Tanzania, British developer head back to ICSID after stalled talks
The Citizen | 22 January 2025
Tanzania, British developer head back to ICSID after stalled talks
By Paul Owere
Tanzania and British developer Pennyroyal Limited could find themselves back to the International Centre for Settlement of Investment Disputes (ICSID) after talks between the two parties failed to yield an agreement. Although the specifics of Pennyroyal’s demands remain unclear, the project in question, was originally valued at $1.6 billion (approximately Sh4 trillion) upon completion.
The Citizen has reliably learned that no agreement had been reached by the expiry of the ICSID deadline, with no new offers put forward to resolve the ongoing investment issue. In July 2024, ICSID extended the suspension of proceedings between Pennyroyal and the Tanzanian government to allow both sides to pursue negotiations for an out-of-court settlement.
This extension expired on January 12, 2025, but it appears the negotiations did not reach a resolution.
Attempts to reach officials from both the Attorney General’s office and the law firm representing Pennyroyal for comments on the status of the talks were unsuccessful.
The dispute stems from the Tanzanian government’s appropriation of 411 hectares of land in Matemwe, Zanzibar, which was originally leased to Pennyroyal for its Blue Amber Resort project. The case was registered in July 2023, with the tribunal’s first session held on December 14, 2023.
Details on the ICSID website reveal that the first suspension of proceedings was agreed upon by both parties from April 29 to July 16, 2024.
In July 2024, Tanzania’s then Solicitor General confirmed that talks were ongoing but withheld further details on the status of the arbitration process confirming that Government Negotiation Team (GNT) was established to handle the matter.
If a settlement is eventually reached, it would mark Tanzania’s third out-of-court resolution in under a year.
