Tracing the Path from International Investment Disputes to Domestic Legal Reform: A Case Study of Tanzania

Abstract

Tanzania is rich in natural resources and strategically located in East Africa; it has become a significant destination for foreign direct investment (FDI). However, the country faces challenges related to international investment disputes, often stemming from conflicts between foreign investors and the government as a result of a weak investment regulatory framework. This article aims to explore how international investment disputes can serve as an opportunity for legal reforms on FDI. The Doctrinal methodology is used to study pieces of legislation, international instruments, arbitration case decisions, Journal articles, books and electronic sources. Despite progress, Tanzania's legal framework shows weaknesses such as poor enforcement mechanisms, bureaucratic stamps, and ambiguity in legal provisions. These issues are bottlenecks to effective dispute resolution and investor confidence. To enhance the investment climate, Tanzania should undertake comprehensive legal reforms, balance investor protections with national interests, and actively engage stakeholders. By fostering a transparent and equitable legal environment, Tanzania can attract responsible foreign investment and promote sustainable economic growth.