Analysis: Why Ethiopia should avoid arbitration as a means of dispute settlement in a possible GERD deal
By Tessema Simachew Belay (PhD) @belay_s
Addis Abeba, June 29/2020 – Back in February 2020, after Ethiopia refused to sign the US drafted deal that Egypt immediately initialed, apparently unhappy about USA’s attempt to rush an agreement, the GERD negotiations were interrupted for some time. During the interruption, Egypt wrote a letter to bring the issue to the attention of the United Nations Security Council (UNSC) triggering Ethiopia and the Sudan to write their own responses to the same body.
A couple of months later, an initiative taken by the Republic of Sudan has managed to break the uncomfortable deadlock leading to the resumption of talks between the three countries. However, after weeks of bilateral and trilateral negotiations the talks were once again interrupted on 17th of June 2020.
Following this second interruption, in an attempt to put a diplomatic pressure on Ethiopia, Egypt wrote another letter to the UN Security Council on June 19, 2020. In this letter, Egypt claimed that “Ethiopia’s equivocation and implacable posture …led to the failure of the negotiations.” Egypt further accused Ethiopia for refusing to conclude “an agreement that would be binding under international law”. In an impassioned response to this accusation, Ethiopia wrote a letter to the UNSC on 22 June 2020, criticizing Egypt for following a “dual track approach…to exert unhelpful political and diplomatic pressure on Ethiopia”. However, the diplomatic pressure on Ethiopia appeared to have intensified after Sudan joined the conversation by writing yet another letter to the UNSC on June 24, 2020 claiming it was deeply concerned about Ethiopia’s decision to start filling the GERD in the absence of an agreement. As a result, despite some initial hesitation, the UN Security Council accepted a proposal presented by the USA on behalf of Egypt to have an open session to discuss the issue of GERD on Monday June 29, 2020.
Observing the escalation of the situation and in an apparent move to set the tone for the scheduled Security Council open session on the GERD, the current AU Chair, South African President Cyril Ramaphosa, hosted a video conference meeting of the African Union (AU) Extra Ordinary Bureau of the Assembly of Heads of State and Government on 26 June, 2020. The meeting was attended by all the Members of the Bureau including President Abdel Fattah al Sisi of Egypt. In addition, the PMs of Ethiopia and the Sudan have also participated up on the invitation of the Bureau.
At the end of the meeting, the Chairperson of the African Union Commission, Moussa Faki Mahmet, who also participated in the meeting, tweeted that the three countries “have agreed to an AU-led process to resolve outstanding issues.” A communique released by the Bureau of the Assembly on 27 June has also affirmed that noting the three countries have undertaken “to refrain from making any statements, or taking any action that may jeopardize or complicate the AU-led process” In a way that affirms the AU Bureau of the Assembly clearly aimed to set the tone for the scheduled Security Council open session, the Communique of the Bureau “request[ed]” the body “to take note of the fact that the AU is seized of this matter”.
It is commendable that the African Union has stepped up to lead the GERD negotiations on the outstanding issues in the spirit of “African solutions to African Problems”. However, it is not clear if the now augmented Tripartite Committee dealing with the GERD issue will be able to reach an agreement on the pending issues in a short time frame in a way that addresses Ethiopia’s deepest fear that the GERD deal could be a disguised water sharing scheme or end up being interpreted as such. This is why, at least from an Ethiopian perspective, the outstanding issues regarding legal matters should be approached cautiously.
One of the outstanding legal matters which in my view require a lot of caution is the issue of dispute settlement. Apparently, according to a report from the International Crisis Group (ICG) on 17 June 2020 entitled “Nile Dam talks: A Short Window to Embrace Compromise”, dispute settlement is one of the thorny issues in the GERD negotiation. According to the report, while Egypt and Sudan prefer binding international arbitration as a dispute settlement modality for any GERD deal, Ethiopia prefers diplomatic means such as negotiation. The Crisis Group report called for a compromise by asking both parties to modify their position suggesting an AU-led arbitration process as a solution.
