How can the differences between the EU and a significant number of ACP countries be smoothed out with regard to the new Economic Partnership Agreements (EPAs) aimed at governing how they work together? Several African countries reject an essential element in the EPA: trade reciprocity between countries whose development levels are incomparable. This rejection has, at different times, taken more extreme forms, including street demonstrations in Africa and Brussels. The differences underpin the defence of often valid economic and political interests, as well as a significant lack of knowledge or misunderstanding about the respective positions (see previous column). The Caribbean, as we are aware, initialled a complete EPA with the EU, which, in compliance with WTO rules, made it possible to maintain the previous trade regime with the region, together with a few modifications. Reciprocity will be slow and gradual, with permanent derogations. In the “Pacific region, Papua New Guinea and Fiji concluded provisional agreements, which will be completed later. The trading strength of other countries in this region is limited. The EU will, in principle, now apply a normal regime of “generalised preferences” to them.
Situation. Africa is at the centre of the concerns and difficulties. Many countries (Kenya, Tanzania, Burundi, Rwanda, Namibia, Mozambique, Cameroon, Ivory Coast, Ghana, etc) have initialled temporary agreements and will continue negotiations for reaching definitive agreements. In the meantime, they will keep the preferential regime without reciprocity. Among those who have signed nothing, are countries belonging to the group of less advanced countries who benefit from the “Everything but Arms” regime (Mali, Mauritania, Senegal, Togo, Liberia, Congo Brazzaville, etc), while the less favourable regime of generalised preferences is applied to Nigeria, Congo Brazzaville and Gabon. After a transition period, it will also be applied to Cap Verde. Trade with South Africa is governed by the bilateral agreement in force (EUROPE 9575 for details).
Measures of appeasement. Different initiatives have been taken or confirmed by the Europeans to take the African countries' difficulties and misgivings into account. Especially:
interim agreements that enable the EU to apply the preferential trade regime to certain countries, but which do not cover trade in manufactured goods. This sector is strictly under WTO rules. Other aspects (services, investment, public procurement etc) will be negotiated later but without forgetting that the Cotonou Agreement between the ACP and EU does not include any obligations in these areas;
the schedule for opening up the African markets could be extended until 2023, indeed 2033 in some cases, and African countries can exclude sensitive products from the opening up (those who have already negotiated or introduced derogations for new industries and agricultural products);
the EU will finance trade assistance programmes to improve African countries' export capacity, as well as the special programmes for bananas, sugar and rice.
Two negative repercussions. The positive measures mentioned do not, however, remove current negative developments involving, in particular:
Repercussions on the regional integration dynamic of African countries. The way in which the regional bodies and developing projects work has been disturbed. Certain groups have split up, some member states have negotiated and initialled interim agreements with the EU, and others have refused.
The budgetary impact of the liberalisation of trade in many African countries where customs revenue accounts for most of the national budget.
Despite the official silence, diplomatic activity for overcoming the divergences has been intense but the climate remains tense. The African Union summit will be meeting next Friday (until 2 February) and it is expected to rebuild a certain continental unity following the decomposition that has occurred. The offer made by Commission President José Manuel Barroso to make a personal visit to Africa was warmly welcomed, although it is still not clear if the meeting would cover all ACP countries, just African countries or separate visits to the different regional groupings.
Other factors also need to be looked at, such as the disadvantages of funding a country through customs revenue, what production of food crops in Africa entails, the relationship between this dossier and the Doha Round, and China's scramble for Africa. These subjects will be discussed soon.
(F.R.)