Originally from Revolution in the International Rule of Law: Essays in Honor of Don Wallace, Jr.

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I. Introduction

States often have more than simply altruistic intentions when
participating in the international development regime. Decisions to vote
for or against international development loans more often than not have a
political element and indeed play an important role in a State's foreign
policy. In honor of Professor Don Wallace, Jr., who "specializes in the
fields of international law and foreign affairs,"1 this contribution examines
the interdisciplinary issue of the use of international development loans to
secure compliance with investment arbitration awards.

This issue should be of interest to both practitioners and scholars as
foreign investors periodically allege that States fail to comply with
investment treaty awards. In recent years, for example, foreign investors
have criticized certain States, including Argentina, Congo, Kazakhstan,
Kyrgyzstan, Liberia, Russia, Senegal, Thailand, and Zimbabwe, for
purportedly refusing to pay investment arbitration awards.2 In turn,
foreign investors occasionally lobby their home States to exert
diplomatic pressure on allegedly recalcitrant host States. In some
instances, the foreign investor receives "scant support" from his home
State, such as Franz Sedelmayer in his long-running attempt to persuade
the German Government to assist him in securing payment of his award