NAIROBI, April 24 (Xinhua) -- There is need for African governments to reform foreign direct investments laws and ensure the sovereignty of local population is protected, campaigners said on Wednesday.
Jane Nalunga, Ugandan country director for Southern and Eastern African Trade, Information and Negotiations Institute (SEATINI), said that a progressive legislation coupled with enhanced oversight is key to minimize dispute between foreign investors and host countries.
"Foreign investments are needed in this region and the continent as a whole but strong legislation is required to ensure they are people centered and responsive to local needs like employment, skills development and environmental protection," said Nalunga.
She spoke in Nairobi during a forum on reforming bilateral investment treaties in the region against a backdrop of big foreign capital inflows into strategic sectors like mining, transport and manufacturing.
Nalunga said that countries across the eastern African region should phase out obsolete laws that have undermined mutual sharing of benefits arising from foreign direct investments.
"We need to relook the bilateral investments treaties signed over the years to make sure they are reciprocal and limit the risk of litigation. These treaties should not be skewed in favor of investors at the expense of a country's sovereignty," said Nalunga.
There is a growing consensus across the eastern African region on the need for countries to restructure existing investment laws to counter the risk of prolonged and costly legal battles between investors and governments.
Edgar Ondari, executive director of Nairobi-based advocacy group Econews Africa, said that realignment of legislation governing foreign investments is key to boost transparency in the sharing of benefits between investors and host countries.
"These bilateral investments treaties should be renegotiated or terminated altogether if they fail to protect the interests of host countries in terms of revenue, technology transfer or jobs," said Ondari.
Faith Lumonya, program officer at SEATINI Uganda, said that bilateral investment treaties should be responsive to human and environmental rights of indigenous populations to avert conflicts.
