ICC Kenya in partnership with ICC Dispute Resolution Service (DRS) and the ICC Centre of Entrepreneurship hosted the ICC DRS Africa Business Talks event themed ‘A toolbox to boost Africa’s economic development’ that was held as a side event of the Nairobi Arbitration Week summit at a Nairobi Hotel on 20^th September 2023. The event focused on the East African banking sector and its key role in financing the development of businesses in the region in the wake of the Africa Continental Free Trade Area (AfCFTA).

The forum sought to examine the strategic importance of supply chain financing tools and spotlight the ICC tools and best practices that can be implemented in order to boost intra-African Trade. This was the fifth episode of the business talks which ICC DRS has been hosting on African soil, after successful events in Accra in Ghana, Tunis in Tunisia, and Johannesburg and Cape Town in South Africa.

In his opening remarks, Nikhil Desai, Chair of ICC Kenya Commission on Arbitration & ADR and Director acknowledged the timelines of the event noting the increase in the use of ADR as the preferred mode of dispute resolution on the continent. He added that in the last 10 years, the continent had witnessed the growth of formidable arbitration institutions among a diverse and inclusive list of ADR practitioners and a strong commitment from governments and the judiciary supporting the idea.

“There is a huge expectation of accelerating economic development on our continent. So, the idea is to put together legal, business and economic experts from different jurisdictions to talk about what tools are necessary to accelerate the development of our economies.”  Remarked Diamana Diawara - Regional Director for Africa, ICC DRS.

The event took the formation of a roundtable discussion on the necessary tools for supporting the development of value chains in East Africa. The panellist included Mélanie Laloum - Lead Economist, ICC Global Policy; Andrew Kigira – ICC Global Banking Commission & Group Head of Trade Products at Equity Bank; Rita Ricciardi - Founding Partner at Bergs & More; Esther Nthenya – Chair of Manufacturing Committee, Kenya National Chamber of Commerce and Industry (KNCCI); and James Holden – Partner at White & Case, in a session that was moderated by Ms Diawara.

Some of the takeaways from the discussions included;

• For AfCFTA to be successful, the current infrastructure should be improved to make trading less expensive in the continent.
• Limited skill transfer in the manufacturing sector in value addition and uncertainty around geopolitical risks are major impediment factors to the realization of AfCFTA gains.
• Financial literacy is key, however, branding of SMEs is important in accessing local financing from banks.
• The legal system is very critical to the investment regime because investors want a robust legal system to protect their interests in case of disputes. Arbitration, therefore, is vital to realizing the interests of investors.
• Institutional arbitration and mediation rules have to be inculcated in local financing systems to effectively resolve commercial disputes.
• Sustainability is key in securing finance, especially the ESG principles.
• There's gap in policymaking and implementation.
• Separating Trade Finance lending from traditional financing solutions eliminates the challenges that come with collaterals.
• Traditional trading characteristics have influenced the development of the old rules developed by the ICC Banking Commission which are in line with the market and the industry.
• The AfCFTA protocol on dispute resolution does not have the full annex on dispute resolution. The finalization of the annex may give more clarity even with the departure of BITs.

It emerged that promoting African countries as safe seats of arbitration is vital in promoting the African business community. This aspiration can be made possible with the fact that the continent has skilled arbitrators. However, the judiciary still plays a critical role in promoting African countries as seats of arbitration. “ICC hub is focused on fostering the entrepreneurship spirit, capacity building and training,” said Virginia Waruingi - Head of ICC Centre of Entrepreneurship Nairobi Hub, KNCCI in her closing remarks.