Europe-Africa : the New Free-Trade Threat

In an atmosphere of general indifference, the European Union is preparing to modify its strategy of cooperation with Africa, and more generally, with the more than 70 southern countries making up the c. New economic partnership agreements are already under negotiation, (due to be finalized by late 2007), which may deprive the southern countries of one of the rare mechanisms designed to help their development.

Neglected development aids

Until now, trade relations between the EU and the ACP were governed by the Lomé conventions, which were signed in the 1970s. These conventions reduced the amount of taxes paid by ACP countries before commercializing their products in the EU, with no strings attached.

By providing a favourable trade mechanism for these countries, Europe expressed a desire to help them develop local production. But, starting in the late 1990s, the EU has been trying to move away from this approach, since recognizing a “differential in levels of development” among ACP and European countries goes against the principles of the World Trade Organisation (WTO).

In the year 2000, the EU signed the Cotonou agreement with the ACP countries. Although in name, this treaty (which replaces the Lomé convention) was designed to fight poverty, in reality, it privileges trade norms at the expense of development imperatives.

To be specific, it states that Economic Partnership Agreements (EPAs) should be based on the principle of reciprocity. This means that if ACP countries were to continue benefitting from tax exemptions on the European market, they will be obliged to open 80% of their market to European exports, without setting any restrictions.

Vanessa Alby Flores, of the IRAM (Institute of Research and Application of Methods of development), stated “We must eliminate a rigid posture which tries to make tarif dismantling a condition for development”. She participated in a colloquium at the National Assembly on EPAs which was organized on Wednesday by non-profit group “Coordination Sud” along with Communist deputy Jean-Claude Lefort. Along with a majority of attendees, she agreed that the strategies implemented by the WTO over the past decade have led to a situation whereby the very premise upon which EPAs and trade agreements are based has been invalidated.

Far from encouraging development, free trade, via a reduction in taxes, has continued decimating the economies of poor countries. Chicken and milk production in Western Africa, are examples of the difficulties encountered by emerging and fragile local networks to compete with European products, which are rendered even more competitive through hefty subventions. This question is particularly crucial to the agricultural sector, upon which 70% of the African population depend for their survival.

Coordination Sud, an association of NGOs, suggests that Europe adopt, (at least during an initial period), measures which could protect interior markets, particularly in the agricultural sector. The organisation emphasizes that if, as the EU claims, a lowering of its customs fees should result in an increase in market share and therefore revenue for ACP countries, they must first be allowed to develop their production capacities.

This objective is unattainable without first protecting the inside markets. “They say that increased exchanges will benefit consumers”, according to Valérie Traoré, from Kenyan organisation Acord, “but in Africa, where most of the population makes a living from agriculture, the consumer is also the producer. If we want him to consume, then he needs to be ensured revenue.”

How to influence the course of EU-ACP negotiations, which incidentally are characterised by extreme inequalities of means and technical competences between the two blocks ? This is the question that Coordination Sud has submitted to French political parties within the context of the current electoral campaign.

Representatives from the PS and the UDF who attended the colloquium, did not question the current free-trade orientation of future EPAs. However, the PCF and the Greens are calling for a radical restructuring of the givens of the partnership between the EU and the South.

Fabienne Poure (PCF) is asking for « a Marshall plan for Africa », and Patrick Farbiaz, has suggested on behalf of the Greens that the WTO give precedence to social and environmental concerns before trade principles.

In the meantime, Jean-Claude Lefort (PCF), reminded the assembly of the need for “creating a balance of power that could transform the EPA into a positive force.” In order to do that he asked that the year-end 2007 signature deadline be extended. That could give companies in the South as well as the North, time to get more involved in the debate and put pressure on the different negotiators.