Arbitral Reform in Africa: Growing investment in Nigeria, Kenya, Rwanda and South Africa

African countries have experienced an increase in foreign and domestic investment in recent times. Although the 2019 novel coronavirus disease (COVID-19) pandemic has curtailed foreign direct investment (FDI) inflows worldwide over the past year, the total value of FDI in African countries has increased (https://unctad.org/en/PublicationsLibrary/wir2020_en.pdf). For example, the total value of FDI in Nigeria was estimated to be USD98.6 billion in 2019, up from USD95.318 billion in 2018.

The imminent implementation of the African Continental Free Trade Area Agreement (AfCFTA) is also advantageous for post-pandemic investment. The steady flow of foreign investment in the continent has led to an upsurge in the number of disputes and investors who are reluctant to settle their disputes in African courts resort to arbitration for resolution.

In a clear response to the increase in demand for arbitration services, an increase in arbitration awareness and the growing pro-arbitration culture of some African nations, legal reforms such as the International Arbitration Act 2017 of South Africa have been introduced and over 70 African arbitration institutions have been established in Africa in recent times (http://www.arbitration-icca.org/media/7/14403606533411/list_of_arbitration_institutions_in_africa_-_emilia.pdf).

These reforms, as well as the increase in the number of investment treaties signed by African states and the commendable steps taken by African countries to improve the process of doing business have proved to be crucial to the increase in investor confidence and investment in the continent.