Tearfund (UK) | 2007
Much to lose, little to gain: Assessing EPAs from the perspective of Malawi
Economic Partnership Agreements (EPAs) between the European Union (EU) and African,
Caribbean and Pacific (ACP) countries pose a major threat to development and poverty
reduction. The ACP countries include some of the poorest countries in the world - 39 of the
world’s 50 Least Developed Countries (LDCs). Yet EPAs will require the ACP to liberalise
substantially all of their trade with the EU. The EU is also using EPAs to push its agenda
on the so-called ‘Singapore issues’ that developing countries have refused to negotiate at the
World Trade Organisation (WTO) for years.
The EPA negotiations are unbalanced. There is great disparity between the ACP and EU
in terms of development and economic power. Also, there are fundamental differences in
understanding between the ACP and EU of how the ACP-EU trade relationship can serve
development purposes. ACP governments, parliamentarians and civil society are expressing
increasing concern about EPAs, in terms of process, content and the potential impact on
ACP economies and populations.
This report looks at EPAs from the perspective of Malawi. Malawi’s stakes in EPAs are
high: as the single largest market for Malawi’s exports and a key source of imports, the EU
is an important trading partner. For the EU, however, trade with Malawi accounts for a
mere 0.01 per cent of its world trade.
This report shows that an EPA threatens to, inter alia:
– reinforce Malawi’s position as an exporter of low-value, unprocessed commodities,
undermining the Malawian government’s development strategy to ‘add value’ to
agricultural goods and to develop a manufacturing sector
– undermine regional integration between Malawi and its neighbours
– lead to a significant loss of fiscal revenue and induce other major adjustment costs.
Given the threat that EPAs pose to development and poverty reduction and considering
the concerns being raised by stakeholders across the ACP, we make a number of