The revelation that Commonwealth countries are at risk of losing foreign investment and trade from not having modern dispute resolution systems available to their business communities is disturbing. A majority of small to medium-sized enterprises (SMEs) are unable to expand into international markets or cross-border trade due to uncertainty over dispute resolution.
A recent study developed by the Commonwealth Secretariat’s Office of Civil and Criminal Justice Reform identifies 10 challenges hindering the use of international commercial arbitration as a dispute resolution mechanism. One challenge is that more than half of Commonwealth countries do not have a structure that reflects modern best practice, with a small number not having a legislative framework for arbitration at all. Other obstacles include costs, regulatory issues and a lack of understanding, expertise and diversity.
It is important that African countries appraise their SMEs and MSMEs on hallmarks of a modern international arbitration framework to enable them do business in other countries and cushion them from losing foreign direct investment and trade revenue.