New EU-Africa pact must deepen trade ties, minister says

The EU and African Union must use a new ‘strategic partnership’ to deepen their trade and investment relations. That was the main message of a EURACTIV event focusing on what is likely to emerge from discussions between the two blocs.

The EU and African Union must use a new ‘strategic partnership’ to deepen their trade and investment relations, participants agreed during a EURACTIV event focusing on what is likely to emerge from discussions between the two blocs.

One of the main priorities of African governments from the process is to secure improved trade terms that will enable them to develop domestic and regional manufacturing with a view to increasing exports to the EU.

“It is our hope that the new partnership will create new global value chains, to increase exports of finished goods,” Botswana’s trade and industry minister, Peggy Serame, told the event, pointing out that most of sub-Saharan Africa’s exports to the EU are raw materials rather than finished products.

The EU-African Union summit scheduled for October was postponed because of the COVID-19 pandemic. On 16 October, European Council President Charles Michel told reporters that the summit would now be held in December.

“It will be the occasion to renew our partnership and even our alliance with Africa, this alliance is natural for geographic reasons, for historical reasons, for cultural reasons. There is a huge potential, if we take, together with the African leaders, the right decisions,” Michel added.

Leaders will also discuss the COVID-19 pandemic, said Michel, adding the “regional cooperation and coordination at the level of the heads of states and the heads of governments” between EU countries will be strengthened.

The postponement of the summit has given both sides additional time to hone their main demands and revise the European Commission’s paper on the new ‘EU-Africa Strategy’ published in March.

Serame said that infrastructure, ICT, energy, and agriculture can all benefit from increased EU investment, adding that her government was committed to improving the ease of doing business, and would continue to open up Botswana’s economy to encourage foreign investors.

Botswana is one of the few African countries that is yet to ratify the African Continent Free Trade Agreement (ACFTA), though Serame said it was in the process of doing so.

Ambitious

“I would like to see a very ambitious set of outcomes from the next EU-AU summit,” said European External Action Service policy officer Ondrej Simek, who pointed out that, with the next seven-year EU budget set to be finalised in the coming months, the Commission is preparing the next programme stage for development assistance.

Simek also mooted the possibility of bilateral agreements with African countries.

Philomena Apiko, a policy officer at the European Centre for Development Policy Management, said that the EU-African partnership should also focus on education and skills.

Much as Botswana has a skilled labour market, there is still a miss-match of skills and an unemployment problem,” she said, adding that “without real transformation, there is a need to attract genuine job-creating investment”.

Integration

Regional integration was also cited as key to increasing intra-African trade and the prospects of European investment.

In this vein, Gabusamang Keebine, the president of Business Botswana, pointed to a series of transport projects aimed at improving connectivity with Namibia and South Africa, which is going to boost business development.

“We need to ensure that our businesses are in a position to export,” he said.

Keebine added that African governments need to do more to ensure that products made by local firms meet EU and international standards and have traceable supply chains. “We often find that the big retailers don’t always take goods from our domestic companies,” he said.

That was echoed by Philomena Apiko, who urged African governments to make better use of existing regional trading blocs as well as ACFTA.

Apiko also called for leaders to agree on “a mutually beneficial alliance on climate change and migration”.

Keletsositse Olebile, chief executive of Botswana Investment and Trade, said his country can be “a gateway for investment flows into Africa” and his organisation is already looking at ways to facilitate European investors into the Southern African Development Community and the rest of sub-Saharan Africa.

The pandemic is also expected to see a sharp reduction in African imports of agricultural produce as countries across the continent see the importance of being self-sufficient, after experiencing major disruption to trade supply chains while governments sought to contain the spread of COVID-19.

“We’ve learned the lesson of food sustainability from the pandemic,” said Olebile.

[Edited by Zoran Radosavljevic]

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