TODAY, we embark on a series of articles on the Economic Partnership Agreements (EPAs), an initiative between the European Union (EU) on one hand and the African Caribbean and Pacific (ACP) countries on the other.
Hopefully, by the time of the last article on the matter, the EPAs will have been demystified and various questions surrounding the issue answered.
Yes, the issue has a lot of facets ranging from its meaning to who the intended ultimate winner is.
According to the EU, the EPAs are trade and development agreements negotiated between the EU and ACP regions engaged in a regional economic integration process.
Obviously, just that definition raises a myriad other questions, among them who the members of ACP, is Zambia one of them, has EU reached these agreements with all the targeted regions, who came up with this arrangement and when?
Other questions are; since the EPAs involve trade and development agreements where does that leave the need for free trade, or liberalised market systems, are the EU and ACP regions on the same footing and can all members of the two sides negotiate fairly.
A further look at what is stated by both groupings in their official documents or speeches is in order because that will be reconciled with what actually obtains on the ground.
This is to ascertain whether using the EPAs we can have, if I may use the overused clichés, a win-win situation between Europe and the ACP regions can prevail.
Subjectively, the all important question which should be answered is, will Zambia benefit from the EPAs and up to what extent.
Then there is the aspect of operation, are the EPAs already operational between EU and all the targeted regions? If not why and in how many regions, if any, are they been made operational?
According to the official Economic Commission website on trade, all EPAs have their origins in the trade chapter of the Cotonou Agreement – a broad agreement between the EU and ACP group of countries. They date back to 2000.
On paper, EPAs are aimed at promoting sustainable development and growth, poverty reduction, better governance and the gradual integration of ACP countries into the world economy.
Form the EU point of view the EPAs are aimed at promoting trade between the two groupings – and through trade development, sustainable growth and poverty reduction.
The EPAs set out to help ACP countries integrate into the world economy and share in the opportunities of the global economy.
There is an argument that for well over 30 years, exports from the ACP countries were given generous access to the European market.
Sadly, preferential access failed to boost local economies and stimulate growth leading to the drop in the proportion of EU imports from ACP countries from seven per cent to three per cent of the total EU imports.
The ACP EPA countries group themselves into seven regions: five in Africa, one in the Caribbean and one in the Pacific.
The regions are West Africa, Central Africa, Eastern and Southern Africa , Eastern African Community, the Southern African Development Community, the Caribbean and Pacific.
This helps the agreement to take full account of the particularities of individual countries.
To talk statistics, briefly, the ACP accounts for 39 of the world’s 49 least-developed countries (LDCs), most of them in Africa.
Together the EU and ACP boast of 1.35 billion people, 20.1 per cent of the world’s total landmass and EURO 80 billion in trade in 2007, with the EU having imported EURO 40.2 billion from the ACPs and exported EURO 39.7 billion.
According to EU the EPAs aim to remedy the current situation by promoting a new approach which has no quotas and no duties on exports to the EU – free access to the EU market for all ACP products.
The EPAs encourage building regional markets – boosting trade between ACP neighbours and regions, with significant potential benefits for ACP exporters without undue competition – ACP countries will only gradually open their markets to EU imports.
The producers of the most sensitive 20 per cent of goods will enjoy permanent protection from competition.
Further, there are no shocks as EPAs will be implemented in a way that avoids unnecessary shocks and duties will be phased out over a period of 15 to 25 years.
Additionally, there is coverage of services and foreign investment – EPAs deal with trade in goods and trade in services as well as investment.
On paper, EPAs are part of the wider development agenda for ACP countries and, therefore, there will be wider reforms to strengthen the laws and regulations.
This will create a rules-based trading system, attract local and foreign investment and create the conditions for greater prosperity.
Next week we will, God willing, look at these issues from the ACP countries’ point of view.
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