Commentary
Was Cariforum wise in rushing into a ‘Full’ EPA?
Norman Girvan
27 October 2010
Recent
news on the stalemate in the EPA negotiations in Southern Africa raises fresh
questions about the wisdom of Cariforum countries in rushing to sign on to a ‘Full’
EPA with Europe in October 2008.
According to an article in one of the region’s
leading newspapers (attached below), the EPA negotiations with SADC—the Southern
Africa Development Community—are unlikely to meet the latest deadline for
conclusion at the end of 2010.
That
will make three years since the expiry of the original deadline of December 31,
2007 for conclusion of a trade agreement to take the place of the Lome/Cotonou
arrangements. We in the Caribbean had been told that this deadline was cast in
stone.
One
of the main sticking points in the EU-SADC negotiations is EU insistence that “new
generation issues” be included in the EPA, even though this is not required
under WTO rules. New generation issues include investment, government procurement, competition policy and expansion of intellectual
property rights and of trade in services.
The article quotes Namibia’s Director of
International Trade as saying that “if we agree to EU demands on new generation
issues we would be opening up our economies to very serious problems”. Two major
concerns mentioned are the restriction of the right of SADC nations to pursue their
own development strategies and the undermining of their regional integration
schemes.
A Communiqué from an EPA Workshop of African
Trade Unions and the International Trade Union Confederation (ITUC) explains
these issues in some detail. African development and transformation should be anchored
on agrarian reform and industrialisation, supported by regional integration and
South-South cooperation. The present design of the EPAs is not consonant with
this strategy.
Inclusion of new generation issues was one
of the controversial features of the Caribbean’s EPA. Critics had argued that more
time was needed to consider the implications for development and regional
integration.
SADC has apparently also forced the EU to concede
ground on its demands for a ‘Most Favoured Nation (MFN) Clause’ whose effect
would be to hinder South-South cooperation. The MFN clause was bitterly opposed
by Cariforum, but the position of European negotiators was ‘take it or leave it’.
Now it seems the Caribbean might have won that
battle had they made common cause with the Africans.
Cariforum negotiators have always argued
that being the first to conclude a ‘Full’ EPA with Europe would be an advantage
in securing additional development assistance and enhanced access to EU service
markets.
It is an open secret however, that
implementation of the EPA by most Cariforum countries is well behind schedule
because of the onerous legislative, regulatory and administrative obligations
and the limited financial means of many countries.
Nearly three years after the conclusion of
negotiations, some reassessment of the Caribbean strategy now seems to be necessary;
comparing the recent Caribbean and African experiences.
In addition, the fall-out from the global
economic crisis has devastated the financial resources of EU states, which must
impact their aid budgets.
And how accessible will European service
markets really be, with slow economic recovery and rising unemployment in
Europe?
27 October 2010.
By
Felix Njini ; 22-10-2010
http://www.
Windhoek
– SADC's hope for a conclusion of negotiations on a new economic partnership
agreement (EPA) with the European Union (EU) before December is fizzling out as
new demands from the EU threaten to scupper chances of a new trade pact.
Southern African Development Community countries are currently trading
with the EU on preferential terms without legal backing following the expiry of
the old trade deal in 2008.
African states have been negotiating for a new trade pact with the EU since
2002 when the Cotonou Agreement ended.
Negotiations have stalled, first with the SADC countries rejecting an initial
draft which they argued are heavily tilted in favour of the EU.
Annascy Mwanyagapo, Director of International Trade in Namibia's Ministry of
Trade and Industry expressed doubt that a pact would be sealed soon.
In any case, Mwanyagapo told The Southern Times that the EU indicated at the
negotiators' last meeting in Johannesburg early this month that 'time is not of
essence' as it tries to push through a raft of new generation issues such as
government procurement, services, competition policy and intellectual property
rights.
Insistence by the EU on the new generation issues clause could scupper chances
of parties ever reaching an agreement.
Mwanyagapo said Namibia's position is that the new generation issues
should be off the table as they were not on the agenda.
'If we agree to EU demands on new generation issues we would be opening up our
economies to very serious problems. Even in the World Trade Organisation (WTO),
this issue is still being negotiated. We have not finished the process at
multilateral level, so we can't have them at regional level. We can't jump the
gun.'
The EU conceded ground on the most favoured nation (MFN) clause and has agreed
to implement an agreement struck at the Swakopmund meeting in 2008.
The EU is backing down from its earlier position on the MFN that any trade
concessions given to countries that contribute more than 1.5 percent of world
trade in future be extended to the EU.
SADC countries accused the EU of limiting African economies' scope when
negotiating with emerging markets such as China, India or Brazil.
'It looks like the EU initially wanted to test how far we would go and they
started with softer issues. Any trade pact has to allow for our long term
developmental plans be it Vision 2030 or regional indicative strategic
development plan (RISDP). The EU cannot limit our policy space,' Mwanyagapo
said.
Most SADC countries have refused to negotiate on new generation issues and
signing a deal with the EU on the contentious new generation issue will
undermine regional integration.
South Africa, Namibia and Angola are said to have refused to open talks on new
generation whilst Botswana and Swaziland, under the SACU bloc would want to
negotiate with the EU.
'To say a deal will be signed end of the year is quite ambitious,' Trade Law
Centre for Southern Africa (Tralac) executive director Trudi Hatzernberg told
The Southern Times.
Resistance from former European colonies in Africa, the Pacific and Caribbean
has back-footed the EU, which is still battling the effects of the 2008 global
financial crisis.
Hatzernberg said that the EU can no longer force its hand in Africa without
losing ground too China, whose competitive streak has also become a domestic
problem within the EU market.
China is also turning the tables against the former colonial power in Africa,
whose enormous mineral wealth has hardly been exploited.
'Africa on the EU agenda is not as important as three or four years ago plus
Europe now has its own challenges to deal with. The Chinese factor is one-lots
of Chinese products are going into EU. But because of China's role in Africa,
they (EU) don't necessarily want to be squeezed out by China.'