Follow-up on EU-African trade matters

December 14, 2007

Since I am not a specialist on these issues, I prefer others to speak:

– FT had an in-depth analysis on where the EU African relationship was going. A little extract below on the regional dimension of EPAs:

“Deals agreed so far between the European Union and former colonies are a long way from the neat pattern it envisaged of regional trading blocs liberalising among themselves and then opening up gradually to Europe. The blocs have splintered and the EU has instead scrambled to sign deals with small groups of countries – which will retain trade barriers against one another – and with individual governments.

The complexity reflects the fact that, as well as negotiating en bloc with the EU, the ACP countries in each region also have to decide how much they want to liberalise with each other. Because their economies are often similar, dropping trade barriers will create losers as well as winners, with the weakest companies going to the wall. Conflicting interests over trade with Europe have also created divisions between and within countries.

In west Africa, for example, Nigeria – one of the most recalcitrant negotiating partners – has little interest in making concessions to retain EU market access since most of its exports are oil and gas, for which there are no shortage of customers. Similarly other nations in the grouping, such as Benin and Mali, are “least-developed countries” that have little to lose as their more generous EU trade privileges will not expire on December 31. The few non-LDC nations in west Africa – Ghana is one – have had to scramble to sign bilateral pacts with the EU ahead of the year-end deadline.

In southern Africa, plans were thrown into confusion when the Southern African Customs Union, itself part of the wider regional grouping, divided. While some of its members – Botswana, Lesotho, Swaziland and Namibia – have signed, South Africa has not.

One African ambassador to the EU says the Commission has been following “divide and rule” tactics. “All along, the EU has been claiming that EPAs [economic partnership agreements] have to encourage regional integration but in the last two weeks it has been pulling apart, dividing regions,” he says. “It is regional disintegration.”

– ECIPE’s Senior Fellow Peter Draper was asked three basic questions after the EU-African summit last week-end: What prospects for EPAs? Will there be higher tariffs for African exporters from early next year? Are there any alternatives to the current EPA conundrum? Here his answers.

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