Movement Through the Caribbean-EU EPA Negotiations?

At the launch of the Caribbean-EU EPA negotiations in April 2004 a number of points were agreed which appear to offer scope for a substantial evolution of the European Commission approach. The joint plan and schedule for EPA negotiations placed considerable emphasis on supporting “national strategies, policies of adjustment and structural transformation”. This demand for a trade agreement which promotes the structural transformation of ACP economies, so that more value is added to products locally and economic diversification is encouraged, is at the heart of the ACP vision of what EPAs should be about. 

What is more the document maintains that WTO compatibility “should encompass a variety of forms of special and differential treatment, which are not limited to longer transitional periods and technical assistance”. It recognises that in a Caribbean context this may need to go beyond existing WTO provisions to “effectively address the constraints of small size and vulnerability, especially as it relates to market size and scale of economic activity”. This effectively amounts to a call for a clarification of WTO rules on what a free trade area between a developed giant like the EU and small and vulnerable developing economies should look like. If these provisions can be effectively operationalised then this could constitute a significant development in the European Commission’s approach to EPA negotiations.

However, given the heavy dependence of Caribbean export to the EU on  rum, bananas, rice and sugar (25% of total exports) all of which have been or are being affected by EU policy changes, which are eroding the value of traditional trade preferences, it is difficult to see how a future EPA can “improve on the Lome and Cotonou acquis in respect of market access for both traditional and non-traditional Caribbean exports”, as the joint document calls for. 

The debate around EPAs can be very confusing.  Often EU and ACP spokespersons use the same words, phrases and concepts, yet mean very different things.  For example when  Development Commissioner Nielson states that “EPAs are first and foremost about development” he does not actually mean the same as when ACP spokespersons and non state actors talk about the need for EPAs to be about development.  For the European Commission EPAs, by the very nature of their trade liberalising agenda  are about development.  By imposing external disciplines on ACP government  (so called “policy lock-in”), EPAs will ensure policy consistency and transparency, in ways which open up economic space for private sector development.  It is this aspect of policy change in ACP countries which is central to the European Commission’s conception of the development dimension of EPAs. For ACP spokespersons and non state actors the development dimension of EPAs is more about getting to grips with the supply side constraints which inhibit competitive forms of production, be they human resource constraints or physical infrastructure constraints.  It is about structuring trade agreements and associated “flanking measures” in such a way that they directly benefit the poor and marginalised.  It is about ensuring the negative transitional costs  of change are minimised and ensuring all necessary measures are taken to enable ACP countries to secure new benefits from future trade relations with the EU.

Equally, when Commissioner Nielson speaks of regional integration being “ core priorities in the EU’s development policy”, in practical terms this has  a very different meaning to what ACP governments mean when they speak of prioritising regional integration. For the European commission regional integration processes are equated with progress in regional market integration and the dismantling of formal tariff and non tariff barriers to trade.  Regional integration in Africa is seen as being strengthened if it is underpinned by an international agreement with the EU, which penalises any back sliding on commitments made on market opening.  For the ACP, regional integration is seen as afar more complex political and economic process, with the pooling of sovereignty in economic policy areas being intimately linked with political confidence building. In this context the launching of EPA negotiations in eastern and southern Africa in a framework which has split two existing regional integration initiatives – the Southern African development Community and the east African Community - is not seen as supporting complex processes of regional integration.  Indeed, the European Commission’s conceptual construct of “open regionalism”, whereby regional integration is seen as proceeding in tandem with preferential market opening to the EU, is seen as fundamentally flawed.

In order to assist concerned stakeholders to find there way through the very different meanings placed on basic concepts and phrases the European Research Office and 11.11.11 are developing an “A.B.C. Guide to the Key Terms and Concepts in ACP-EU Economic Partnership Agreement Negotiations”, which will be posted on the EPAWATCH website.

• based on a principle of non-reciprocity, as instituted in GSPs and special and differential treatment in the WTO
• protects ACP producers domestic and regional markets.
• reverses the pressure for trade and investment liberalisation
• allows the necessary policy space and supports ACP countries to pursue their own development strategies.

Background to the statement

During April this year, a representation of European, African, Caribbean and Pacific economic justice organisations met in Brussels because of a shared concern about the direction of the "economic partnership agreements' being negotiated between the European Union and the African Caribbean and Pacific Group.

With EPA/FTA negotiations in the second year, it was agreed that the 'economic partnership free trade' negotiations are driven predominantly by European corporate interests and those of a few privileged business elites in ACP countries.

The benefits for most ACP citizens are at best uncertain, and at worst, extremely detrimental. Europe has everything to gain and nothing to lose; the large majority of small producers in ACP countries have everything to lose and little to gain. And yet it is being claimed that the EPAs are instruments for development. Worst of all, the negotiations are taking place far away from public scrutiny and debate, whether in Europe or in the ACP countries themselves.

The short statement reflects the common perspectives on the free trade area negotiations between the EU and the ACP Group. It is the starting point for mobilising public debate and opinion on these negotiations. It is important to denounce the use of development rhetoric to the agendas of European corporations. Visit the website to see the broad coalition against EPA's in their curren format.

Private Sector Concerns Over ESA Preparations for Negotiations

While the ESA Regional Negotiating Forum held its first meeting in Mombassa in mid April there are considerable differences in the state of preparation undertaken by the National Development and Trade Policy Forums of ESA member states. 

These differences are also reflected in the state of implementation and quality of some of the national EPA studies, many of which provide little of direct use within the process of EPA negotiations.  Overall there has been little  progress to date in preparing for the launch of substantive negotiations. 

Private sector business representatives are believed to be particularly concerned at the lack of time available within the current  negotiations schedule to undertake analysis of the substantive issues which will need to be addressed at the sectoral level.