Revue - Les Cahiers de l'Arbitrage N°2 - 2023 - 52

AFRICA SPECIAL ISSUE
African States acknowledge that Chinese debt, if unpaid, may lead to the
takeover of infrastructure projects financed through the BRI initiative. It is speculated
that Uganda will lose control of its Entebbe airport to China because the Ugandan
government waived international immunity in the agreement it signed to secure
the loans, thereby exposing Entebbe International Airport to takeover without any
international protection. Similarly, Nigeria waived its sovereignty to access a loan
of US$500 million from China for the financing of rail projects in the country. 77
China is not oblivious to the possibility of debt defaults or other contractual
disagreements and in a forward thinking mode, has capitalised on its steady
increase of foreign investments in Africa, and the desire for African countries to
achieve international recognition as prospective seats and venues for the resolution
of international disputes, by establishing a China-Africa Joint Arbitration Centre
( " CAJAC " ) based on an agreement reached at the Beijing Consensus, signed in
2015, which agreed to develop a joint dispute resolution framework between
China and Africa. One centre is headquartered in Johannesburg, South Africa, and
another CAJAC Centre is located in Nairobi, Kenya. The CAJAC objective is to
become the venue of choice for addressing business disputes between Chinese and
African parties. Each CAJAC centre is required to apply CAJAC rules ensuring that
a uniform set of arbitration provisions relating to the procedures, recognition and
enforcement of arbitral awards is available.
The Centres operate using a standard set of rules 78
which can be supplemented
by local rules of each centre. Article 1.1 of the CAJAC Rules announces that, " [t]he
China Africa Joint Arbitration Centre (CAJAC) has been established at the instance
of the Forum of China Africa Cooperation (FOCAC) to administer the resolution
of international disputes arising between Chinese and African entities having the
principal residence, place of business, nationality located in China or a country
in Africa " while Article 1.2 provides for dispute resolution mechanisms, including
mediation, conciliation and arbitration.
However, the dream of a China-Africa dispute resolution mechanism which
would be supported and utilized by the business and legal communities of both
China and Africa has not yet materialised as neither Chinese nor African parties
have, to date, utilised CAJAC in international investment proceedings. The award
in Zhongshan Fucheng v Nigeria 79
thought to be the first treaty award in which
a tribunal has ruled in favour of a Chinese investor against an African State, is
a case in point. The dispute related to the Ogun Guangdong Free Trade Zone,
near Lagos, and the arbitration proceeded under the China-Nigeria BIT and utilised
(https://economictimes.indiatimes.com/news/international/world-news/africa-cancels-a-bri-projectfor-the-first-time/articleshow/66363312.cms?utm_source=contentofinterest&utm_medium=text&utm_
campaign=cppst).
77.
See, Emeka UMEJEI, " China's Belt and Road Initiative and Debt-Trap Diplomacy in Africa " ,
Daily Trust, 8 December 2021 (https://dailytrust.com/chinas-belt-and-road-initiative-and-debt-trapdiplomacy-in-africa/).
78.
CAJAC Rules, China-Africa Joint Arbitration Centre, August 2015 (https://cajacjhb.com/
wp-content/uploads/2020/10/CAJAC_Rules_2020.pdf).
79. See, Damien CHARLOTIN, " Revealed: Under the Radar BIT Claim by Chinese Investor
against African State results in an Award " , Investment Arbitration Reporter, 8 September 2021
(https://www.iareporter.com/arbitration-cases/zhongshan-fucheng-v-nigeria/). See also, Zhongshan
Fucheng Industrial Investment Co. Ltd. v Federal Republic of Nigeria, Award dated 26 March 2021
(https://www.italaw.com/sites/default/files/case-documents/italaw170108.pdf).
326
The Paris Journal of International Arbitration 2023‑2

https://economictimes.indiatimes.com/news/international/world-news/africa-cancels-a-bri-project-for-the-first-time/articleshow/66363312.cms?utm https://economictimes.indiatimes.com/news/international/world-news/africa-cancels-a-bri-project-for-the-first-time/articleshow/66363312.cms?utm https://economictimes.indiatimes.com/news/international/world-news/africa-cancels-a-bri-project-for-the-first-time/articleshow/66363312.cms?utm https://dailytrust.com/chinas-belt-and-road-initiative-and-debt-trap-diplomacy-in-africa/ https://dailytrust.com/chinas-belt-and-road-initiative-and-debt-trap-diplomacy-in-africa/ https://cajacjhb.com/wp-content/uploads/2020/10/CAJAC_Rules_2020.pdf https://cajacjhb.com/wp-content/uploads/2020/10/CAJAC_Rules_2020.pdf https://www.iareporter.com/arbitration-cases/zhongshan-fucheng-v-nigeria/ https://www.italaw.com/sites/default/files/case-documents/italaw170108.pdf

Revue - Les Cahiers de l'Arbitrage N°2 - 2023

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