Montag 20. November 2017
#208 - October 2017

November EU-Africa Summit: A Zambian Perspective

Ahead of November’s EU-Africa Summit, a Zambian Jesuit economist surveys problems with existing EU-Africa trade relations.

Over the past two decades, summits between Heads of States and Governments of the EU and the Africa have taken place every three years, alternatively in Africa and Europe. These gatherings aim to assess the progress of commitments and provide political guidance for further work. On 29-30 November, the 5th EU-Africa Summit will take place in the Côte d'Ivoire city of Abidjan. The overarching theme chosen for the Abidjan summit is Investing in Youth.

 

As previously highlighted in a September Europinfos article by Henry Longbottom, the controversial Economic Partnership Agreements (“EPAs”) are back on the agenda and will certainly preoccupy much of the discussions in Abidjan. Towards the end of last year, several African, Caribbean and Pacific (“ACP”) states were faced with a loss of market access if they did not ratify their EPAs by 1 October 2016. To complicate matters, Brexit introduced an element of uncertainty and caused some ACP states to reconsider their decision to sign EPAs.

 

Incongruent vision

In order to speedily and meaningfully negotiate the EPAs, the EU and ACP states have to first develop a common vision and understanding in regard to the contents of the EPAs. The absence of a shared vision, in particular the EU’s insistence that ACP countries implement so-called “Singapore Issues” in relation to investment, government procurement, competition policy and other trade liberalisation measures, was acknowledged by the European Parliament as far back as 2012.

 

ACP countries reject the claim that adoption of Singapore Issues helps facilitate Foreign Direct Investment (“FDI”) and thus economic growth. On the contrary, they cite experience that economic and trade liberalisation in return for increased FDI inflow has not yielded intended results but has crushed infant industries within developing economies. Many commentators have observed that the Singapore Issues seek to enshrine greater rights for European corporations and further impede the ability of ACP governments to regulate them effectively.

 

Furthermore, ACP countries’ fears that the EU covertly sneak Singapore Issues into the EPAs are bolstered by claims by NGOs that the EU is hiding highly sensitive and potentially dangerous trade liberalisation under the pretence of development rhetoric. Indeed, the fact that EPAs are largely financed by the European Development Fund has fuelled suspicion that the deals are far from being based on an equal partnership. Given this situation, on the part of developing countries, the EPAs appear to become a paper bomb if concluded.

 

Difference in priorities

Difference in priorities is another block in EPA negotiation and implementation. The majority of ACP countries, particularly those in Eastern and Southern Africa, have largely agro-based economies, which are increasingly vulnerable to the effects of climate change. Concerns regarding food security are therefore taking precedence over a desire to conclude trade arrangements.

 

Likewise, internal political issues including governance, elections and the rule of law are a much more immediate priority for many ACP countries. For example, Kenya is currently preoccupied with elections, Zimbabwe has its own political and economic governance issues, the Zambian government is in constant battle with the opposition leaders. Meanwhile Madagascar is focusing on preserving political stability.

 

Such pressing concerns weaken ACP governments’ attention and political muscle with respect to trade arrangements, and further slows the pace of EPA negotiation.

 

Liberalise or protect

A crucial challenge that has been encountered in the negotiation process is the need for ACP countries to balance the need for development and the need to protect home industry in the face of market liberalisation. Countries in Eastern and Southern Africa for example are concerned that opening up local markets to international competition from EU products will negatively impact domestic production at a time when international export market opportunities are dwindling.

 

In addition, the removal of customs duties from EU imports will further exacerbate budgetary constraints experienced by ESA and many developing countries on account of depressed commodity prices in the last five years.

 

Furthermore, African markets are relatively small and EPAs expose them to larger risks than they ordinarily face. Their integration into the global financial system through trade liberalisation increases their vulnerability to international shocks. The fear that EPAs will unduly limit the policy space required by ACP countries and regions to pursue their own development strategies is arguably a very real one.

 

The challenge for the Abidjan Summit

For many ACP countries, EPAs potentially tighten a neo-colonial grip and cause regional disintegration among the ACP region. Unless policy space and time is given to ACP countries for them to resolve existing contentious issues and address internal political challenges, the aim of sustainable economic development and “investment in youth” will be an unachievable dream.

 

Charles B. Chilufya SJ

Copperbelt University, Zambia

 

The views expressed in europeinfos are those of the authors and do not necessarily represent the position of COMECE and the Jesuit European Social Centre.

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