Now that the three countries agreed to an AU-led process to resolve the outstanding issues, one may think the above ICG proposal could easily solve the controversy on dispute settlement. However, in this piece, I argue that since such proposals do not fully take into account why Ethiopia needs to avoid arbitration or any other form of binding dispute settlement mechanism, the Ethiopian negotiating team should approach them with a lot of caution. To make my case, after briefly explaining the position of contemporary international law on the issue of international dispute settlement, I will state why the nature of arbitration as a dispute settlement mechanism as well as the content of the obligation the GERD negotiation intends to create justify Ethiopia’s cautious approach on the matter.
International law does not oblige states to accept any specific form of international peaceful dispute settlement
Contemporary international law imposes on States a basic obligation to seek a peaceful settlement of disputes. The peaceful settlement of disputes is very much at the heart of the purposes and principles of the United Nations Charter. Article 2 paragraph 3 of the Charter provides that “All Members shall settle their international disputes by peaceful means.” Paragraph 4 of the same provision also provides that “all Members shall refrain in their international relations from the threat or use of force.”
Though the principle of peaceful dispute settlement is clearly enshrined in the UN Charter, the Charter does not impose any specific method of dispute resolution as the most preferred modality. Rather, Article 33 of the Charter simply provides a menu of options for dispute settlement. The provision reads:
The parties to any dispute, the continuance of which is likely to endanger the maintenance of international peace and security, shall, first of all, seek a solution by negotiation, inquiry, mediation, conciliation, arbitration, judicial settlement, resort to regional agencies or arrangements, or other peaceful means of their own choice.
The list of methods in the above article covers a spectrum of techniques ranging from those that give control of the outcome primarily to the parties themselves to those such as arbitration and judicial settlement that give control of the outcome primarily to a third party. Parties to a certain international dispute are therefore entitled to choose any one of the above or other means or a combination of them to solve the problem.
A question might arise as to what should happen if the parties disagree on which particular method they should use in order to solve their dispute. The answer is clear. They should keep negotiating to reach an agreement. No one party can impose its preferred modality of dispute settlement on the other party. Even when states are in agreement on the content of a certain negotiated norm, the modalities of dispute settlement will have to be further negotiated, and, in choosing from the various modalities, the states should be on an equal footing.
In conclusion, since as a matter of a well-established rule of international law, States are not under any international legal obligation to submit a dispute with other state to impartial arbitral or judicial settlement, it is Ethiopia’s sovereign right not to prefer arbitration as a preferred way of dispute settlement. But the question remains whether Ethiopia is justified to do so. I will now turn to that question.
Ethiopia has sufficient reasons to reject arbitration as a means of dispute settlement. The reasons have to do with both the nature of arbitration as a means of dispute settlement, the nature of the broader controversy regarding the Nile and the content of a possible GERD deal.
Arbitration creates winners and losers and Ethiopia still has untreated trauma because of it
Arbitration is an important dispute resolution mechanism that help disputants solve their problem with a binding decision in a process where they will have more control on the choice of the decision makers. However, just like judicial settlement, though it settles the dispute with a binding decision, it creates a win-lose situation. A party which may feel that there is an erroneous arbitration decision will have no real opportunity to correct it. As such, arbitration is not a good dispute settlement mechanism when the issue is politically sensitive and highly controversial.
One does not need to go far to find examples on how arbitration is not the ideal way to solve sensitive issues. The Ethio-Eritrean Border Commission decision can provide a very good example. Based on the evidences which were presented to it, the Border Commission gave Bademe, which was the flash point in the Ethio-Eritrean war, to Eritrea. Ethiopia, a country which actually won the war, was not willing to surrender Bademe, because, doing that would trigger a strong political opposition within Ethiopia. As a result, Ethiopia had to ask for further negotiations on the implementation of the Border Commission decision. Eritrea’s request for the immediate implementation of the decision of the Border Commission created a dead lock that continued for almost two decades. Many Ethiopians still regret signing the Algiers Agreement that inter alia created an arbitration commission to solve the border dispute. The unexpected final result of that process which gave Bademe to Eritrea remains to be an untreated national trauma. Hence, many Ethiopians are not willing to subject themselves to a similar situation on an issue as important as the Nile. In fact, though the involvement of the AU in the GERD negotiation is a welcome development, if the process leads Ethiopia to finally accept arbitration as a dispute settlement mechanism it would mean that history actually repeats itself. After all, the negotiation that led to the Algiers Agreement was facilitated by the OAU.
