EU has put Africa between a rock and a hard place
Dec 19, 2007
THE EU-Africa summit that took place in Lisbon 10 days ago has been criticised for not delivering concrete outcomes. However, it did do one useful thing: it highlighted the massive problems and tensions that exist because of the trade agreements Europe wants to finalise with 76 African, Caribbean an
By Phil Bloomer
THE EU-Africa summit that took place in Lisbon 10 days ago has been criticised for not delivering concrete outcomes. However, it did do one useful thing: it highlighted the massive problems and tensions that exist because of the trade agreements Europe wants to finalise with 76 African, Caribbean and Pacific countries by the end of the year.
At the time of writing, 15 countries, 13 of them in Africa, had initialled far-reaching deals that threaten to split regions apart. But more than 60 countries are still holding out, and at the summit —ironically with a theme of partnership - there were strong voices raised in opposition, notably from Senegal’s President Abdoulaye Wade.
The so-called Economic Partnership Agreements—or EPAs —being negotiated between the EU and its former colonies, are about anything but partnership. They are harsh reciprocal trade arrangements that demand that some of the poorest countries in the world open their markets to EU goods, in some cases almost overnight.
Until now, many countries have held out against the pressure, but as the deadline approaches, some are giving in —choosing to guarantee existing exports at the expense of future industrial development and subsistence farmers’ livelihoods.
Ivory Coast’s signature on December 7 was particularly disappointing. The West African bloc barely had the draft text on the table and suddenly, one of their most powerful members has broken away and signed a free trade agreement with the EU — the region’s largest trading partner.
The text was brand new, written by the European Commission and seen for the first time in the region only a few days before. There had been no public consultation, just a series of high level diplomatic missions flying in from Europe telling the politicians to sign or see their export sectors collapse in three weeks’ time due to a massive hike by Europe in their import taxes.
Nigeria has flatly refused the agreement, as has Senegal. Ghana is still holding out. All last week Ghanaian officials were in urgent and tense discussions with a high level delegation that had flown in from the European Commission. European powers have also exerted pressure behind the scenes, taking the President aside for one-on-one talks to ‘discuss’ what is in his best interests.
After decades of attempts at regional integration and efforts to foster stability in one of the world’s poorest and most unstable regions, it seems that Europe and the Commission feel they need to impose what is ‘good’ for the region once again.
Five East African countries were the first to sign, splitting from their neighbours two weeks ago, abandoning a text that had been several years in the negotiating, to initial the brand new text the European Commission placed in front of them. Then the four smallest countries in southern Africa broke away from their neighbours, plunging the world’s oldest customs union into crisis.
Papua New Guinea followed suit, veering away from the Pacific Islands with whom it has negotiated for the past six years. Only the Caribbean and Central African regions’ negotiating teams remain intact.
It wouldn’t be so bad if the content weren’t so disturbing. Countries are signing up for full-scale liberalisation with their largest trading partner, opening up between 80 and 97% of trade with Europe in a space of just 10 to 15 years. They are agreeing to freeze all tariffs immediately and then eliminate their export taxes. They are systematically giving away much of what they have fought for at the World Trade Organisation.
Some are even guaranteeing Europe that she will never have less favourable access to their markets than her major competitors —China, Brazil and the US. This goes further than the trade liberalisation Africa saw under structural adjustment, which wiped out industries in the 1980s, policies that the World Bank later regretted. However, unlike in the 1980s, now even the free traders accept that rapid and poorly thought-through trade liberalisation brings inequality and destroys industries. So there really is no ‘development’ smokescreen to hide behind. But like in the 1980s, the conditionalities here also bite.
The agreements contain strong dispute settlement mechanisms through which Europe can make very sure that countries comply.
What is worse, none of this was necessary. It is not as if politicians in developing countries don’t know that these agreements are bad. They know, but for many, the only alternative they see is worse. Europe has put them between a rock and a hard place.
Countries are signing up to avert imminent disaster in their export sectors. The costs of the free trade agreements lie squarely in the future, while the costs of not signing are only a couple of weeks away. Plus, at the end of the day, when nearly half of your government budget comes from Europe and a $100m a year directly from the European Commission, it can be hard to say ‘no’.
This is the case for Mozambique, one of the poorest countries in the world. As the dust settles after Lisbon, one thing is abundantly clear. After decades of building an effective trade and aid partnership between Europe and Africa, there is no longer a genuine partnership in trade. Contrary to Europe’s claims, its threat to raise tariffs on January 1, 2008 is not a legal imperative. It is a choice. Pure and simple. Any development-minded minister from any EU member state must see that and must do something about it —now—before it is too late.
The Lisbon summit must be a wake-up call for the politicians who have been slumbering while European technocrats crowbar ever-harsher demands into intrinsically unfair deals. The threat to raise tariffs should be removed, and countries that have not signed EPAs must be reassured that they will not be left worse off after January 1.
Those who have initialled interim deals should be given the opportunity to review and if necessary, renegotiate, potentially damaging clauses. Any less than this will leave the EU with the uncomfortable legacy as the power that undermined Africa’s chances for future prosperity and denied the continent the opportunity to use trade to help lift people out of poverty.
