Introduction

The preceding chapter has shown that purely unilateral guarantees and other measures by a capital-importing country, including even constitutional guarantees, are not usually suffcient protection for foreign private investment, because the guarantee that is still lacking is that governments will continue to adhere to the policy manifested in the investment laws. This situation is common amongst developing countries, which are loath to attenuate their repeated assertions of sovereignty over their natural resources. They resent being committed too far, and this makes the achievement of any stable legal regime for the protection of investment by unilateral devices very hard to establish or maintain. Sudan is no exception, whereas Saudi Arabia is a different case, given the stability of the government and the legal regime.

It is important, therefore, to examine investment treaties to explore how far they provide an alternative method of protection, and this also requires examination of the relation between treaties and the national law of an investee state and which prevails over the other in case of conflict.

In this chapter it will also be useful to consider a multilateral investment convention, and the various proposals that have been made for such a convention. However, it is diffcult to draft an acceptable convention on the protection of foreign investment because of the opposed attitudes of the developed and developing countries. Also, for Sudan and Saudi Arabia, it is necessary to take into account their peculiar situation, as members of two different regional organizations.