"Singapore's Image as a Neutral Country"
Optimal Base for Attracting India and Vietnam as ICSID Member States
Physical Proximity Makes It the Ideal Hub
The International Centre for Settlement of Investment Disputes (ICSID), under the World Bank, has opened its first regional office in Singapore, despite the relatively low proportion of cases from Asia. This move is interpreted as a strategic decision betting on the region's explosive growth potential in the future. As of June 2025, Southeast Asia and the Pacific accounted for only 6% of ICSID cases by country and 14% by investor, which is not especially high compared to other regions.
Kim Gapyu, Managing Partner at Peter & Kim and a graduate of the 17th Judicial Research and Training Institute, stated, "Asia is the only region in the world where the economy is still growing. Economic growth naturally leads to more disputes, and in fact, the number of arbitration cases in Asia is increasing."
Lee Hyungkeun, attorney at Kim & Chang and a graduate of the 34th class, also cited several reasons: the massive movement of capital related to Asia, the growth potential of a region where 60% of the world's population lives, and the large number of Asian countries that have signed 'investment agreements' forming the basis for disputes.
The choice of Singapore among various Asian cities is also considered a strategic decision. Attorney Lee Hyungkeun explained, "Singapore's image as a neutral country is a major advantage as a venue for resolving international disputes." Additionally, Singapore's physical proximity makes it the optimal base for attracting major countries in the region, such as India and Vietnam, which have not yet joined the ICSID Convention, to become member states.
ICSID's expansion into Asia is also a positive development in light of Korea's changing role in investor-state dispute settlement (ISDS). In the past, Korea was primarily a 'respondent state' facing lawsuits from foreign investors, but now Korean companies are increasingly acting as 'investor states' filing claims against foreign governments. Recent cases include Korea Mine Rehabilitation and Mineral Resources Corporation initiating arbitration against Panama, and Korea National Oil Corporation filing for investment arbitration against Nigeria.
This shift is also impacting the work of domestic law firms. An international arbitration expert explained, "In the past, our work mainly involved defending the Korean government in ISDS cases brought by foreign investors. Now, the trend is to develop strategies from the perspective of Korean companies utilizing ISDS as investors."
Kim Jisoo, Legal Times Reporter
※This article is based on content supplied by Law Times.
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