The writer is Director of Campaigns and Policy at Oxfam on the latest developments in negotiations of free trade agreements between the EU and African, Caribbean and pacific countries
THE EU-Africa summit that took place in Lisbon 10 days ago has been criticised for not delivering concrete outcomes. However, it did do one useful thing: it highlighted the massive problems and tensions that exist because of the trade agreements Europe wants to finalise with 76 African, Caribbean and Pacific countries by the end of the year.
At the time of writing, 15 countries, 13 of them in Africa, had initialled far-reaching deals that threaten to split regions apart. But more than 60 countries are still holding out, and at the summit —ironically with a theme of partnership - there were strong voices raised in opposition, notably from Senegal’s President Abdoulaye Wade.
The so-called Economic Partnership Agreements—or EPAs —being negotiated between the EU and its former colonies, are about anything but partnership. They are harsh reciprocal trade arrangements that demand that some of the poorest countries in the world open their markets to EU goods, in some cases almost overnight.
Until now, many countries have held out against the pressure, but as the deadline approaches, some are giving in —choosing to guarantee existing exports at the expense of future industrial development and subsistence farmers’ livelihoods.
Ivory Coast’s signature on December 7 was particularly disappointing. The West African bloc barely had the draft text on the table and suddenly, one of their most powerful members has broken away and signed a free trade agreement with the EU — the region’s largest trading partner.
The text was brand new, written by the European Commission and seen for the first time in the region only a few days before. There had been no public consultation, just a series of high level diplomatic missions flying in from Europe telling the politicians to sign or see their export sectors collapse in three weeks’ time due to a massive hike by Europe in their import taxes.
Nigeria has flatly refused the agreement, as has Senegal. Ghana is still holding out. All last week Ghanaian officials were in urgent and tense discussions with a high level delegation that had flown in from the European Commission. European powers have also exerted pressure behind the scenes, taking the President aside for one-on-one talks to ‘discuss’ what is in his best interests.
After decades of attempts at regional integration and efforts to foster stability in one of the world’s poorest and most unstable regions, it seems that Europe and the Commission feel they need to impose what is ‘good’ for the region once again.
Five East African countries were the first to sign, splitting from their neighbours two weeks ago, abandoning a text that had been several years in the negotiating, to initial the brand new text the European Commission placed in front of them. Then the four smallest countries in southern Africa broke away from their neighbours, plunging the world’s oldest customs union into crisis.
Papua New Guinea followed suit, veering away from the Pacific Islands with whom it has negotiated for the past six years. Only the Caribbean and Central African regions’ negotiating teams remain intact.
It wouldn’t be so bad if the content weren’t so disturbing. Countries are signing up for full-scale liberalisation with their largest trading partner, opening up between 80 and 97% of trade with Europe in a space of just 10 to 15 years. They are agreeing to freeze all tariffs immediately and then eliminate their export taxes. They are systematically giving away much of what they have fought for at the World Trade Organisation.
Some are even guaranteeing Europe that she will never have less favourable access to their markets than her major competitors —China, Brazil and the US. This goes further than the trade liberalisation Africa saw under structural adjustment, which wiped out industries in the 1980s, policies that the World Bank later regretted. However, unlike in the 1980s, now even the free traders accept that rapid and poorly thought-through trade liberalisation brings inequality and destroys industries. So there really is no ‘development’ smokescreen to hide behind. But like in the 1980s, the conditionalities here also bite.
The agreements contain strong dispute settlement mechanisms through which Europe can make very sure that countries comply.
What is worse, none of this was necessary. It is not as if politicians in developing countries don’t know that these agreements are bad. They know, but for many, the only alternative they see is worse. Europe has put them between a rock and a hard place.
Countries are signing up to avert imminent disaster in their export sectors. The costs of the free trade agreements lie squarely in the future, while the costs of not signing are only a couple of weeks away. Plus, at the end of the day, when nearly half of your government budget comes from Europe and a $100m a year directly from the European Commission, it can be hard to say ‘no’.
This is the case for Mozambique, one of the poorest countries in the world. As the dust settles after Lisbon, one thing is abundantly clear. After decades of building an effective trade and aid partnership between Europe and Africa, there is no longer a genuine partnership in trade. Contrary to Europe’s claims, its threat to raise tariffs on January 1, 2008 is not a legal imperative. It is a choice. Pure and simple. Any development-minded minister from any EU member state must see that and must do something about it —now—before it is too late.
The Lisbon summit must be a wake-up call for the politicians who have been slumbering while European technocrats crowbar ever-harsher demands into intrinsically unfair deals. The threat to raise tariffs should be removed, and countries that have not signed EPAs must be reassured that they will not be left worse off after January 1.
Those who have initialled interim deals should be given the opportunity to review and if necessary, renegotiate, potentially damaging clauses. Any less than this will leave the EU with the uncomfortable legacy as the power that undermined Africa’s chances for future prosperity and denied the continent the opportunity to use trade to help lift people out of poverty.
The writer is Director of Campaigns and Policy at Oxfam on the latest developments in negotiations of free trade agreements between the EU and African, Caribbean and pacific countries