Even so, the increase in disputes is staggering. Treaty-based cases brought before the World Bank’s International Centre for Settlement Disputes increased from three at end-1994 to 106 at end-2004, according to Unctad. Cases outside of ICSID have risen from two to 54 in the same period.

While exceptional circumstances can inflate the figures – the Argentine crisis produced numerous claims – many others go unreported, so the true figure may be even higher. Disputes are costly to both parties, in both time and money. The country loses investment and the company incurs a huge opportunity cost.

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fDi magazine has striven to keep readers up to date with investment dispute cases. Some while ago, we conducted an investigation into the notorious Metalclad case against Mexico under Nafta, which ended in Mexico paying the company $17m in compensation. Government ministers were fuming about the outcome. But Metalclad had claimed $43m and shelled out $4m on lawyers’ and other fees, so it was not happy either.

More investment and investment agreements means more disputes but the last thing anyone needs is a new dispute structure to deal with the situation. What is needed is cooler heads. Companies need to be sure that a high enough authority is aware of their problems – meaning the prime minister or president’s office if possible. That way, something is more likely to get done. Investment promotion authorities need to ensure they have as many resources being used on aftercare as on searching for new investment. One bad case can set their efforts back a decade.