One could also wonder whether arbitration as a mechanism that creates a win-lose situation is in line with the spirit of the 2015 Declaration of Principles. The 1st principle of the agreement is “to cooperate based on common understanding, mutual benefit, good faith, win-win and principles of international law.” A continuous negotiation that is conducted in good faith is more in line with these lofty goals than arbitration. This fact was attested by dispute settlement mechanism favoured in the 2015 Declarations of Principles (DoP) agreed between the three countries. The DoP clearly favoured negotiation and other diplomatic ways of solving possible disputes.
But at this point one may wonder why the disadvantages of arbitration in creating winners and losers would specifically concern Ethiopia while Egypt and Sudan will also be parties to the GERD deal. This takes as to the next reason why Ethiopia could be rejecting arbitration as a dispute settlement modality.
Ethiopia has to make sure that any GERD deal is neither designed as a disguised water sharing arrangement nor it is interpreted as such
The GERD deal should not be seen in isolation from the long-standing controversy on the issue of water sharing on the Nile Basin. What both Egypt and Ethiopia want to preserve or avoid in the specific GERD deal is informed by the two countries’ diametrically different position on the issue of water sharing. Egypt wants to preserve its so-called historical right over the Nile Water. Ethiopia on the other hand is against this status quo. As a result, Ethiopia has to make sure that every agreement on the issue of Nile does not affirm the colonial era water sharing scheme which gives 0% of the Nile Water to Ethiopia despite it being the source of 86% of the water.
This is the main reason that makes both the issue of drought mitigation and dispute resolution very controversial in the negotiations. Egypt’s desire to make Ethiopia enter into a long-term detailed commitment on the amount of Water that would be annually released from GERD including when there is prolonged drought with a binding dispute resolution mechanism in place can be seen as a means to ensure what it considers its annual share of the Nile water. The fact that the agreement will apparently be about the “filling and operation of GERD” does not mean that it would not affect water sharing. The amount of water Ethiopia is expected to annually release from the GERD, if it does not take into account other possible future uses of the water upstream GERD, will indirectly mean that Ethiopia accepts the current water sharing arrangement.
The recent report by the International Crisis Group explains why Ethiopia is anxious about any detailed commitment. According to the report, Ethiopia believes: “any arrangement that potentially involves Ethiopia “owing” water to downstream countries would be appropriate only as part of a multilateral “water sharing” accord in which all eleven Nile riparian states commit to annual water use quotas.”
The absence of a comprehensive legal agreement governing water sharing in the Nile Basin is an additional reason for Ethiopia’s unwillingness to submit to arbitration. According to the above mentioned ICG Report, Ethiopia argues that, in the absence of such a comprehensive agreement, arbitrators would not have a legal arrangement on which to base a decision on water allocation issues. In other words, Ethiopia wants to avoid the possibility of arbitrators using the technical rules on filling and operation of GERD to reach at a conclusion which has permanent implication on water sharing. For Ethiopia, the issue of water sharing is much more important than the specific project of GERD as it would affect many future generations to come. As such, it is understandable that Ethiopia does not want to leave the issue to the mercy of arbitrators.
The Nature of any possible GERD deal makes arbitration unattractive option for Ethiopia
The GERD deal which is under negotiation, if concluded, is likely to become an anomaly in the field of international agreements. Normally, International agreements are of two types: contractual type agreements and normative agreements. Contractual type agreements impose reciprocal obligations. Parties to such agreements enter into a give-and-take arrangement on the basis of reciprocity. Normative agreements, on the other hand, create rules that parties apply without expectation of reciprocity. Human rights and humanitarian treaties are good examples. Obligations of the parties in such treaties should be discharged irrespective of whether the other parties are willing to do the same. Despite the differences in their nature, both contractual type and normative agreements are a source of uniform obligations to their parties.
