By Dr Clive Thomas
This series of Sunday columns assessing the CARIFORUM-EU, EPA started on January 20 and after fourteen weeks it remains incomplete without an appreciation of some key issues surrounding the several interim EPAs, which were initialled in Africa and the Pacific at about the same time. This and next week’s columns address the challenges and opportunities offered by this situation.
Firestorm of controversy
In the Caribbean a firestorm of controversy has greeted the CARIFORUM-EU, EPA. This continues to be fuelled as many of its shortcomings and criticisms from many quarters in the developing world and Europe come to the fore.
At this juncture a way forward that might reconcile these differences would be heavily dependent on political accords centering on the continuing negotiations over the interim EPAs and a framework arrangement under which all six regional EPAs when completed would be governed.
Several distinguished colleagues of mine, Professors Havelock Brewster, Norman Girvan and Vaughn Lewis have posited that there is still room (time) for Caricom reflection and the design of an approach that is not premised on the EPA as a ‘done deal.’ Experts in international law who have been writing commentaries on the on-going EPA negotiations point out that the initialled EPAs are by no means cast in stone. (See Lorand Bartels, Trade Negotiations Insights, April, 2008).
My reading of the situation is that while this is easily the best way forward, I do not believe the political leadership of Caricom has any appetite for the considerable intellectual, moral, and political challenges this will pose. Those committed to the existing EPA cannot envisage an alternative route to the development objectives of Caricom beyond the EU designed EPA box, which is fraught with regional pitfalls.
Those who are not so committed and are willing to think outside the EPA box may feel that the costs to their economies are ‘bearable’ and in any event will largely fall on future generations. Those who may be definitely opposed to the EPA approach may feel that they cannot take on both their colleagues and the EU.Interim EPAs: No Plan B
Following on the Cotonou Agreement the EU has been negotiating six regional EPAs with the ACP group of countries, all subject to the WTO-waiver deadline of 31.12.07. At a crucial stage of the negotiations the EU Trade Commissioner made it clear that failure to reach an EPA in any region by 31.12.07 would not spur the EU to engage an alternative strategy. As he stated: “There is no Plan B.” (Mandelson 2007) From all reports from then on until the end of the year “contention and conflict surrounded the process” as 2007 came to a close. It is felt by some that the signing of the only full EPA with CARIFORUM ‘saved face’ for the EU, given its rhetoric over the previous five years that in the context of the stalled Doha Development Round that it would be innovating through the EPAs new “partnerships of equals” among rich and poor countries, which should be emulated world wide.
The Interim EPAs were variously signed with regions, sub-regions and individual countries. They had to be, therefore, configured to specific sub-regional and individual country conditions.
The consequence was that in Africa and the Pacific, regional arrangements were put in disarray, even though an explicit goal of the EPAs was the opposite, which is to promote regional integration.
In particular, the divisions separated LDC status countries from non-LDC ones. If the deadline was breached, the former countries would have still benefited from EPA preferences (even though the rules-of-origin arrangements were not as good as those on offer in the EPA). The latter group would have been penalized however by the imposition of GSP duties. Twenty-two (22) non-LDCs therefore signed interim EPAs. In some regional arrangements the legality of these interim EPAs may yet be challenged, because signatories are members of integration groupings, which prohibit them from entering legal arrangements for trade on an individual basis.
As one analyst at the centre of these events ironically observed: “Separate deals with individual states or group of countries have effectively split ACP regions and have caused much tension between neighbours. Only the EU seems to have the audacity to claim otherwise.” (Sam Bilal, 2008. p.3)
As examples: The East African Community (EAC) signed to an interim EPA separate and apart from the Eastern and Southern Africa (ESA) group. In Central and West Africa, the Cameroon, Ghana and Ivory Coast concluded separate interim EPAs, thereby undermining existing regional integration efforts in these two areas. Concerned by these developments the African Union at its summit took the decision to play a more active political role in future EPA negotiations for Africa.
The haste and pressure exerted on the six regional ACP groups as the deadline approached was so intense that it has been claimed: “Some of the texts for Interim deals were tabled (my emphasis) by the European Commission just a few weeks (as was the case for ESA and EAC) and in some cases a few days (Cameroon, Ghana and Ivory Coast) before the deadline for conclusion.” (Sam Bilal, 2008, p.3)
The interim EPAs were also so individually targeted that on close observation of the details it can be seen that there was no clear developmental rationale determining trade liberalization schedules in the agreed texts. The Overseas Development Institute and the European Centre for Policy Development Management have recently completed a study (The New EPAs Comparative Analysis of the Content and the Challenges for 2008) in which it observed, “All of the African EPAs are different and only in one region does more than a single country have (sic) the same commitments as the others: the East African Community (EAC). At the other extreme is West Africa, where the only two countries with Interim EPAs have initialed significantly different texts with distinct liberalization commitments… The picture that emerges is entirely consistent with the hypothesis that countries have a deal that reflects their negotiating skills.”
These are some of the main challenges posed by the Interim EPAs.
Next week we explore the opportunities this situation presents.
