It has been asserted by Gunnar Myrdal, the renowned Swedish economist, that one of the three major obstacles to the satisfactory progress of international economic cooperation and integration is that the methods of settling international disputes are ineffective and primitive.That the lack of adequate institutional facilities for the settlement of investment disputes has in particular hampered the flow of capital from the affluent to the developing nations (at a time when the revolution of rising expectations so extensively depends upon it) cannot be seriously doubted. As pointed out by one writer: “It does not appear realistic to expect a foreign investor to allow adjudication of his grievance before a tribunal of the nation in which the grievance arises, or before a tribunal of a nation allegedly causing the grievance… For similar reasons, a nation which is a party to a grievance will not normally allow its rights to be adjudicated by a tribunal of a nation of which a complaining foreign investor is a national.”
