If the EU’s trade policy is to fulfil its potential as a “powerful instrument for African development”, its system of economic partnership agreements (EPAs) needs a rethink, argue Kalypso Nicolaïdis and Paul Collier for Open Democracy.
The January analysis highlights the “intense controversy” surrounding the EU’s practice of negotiating EPAs with the ex-colonies of its member states, referred to as the ACP (African, Caribbean and Pacific) nations.
EPAs are special trade agreements which offer preferential market access and support for commodity prices and, in the authors’ view, serve as an “instrument for post-colonial atonement”.
Nicolaïdis and Collier argue that the EPAs must be reformed to make them compatible with World Trade Organisation (WTO) rules. A temporary accord was struck following the expiry of a waiver at the end of 2007, but the existing EPAs are in essence illegal, as they are neither reciprocal nor provided to developing countries on a non-discriminatory basis, they claim.
Thus there is an opportunity for “a welcome rethink” in 2008, state the authors. ACP countries, and particularly African ones, need a “credible means” of locking in their own future policies and “the reciprocity requirement of EPAs can provide such insurance” in the eyes of the world, they believe.
Nicolaïdis and Collier argue that ACP countries should apply most-favoured nation treatment to their liberalisation plan and negotiate EPAs with this in mind in order not to be discriminatory by setting lower tariffs on goods imported from Europe – a move which “would also be in Europe’s long-term interest”.
Moreover, they believe that ACP countries need improved market access to Europe, calling in particular for changes to the current scheme’s “highly restrictive” rules of origin, which stipulate that “70% of content must be local” and prevent Africa from realising its manufacturing export potential.
Nicolaïdis and Collier conclude that the EPAs of the future must not force African governments to embrace policy change in which they do not believe in return for EU aid.
Moreover, EPAs should not be a device for the EU to “reintroduce issues like investment, procurement, trade in services or intellectual property” into the debate, they add.