[DEBATE] : (Fwd) Did Africa really say no in Lisbon? (cont.)
pbond at mail.ngo.za
Sun Dec 30 09:54:31 GMT 2007
(Kwa lists Namibia, Cote d'Ivoire and Kenya. Are others saying yes too?)
FOCUS ON TRADE
NUMBER 135 DECEMBER 2007
EU IS USING ''BULLY TACTICS'' TO PUSH THROUGH EPAS
By Aileen Kwa
"We succumbed," lamented a diplomat from Namibia. "We signed on the 12th
of December. The pressure was too much. The private sector felt that
they would be disproportionately affected. In terms of markets, they
would be losing access for beef, grapes, fish and fish products."
"The political and economic strength of the European Commission [EC] is
in itself a threat and a pressure in the negotiations," he explained on
condition of anonymity.
"When negotiating with a stronger partner, you end up only being on the
receiving end. Bully tactics are used with the threat 'you either sign
or you don't have the market'," he said.
Up to the last moment, Namibia's government had tried to resist the
pressures from both their own private sector and the EU. Until late last
week, trade minister Immanuel Ngatjizeko had categorically stated that
the demands the EPA placed on Namibia were "not acceptable".
He insisted that the EPA should be helping with "regional integration
and not to disintegrate" the region.
"We made a lot of mistakes," the diplomat told IPS. "There was no proper
coordination amongst the African, Caribbean and Pacific (ACP) countries.
The EC has successfully fragmented the ACP, not only in terms of
regions, but also within regions."
The Southern African Development Community (SADC) consists of 15
countries. "While we used to get EU development aid for the region as a
whole, now only seven SADC countries (those party to the SADC EPA) will
get development aid that is related to the EPAs. This will have
The intra-SADC free trade area is also supposed to be formalized by
2008. How this will play out, with some countries being signatories to
the EPAs while a country such as Angola chose not to sign the EPA,
remains to be seen.
The Namibian diplomat was quick to add that whilst the country had
signed the interim EPA on December 12, it had done so with explicit
reservations on certain clauses. "If these concerns are not
satisfactorily addressed in the next phase of negotiations, then we can
say that we are not in a position to ratify the final agreement and opt
out. But in the meantime, we need to do other things, such as finding
The problem is that Namibia, Lesotho, Botswana, Swaziland and South
Africa have a common customs union -- the Southern African Customs Union
(SACU), established in 1910. Lesotho, Botswana and Swaziland have signed
the SADC EPA which contains clauses that Namibia is not comfortable with.
One of these clauses restricts local content requirements in the
manufacturing sector. In order to support local industries, Namibia does
not want to abolish any legislation that requires investors to use
locally produced inputs. Another clause deals with the freezing of
export taxes. The EC does not want ACP countries to put in place export
taxes. Namibia, however, wants the freedom to use export taxes to
discourage the export of raw materials and to encourage local industries
to add value to their products before export.
The EC has asked SADC countries to provide it with the same level of
market access SADC gives to other significant trade partners. SADC is
currently negotiating free trade agreements with India and with the
MERCOSUR. MERCOSUR is the Southern Common Market trade area which
includes Brazil, Paraguay, Argentina and Uruguay.
If more favourable terms of market access are provided in these and
other future trade agreements, the same level of liberalization will
have to be extended to the European Union (EU).
The SADC EPA also states that goods entering any one of the SADC EPA
signatories should be allowed to move freely to the other signatory
countries. However, SADC has yet to formalize its own regional customs
union. There are still issues to be sorted out internally.
In contrast to countries which have caved in and signed the interim
EPAs, Senegal in West Africa remains steadfastly opposed to the EPAs. An
expert from Senegal, who declined to be named, commented on President
Abdoulaye Wade's firm stance taken at the Africa-EU Summit in Lisbon
earlier this week.
"He was simply reflecting the national position. The private sector,
civil society, parliament and the opposition are all opposed to the
EPAs. To have an EPA right now will create a lot of problems for our
economy. It will open our markets to products from the EU, some of which
are subsidized," said the Senegalese trade expert.
"Senegal is a least developed country. The industry and agricultural
sectors are not ready to compete with the EU on a level playing field.
In the next phase of EPA negotiations, we would also have to bring in
investment, competition and government procurement, issues which have
been rejected at the WTO (World Trade Organisation).
"So the EPAs are WTO-plus. On the other side, in development
cooperation, we are not sure that what is on the table can offset any
negative liberalization impact," said the expert.
He also underscored the problems the EPA poses for the West African
region, in particular the West African Economic and Monetary Union (WAMU
/ UMOA). The monetary union consists of eight members -- Senegal, Benin,
Burkina Faso, Cote d'Ivoire, Mali, Niger, Togo and Guinea-Bissau.
Of these, Cote d'Ivoire is the only country which has signed the interim
EPA in an attempt to safeguard its banana exports to the EU. The country
is the main economic powerhouse within WAMU, accounting for 40 percent
of the union's gross domestic product.
According to the Senegalese expert, "Cote d'Ivoire's signing of the
interim EPA will definitely have an impact on WAMU." Given the high
level of economic integration in that region, EU products flowing into
Cote d'Ivoire can easily find their way into the other WAMU countries.
"I don't think they (the EU) did an impact assessment on regional
integration," he said.
He also underscored the tensions the EPA negotiations have created for
the WTO negotiations. "They have put the LDCs (least developed
countries) in a very bad position in the WTO. Since the 2005 Hong Kong
ministerial meeting, LDCs have asked for duty-free and quota-free market
access to all developed countries.
"Under the EPA, the duty-free and quota-free market access is
reciprocal. Now other countries will say, 'You have given this to the
EU, now you will also have to give me something in return'," he said.
"So there are many unanswered questions and a lot of uncertainty," he
Kenya has also signed an EPA, together with others from the East African
Community. A trade diplomat from Nairobi, alluding to the threats the
EPAs pose for Africa, summed the position up in the following way: "They
say love is blind. This must be real love because we are going along
without knowing where we are going."
Kenyan civil society groups are working hard to make the EPAs a major
issue in Kenya's national elections taking place later this month.
According to Ezekiel Mpapale of the Initiatives for Community and
Enterprise Development, "One of the things we are doing is to make sure
that Dr Mukhisa Kituyi (the current trade and industry minister) is not
re-elected. We think he has betrayed us Kenyans."
* Aileen Kwa is an independent trade policy consultant. Her main
activities include research, writing and training on trade and
alternative economic policies. She is co-author of 'Behind the Scenes at
the WTO', and author of 'Rethinking the Trading System'. She is
currently on leave from Focus on the Global South. This article was
first published by Inter Press Service, IPS.
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