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EPAs - another bad deal for Africa

Mmegi/The Reporter, Gaborone


EPAs - Another Bad Deal for Africa

6 March 2006

By Bugalo A. Chilume

First, a recap: the West has over the years used structural adjustment reforms to keep Africa economically weak and increase the continent’s dependence on external loans.

These reforms require poor, desperate African countries to liberalise their markets, among other things, in order for them to qualify for economic ’assistance’ from the West. However, these economic reforms have been disastrous to virtually all countries that implemented them - the result was economic stagnation, increased poverty levels and external debt.

Most importantly, the reforms prematurely pushed weak African economies into global markets where they are unable to compete with multi-national corporations.

Even the proponents of these economic reforms have admitted, albeit grudgingly, that they are bad for developing economies.Yet, a key feature of the EU’s proposed Economic Partnership Agreements (EPAs) with African countries is the discredited structural adjustment reforms.

The reforms are nothing new; they have always been central to the economic partnership between Europe and its former colonies through the Lome Conventions, which, starting in 1975 conferred prefere ntial trade status to former colonies to ensure security in the supply of cheap raw materials for European industries. The new ’partnership’ would replace trade preferences for African countries with reciprocal rights for Europe’s goods into African markets, and require these countries to implement structural adjustment reforms.

Rangarirai Machemedze of SEATINI points out that these reforms are "the same conditions that have been imposed on developing countries and precipitated their demise from the path of development to the path of perpetual dependants on aid. "

In a study prepared for the World Council of Churches, Professor Jane Kelsey indicated that "the primary objective of the new to enable European powers to shed their historic responsibilities to their former colonies and refocus their energies and resources on the new priorities of European expansion and competition with the US to dominate the world economy...the claim that granting reciprocal free trade access into (African) markets for European goods will promote sustainable development and poverty alleviation is outrageous. Reciprocal trade in goods will threaten the survival of small local business and wage-earning jobs, with no guarantee that any replacements will emerge".

Undoubtedly, on account of serious supply-side constraints such as lack of resources and production capacity, very few African firms, if any, will penetrate the EU market.

For his part, Richard Kamidza of the Alternative Information and Development Centre (AIDC) says that "the EU is in a hurry - in a state of emergency. "Their capital owners are currently suffering a profitability crisis in their markets. They are in need of expansion to developing countries. So while the EU under the Lome Conventions needed cheap commodities for their industries, they are now in need of unrestricted markets. That is why the EU now argues for reciprocal trade... EPAs are pushing for levels and speeds of market o pening that will seriously hurt the fragile economies of (African) countries."

The EPAs are supposed to be achieved through negotiations but in reality very little negotiations will take place; African countries will be subjected to the dictates of the more powerful EU. According to Kamidza, "Although the EPAs negotiations are presented as a win-win situation, it must be understood that they are between unequal partners. "

The process leading to the negotiations, the host of unresolved issues being swept under the carpet, and the manner in which the EU is fast - tracking them, can only go in one direction - and that is to the benefit of the EU, and at the cost of the poor (African) countries that are compelled to bear the cost of adjustment."

Indeed, the role of the EU as a major aid donor to most of the countries involved in the negotiations will influence the outcome of the process.

Regarding the participation of citizens in this process, Professor Kelsey had this to say, "The Contonou Agreement talks about empowering civil society, when it is really empowering capital and creating new national elites. "The participation of ’civil society’ and non-State actors in the process and the desire to promote ’ownership’ at the national level are never allowed to dispute the European Union’s neo-liberal development paradigm.

Despite an unprecedented level of consultation and disclosure with ’non-State actors’ since 2001, very few educated people are aware of what is at stake, let alone the ordinary people whose lives could be turned upside down. This reflects the complexity of the issues and the lack of understanding and capacity among governments as well as their peoples."