tax-related disputes, many of which are argued in foreign capitals, especially in London.
Currently, Uganda Revenue Authority is battling a tax dispute with Tullow, whose arbitration in the UK recently collapsed over claims of frustration.