No rhyme nor region

Europe’s insistence on trade agreements with regions rather than nations ignores the different needs of developing countries, says Helmuth Markov

Development cannot be improved by trade alone but good traderelations have to be seen as a crucial factor for development to work. On thatkey point participants in a recent information session in parliament oneconomic partnership agreements (EPA) were in full agreement. The debate,organised by parliament and the commission, also highlighted the fact thatcountries and regions of the African-Caribbean-Pacific region face verydifferent situations in terms of development, integration and their specificneeds.

So far, a comprehensive EPA has been concluded between theEU and the Caribbean region. The chiefnegotiator, ambassador Cuello Camillo of the Dominican Republic, said this newagreement is the best deal the region could have negotiated within the timeframe available before the expiry of the World Trade Organisation-organisedwaiver for the Cotonou Agreement. That waiver had been given until 1 January2008, which was the deadline to ensure EU-ACP trade deals were in compliancewith WTO rules. Without a new agreement, he added, the region would have facedopen competition in its trade with the EU.

Speaking at parliament’s debate, EU trade commissioner PeterMandelson reiterated his optimism that EPAs with all ACP regions could besecured within a short time frame. But the reality of achieving this wouldappear to be somewhat difficult. African countries - even within their ownregions - have different economic structures, different trade needs anddifferent export interests. Regions also overlap and are not necessarilycongruent with the regional blocks the commission has declared to benegotiation partners for EPAs.

In West Africa, for example, Ghanaand Ivory Coastare the only two countries which have initiated an EPA.  Both are to a large extent dependent onexports to the EU and are not among the least-developed countries that arecovered by the so-called ‘Everything But Arms’ initiative (EBA). As such, Ghana and Ivory Coast felt the need to ensuremaintaining trade preferences given by the EU by signing interim agreementswith the bloc.

But as Amadou Koné, chief negotiator for Ivory Coast reminded us, a sufficient level ofregional integration would be a pre-requisite for a full EPA with the region, aview shared by Maria Manuela Lucas, ambassador of Mozambique. SADC, of which Mozambique is a member, also opted for aninterim agreement, but neither Angolawhich is covered by EBA, nor South Africa (which has a trade, development andcooperation agreement with the EU) have joined it. In the past it has beenargued that such ‘patchwork’ EPAs could disrupt regional integration anddevelopment processes rather than contributing to better south-south traderelations.

Another fear, also expressed by Maria Lucas, is that ACPcountries, already highly dependent on budget aid, would lose an essential partof their public revenue if they were to reduce their tariffs. Lucas, therefore,insisted on further negotiations about the possibility of EU compensation. Itseems clear to me that in order to really contribute to development in ACPcountries, the EU has to be more responsive to the needs of economically weakerpartners. Manuel López Blanco, acting director for DG development, recentlysaid the EU is ready to finance studies which help partner countries. It’s agood start but more is needed.