However, a GERD deal will be unique. Most of the substantive obligations in a deal on rules and guidelines on filling and operation of the GERD will be imposed on Ethiopia. It is not to say that there won’t be some rules that will have reciprocal application. Some of the normative rules might also be uniformly applicable in the three countries. That however won’t change the essence of the deal as a tripartite deal that primarily imposes obligations on one of the parties, Ethiopia.
This is something people who suggest all the parties to “compromise” appear to give little attention for. Compromise is something that best works when all the negotiating parties have comparable things to gain or lose. That is not the case in any GERD deal because of the deal’s potentially unique nature in imposing most of its substantive obligations only on one of the parties. This is what makes Ethiopia uniquely vulnerable to an unfair deal.
Normally, when states negotiate to conclude international agreements that would impose uniform obligations, they are likely to be equally anxious about three dimensions of the norm they will be creating. Kenneth Abbott and Duncan Sindal call these three dimensions: Obligation, Precision and Delegation. First, regarding Obligation, the States will have to decide whether to make the agreement a binding treaty or a declaration. Second, they will have to negotiate and decide whether to include very detailed and precise obligations or simply put general principles. Finally, they will have to decide to what extent the monitoring and dispute settlement under that agreement should be delegated to a third party. Usually, when an agreement imposes strict obligations, States are less inclined to push for very precise rules and a monitoring or dispute settlement mechanism with significant delegated authority.
However, due to the unique nature of a deal on the filling and operation of GERD, Egypt and Sudan are pushing for maximalist outcome in all the three dimensions referred above. The two countries prefer the GERD deal to contain strict Obligation (binding treaty), have high Precision (detailed rules on filling and operation) and high Delegation (dispute settlement with a binding outcome). Egypt in particular argues that a deal that does not contain it maximalist choices in all the three dimensions is not a “fair deal”.
As the duty bearer to most of the obligations in any possible GERD deal, signing up for arbitration as a possible dispute resolution mechanism would only be very burdensome for Ethiopia. This burden should also be seen in light of the diplomatic behavior Egypt is exhibiting in the ongoing negotiations. Egypt is practically trying to use every means to put pressure on Ethiopia to accept a deal that satisfies its interest. For example, circumventing the dispute resolution mechanism set out in the 2015 Declaration of Principles, Egypt is repeatedly going to the Security Council in search of a decision that is favorable to itself. In light of this, if an agreement which includes arbitration as a dispute settlement mechanism is agreed upon, Egypt is likely to turn that into a forum of harassment. Hence, Ethiopia is justified to resist such an option. This is neither bad faith nor a sign of a desire to not be bound by the commitments that would be enshrined in a potential GERD deal. It is a way of preserving sovereignty by avoiding a potentially win-lose situation on a politically sensitive issue like the Nile.
Conclusion
An AU-led negotiation to solve the outstanding legal issues regarding the GERD in the spirit of the principle of “African Solutions for African Problems” is commendable. However, the efforts to solve the controversial issues should take into account the unique nature of any possible GERD agreement. Ultimately, despite its tripartite framework, a deal on the filling and operation of the GERD will be an agreement that imposes almost all of its substantive obligations on Ethiopia. Calls for compromise on the various aspects of the outstanding issues should therefore take this unique nature of the deal into account.
Similarly, Ethiopia’s preference to avoid arbitration as a dispute settlement modality in any potential GERD related dispute should be seen in light of its desire to prevent any win-lose scenario on the politically sensitive issue of the Nile, its legitimate interest to make sure the deal is not interpreted as a water sharing scheme and its right to prevent dispute settlement processes from being used as forums of judicial harassment. AS
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Editor’s Note: Tessema Simachew Belay (PhD) is a faculty member at Bahir Dar University School of Law. He can be reached at: tessim43@gmail.com
