Rethinking the Standards of Treatment in the Ethiopian and Kenyan BITs: An Approach Towards Certainty

Abstract

One of the policy justification behind concluding BITs is to extend protection of home state investors and investment to foreign investors. The typical mechanism for doing so is by providing entitlements and privileges to investors and imposing obligations on the host state in the form of standards of treatment. As such, conclusion of BITs send a signal to all investors that the host states are willing to protect the interest of foreign investors. With a view to demonstrate that they are investor-friendly and to attract foreign direct investment(FDI), Ethiopia and Kenya have entered into various Bilateral Investment Treaties (BITs) with developing and developed countries. This paper examines the standards of treatment in Ethiopia’s and Kenya’s BITs. A doctrinal research methodology has been employed to explore the issues surrounding this subject. The research found out that many of the existing BITs of the two countries are investor-oriented and have crippled the policy space and sustainable development of the two countries. This is largely attributed to the countries’ adoption of century old models of FDI.