Africa must be careful in its trade pacts with Europeans
The Nation, Nairobi
Africa Must Be Careful in Its Trade Pacts With Europeans
OPINION
By Ezra Kiambukuta, Nairobi
11 April 2007
The European Union celebrated its 50th birthday on March 25, since the signing of the founding Rome treaty, a pact originally comprising six Western European nations. France, West Germany, Italy, Belgium, the Netherlands and Luxembourg sealed an economic co-operation that was meant to avoid future wars.
The EU now prides itself as the world’s largest donor, having the largest single market with an estimated 500 million people.
Some 46 per cent Africans are dirt poor and life expectancy is at free fall at 46. Poverty now looks like the ’dear octopus’ sub-Saharan Africa will never escape.
In 2005 Nelson Mandela, while addressing 20,000 plus people in London’s Trafalgar Square spoke for us in calling on world leaders to make poverty history. Needless to say Live 8 concerts called for fairness on the cause of the world’s poor.
In a philanthropic gesture, G8 leaders seated at Gleneagles, Scotland, promised to double aid and world governments agreed to pardon debt for the Least Developed Countries and Heavily Indebted Countries.
WHEN THE EU DEVELOPMENT ministers and ACP trade ministers met last month to discuss progress on Economic Partnership Agreements (EPAs), Trade Commission chief Peter Mandelson and EU aid chief Louis Michel sought to dilute worries about the tornado effect on ACP weak economies that EPAs will herald.
At best they brandished empty chequebooks as compensation for EPAs knock-on effect by only alluding to 22 billion euros for the ACP between 2008-2013, including 2 billion euros a year in aid for trade to help the African and Caribbean group adapt to opening up their markets.
China’s breakneck economic growth that has banished poverty for 200 million has been attributed to trade. In only 25 years, its exports have grown three-fold.
Some 40 years ago, Asia was twice as poor as Africa is today. But thanks to trade, Asia is now an emerging economic force in geopolitics. While Asia swelled its share of the world market, Africa’s dropped from six per cent in 1982 to barely two per cent with each percentage point lost, equalling $77 billion yearly.
The U.S. awards its farmers $20 billion and the EU, 54 billion euros a year.
African countries must get together to dismantle the North’s conspiracy to fan the noblesse oblige that is our poverty.
For the North knows that minus their subsidies a pound of cotton takes only 12 pence to produce in Burkina Faso, while in U.S. it may take up to 42 pence. Why does the U.S. slap a 200 per cent tax on floriculture exports while EU attaches a 300 per cent tax on meat products from Africa? It is imperative we look at the import of the proposed EPAs being guerrilla-ridden by the EU. The EPAs could be our bane contrary to what the EU would like us believe.
Again EPAs will herald agreements with the EU, especially in trade and industry which it will be difficult to walk out of. The EU must not arm-twist us - without appearing to do so - straining ACP countries to swallow obligations beyond their WTO remit.
EPAS will not foster regional economic integration as they are a spanner into our dream of a "United States of Africa" and intra-regional trade for market widening and diversification, resource pooling and trade and investment amplification.
The North must play better polo and cede more ground by allowing us a threshold in Western markets. An increase in only one per cent threshold for Africa in world market, for instance, will earn us five times what trade and debt relief combined cannot.
AID AND DEBT AMNESTY ARE BUT A drop in the Mediterranean. We must be wary of opening our markets, ensuring this does not hurt our development priorities. We must choose prudently which services and industries to open up.
Fair trade is all we demand. Africa must look inward for economic salvation, too. Social dignity and economic freedom are the great international questions agitating our psyche. And this forms the crux of inalienable human rights.
Debate on EPAs should include the public, business, Parliament, and media. Mortgaging Africa’s future for a kettle of porridge will be a gross violation of 800 million Africans’ rights to practise life as global citizens.
Mr Kiambukuta writes on business and economics
