What are EPAs?
EPAs (Economic Partnership Agreements) are free-trade agreements that are negotiated between the European Union and 76 former countries in Africa, the Caribbean and the Pacific (ACP countries).
EPAs negotiations are part of the implementation of the Cotonou agreement – a much wider agreement that covers aid, trade and political cooperation between the two groups of countries. Cotonou replaces an older agreement, called the Lomé agreement. Under the Lomé and Cotonou agreement, the ACP have enjoyed special access to sell certain products in European markets. EPAs would replace this special access regime.
Negotiations for EPAs started on 27 September 2002 and were supposed to end before 31 December 2007. However only the Caribbean region concluded negotiations by then.
Why the concern?
- EPAs are free-trade agreements between very unequal partners. In return for the ACP access to European markets, the European Union is using the negotiations to demand that European companies have duty-free access to 80% of these countries’ markets. This may sound reasonable – but European companies and producers have all the advantages of size, technology and a developed economy (Agricultural producers also benefit from European subsidies). If the ACP open their markets to European goods, their own producers maynot be able to compete with the imports from Europe. It is likely that many will lose their livelihoods.
- The EU is using EPAs to force through its own agenda. The European Union is also using these negotiations to reopen discussions about issues that the ACP have already rejected at the World Trade Organisation, such as investment. The ACP say that having agreements on these new issues will restrict their choice of policies and will not bring any benefit to their economies.
- The negotiating process is disastrous. The EU has far greater resources available for negotiating EPAs. ACP countries do not have the time, expertise or money to follow the negotiations properly or analyse their potential impact. The EU claims that countries do not have to sign up to EPAs, but they have not considered any alternatives to ensure that countries that don’t sign up will not be worse off as a result. Furthermore negotiations are taking place between EU and ACP negotiators who are not necessarily speaking for their own governments.
The European Commission’s own assessment
The European Commission has also commissioned an impact assessment in West Africa by PricewaterhouseCoopers, published in 2003
It concluded that EPAs would:
• stifle efforts to develop a modern industrial base
• reduce exports of traditional crops
• lead to internal conflict and struggles over resources.
Why didn’t they stick with the old agreement?
The EU says that arrangements under the old Lomé agreement are not compatible with World Trade Organisation rules and therefore need to be renegotiated. This is technically true, but it highlights a problem with WTO rules rather than a problem with the old Lomé agreement.
Most WTO rules allow for poor countries to receive some special treatment in comparison with richer members. However, WTO rules on regional agreements do not have this option. Therefore EU and ACP governments should jointly go back to the WTO and renegotiate these rules.
