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Extend deadline on partnership pact

Daily Graphic, Ghana

Extend Deadline On Partnership Pact

14 March 2007

Civil society groups and other stakeholders in West Africa’s development process have unanimously called on the European Union to extend the deadline for reaching a deal on Economic Partnership Agreements (EPAs).

They contend that this is necessary to give their African, Caribbean and Pacific (ACP) partners enough time to think through controversial and uncertain aspects of the agreements.

According to them, the EPAs, as being proposed by the European Commission (EC) at the moment, are not fair to the ACP countries as they have the potential to cause the collapse of their economies and take jobs from their citizens.

The Head of Programmes of the Third World Network (TWN) in Accra, Mr Tetteh Hormeku, and the Nigerian Director General of Customs, Mr Jacob Gyeke Buba, said that Africa particularly needed time to develop its own intra-regional trade and form more sophisticated linkages among themselves before they could sit with their EU counterparts at the negotiating table.

“We think as it is now, we need to link Africa together properly in trade and harmonise customs rules and regulations before we can sit with the EU as a larger bloc. We are running faster than we can,” they agreed.

Speaking on the topic “Are Economic Partnership Agreements Pro-development? The Policy Coherence for Development of EU-ACP Free Trade Agreements,” Mr Hormeku said the inclusion in the negotiations of what had become known as the Singapore Issues - investment, competition and procurement - represented issues that would lead Africa into deprivation.

He said those issues would incapacitate African governments in their use of procurement and investment to build local capacity to guide each country’s own development.

According to Mr Hormeku, the EU proposals as they stand on those issues will lead to the removal of tariffs on services and open Africa again to unimpeded investment from Europe, adding that having been forced to liberalise its industries in the 1980s, West Africa has already lost thousands of its industries and competitive advantage to the Western world.

He debunked the EU’s promise of helping to solve supply-side constraints, saying “it is not enough to build supply-side constraints by building infrastructure - roads, energy, etc - because EU goods, with all their competitive advantage, which makes them cheap, are already in the country and will rely on this same infrastructure to their advantage.”

He added: “Development is not simply about adjustment cost but how we build productive capacity across the entire economy so that farmers can grow more and get more income.”

Mr Hormeku said the EU and its ACP counterparts should for now preoccupy themselves with how to make Africans maintain grips on their enterprises and factories and how to use services, such as financial services and telecommunication to support, grow and sustain agriculture and industries in Africa.

He buttressed his point with a study by the United Nations Conference on Trade and Development (UNCTAD), which recommended that the best way to help developing countries was to build their capital and human resources in entrepreneurial skills in an integrated way so that they would not remain exporters of primary products.

Mr Hormeku said time was not of essence in signing the EPAs.

He noted that the EU’s insistence on what he described as an artificial and contrived December 31, 2007 deadline was only a demonstration of how the EU was using its might and financial power to cow the smaller and developing nations into signing an agreement that would in the end be disastrous and injurious to their respective economies.

Mr Buba, for his part, said the EU had taken time to become a bloc and Africa also deserved the benefit of time to evolve and build its own economy so as to have two blocs facing each other at the table rather than the current situation of the mighty negotiating with the poor.

Mr Buba said intra-African trade was already very low and there was the need to resolve all the related problems before a larger bloc-to-bloc agreement would be attempted.

He said African countries depended heavily on customs duties to finance their development and that was why under the ECOWAS Trade Liberalisation Scheme, there was the arrangement to offset lost revenue with the 0.5 per cent ECOWAS levy on non-ECOWAS products.

Mr Buba argued that under the EPAs, tariffs would be cut and Africa would not find any source of revenue to fund its development.

A civil society activist and an European journalist, Mr Klaus Schilder, attacked the development assistance pledges of the EU to ACP countries under the five-year European Development Fund (EDF), which, he said, took a longer time to disburse.

Indeed, Oxfam has done a study that establishes that since the EDFs started in 1975, the highest level of disbursement has been 43 per cent.

Mr Schilder said the EDF disbursements were surely going to be slow under the 10th arrangement, though there was a marked improvement in terms of figures (€22.7 billion for the next five years), because the EU membership, each of whom must ratify the pledge, had now increased from 15 to 27 countries.

He called on the EU to soften its hard and fast stance on the deadline and extend it by a reasonable number of years to allow the EU to study and consider some of the proposals submitted to the table by ACP countries.

The German Minister of Economic Development and Co-operation, Ms Heidermarie Wieczorek-Zeul, took a completely different position and said the EPAs would develop the economies of the ACP countries and must be taken seriously.

“The EPAs will improve ACP countries access to EU markets and it is not the intention of any EU company to flood African markets with their products,” she stated.

She argued that even without EPA’s between ACP countries and China, China was already devasting their economies without a reciprocal effect, but even the EPAs offered asymmetrical tariff cuts between the two parties.