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TRADE-ZIMBABWE: EPAs ‘‘Bringing in Old Issues Through Back Door’’

Tonderai Kwidini

HARARE, Dec 11 2007 (IPS) - With an economy tottering on the brink of collapse and an unenviable political situation, civil society organisations in Zimbabwe have every reason to worry about the implications of the interim agreement on trade in goods that their country has just signed as part of the economic partnership agreement (EPA) with the European Union (EU).

Many argue that the Zimbabwean government should not agree to the EPA. While an agreement on trade in goods has been reached with the Eastern and Southern African (ESA) group of countries, the negotiations on the rest of the EPA will be continued next year. Zimbabwe forms part of the ESA group.

‘‘The negotiations have not been exhaustive on some of the agreed issues. To make matters worse, African countries are not negotiating as a bloc because Europe has managed to fragment them,’’ says Andrew Mushita, director of the Community Technology Development Trust (CTDT), a non-governmental organisation with interests in trade and technology issues.

‘‘They will only come out of these EPAs worse off.’’

Mushita says that Zimbabwe ‘‘cannot compete with the EU on an equal footing because of our economic situation’’.

He is also worried about the rearrangement of regional configurations as that weakened the position of African countries further.

Other organisations have also added their voices, saying that the EU will emerge as the biggest winner. It will be folly for countries like Zimbabwe with an economy in tatters to hope for any ‘‘heavenly manna’’ to arrive via the EPAs.

‘‘Zimbabwe is just like any other country in the Southern African Development Community or in East and Southern Africa grouping. It is not ready to sign an EPA. Opening up our markets in the present state will only lead to the further exploitation of our raw materials,’’ Joy Mabenge, executive director of the Zimbabwe Coalition on Debt and Development, told IPS.

EPAs are a scheme to create a free trade area (FTA) between the EU and African, Caribbean and Pacific countries. They are a response to continuing criticism that the non-reciprocal and discriminating preferential trade agreements offered by the EU to its former colonies under the Cotonou Agreement are incompatible with World Trade Organisation (WTO) rules.

The EPAs have faced opposition from civil society organisations and some governments in Africa who see them as a way of liberalising the service and investment sectors of ACP countries.

‘‘African economies will not be strengthened by signing the EPAs. It’s a shock that many African countries are rushing into signing the EPAs when they don’t really understand what they mean. It’s bringing in old issues through the back door," Mabenge told IPS.

Mabenge says Zimbabwe needs more time to resolve its economic problems before it can make commitments like the EPAs. The EU is only interested in African raw materials, which it will return to Africa in the form of processed products at exorbitant prices. Africa still has to strengthen its economies and industrial bases.

‘‘Let’s get our economies to function. Then we will be able to compete on an equal footing with Europe. This issue is being looked at from a simplistic point of view,’’ Mabenge argues.

Several Zimbabwean analysts say the current economic problems will further hinder Zimbabweans from benefiting from the EPA. Several Zimbabwean companies face demise due to government’s populist policies, which have led to shortages in foreign currency to procure essential industrial components. Zimbabwe’s inflation rate is 7,800 percent.

These problems, analysts say, make it impossible for Zimbabwean companies to compete in the EU market. A sector such as agriculture, which has witnessed a rapid dip in fortunes since 2000 after the introduction of the government’s ‘‘land reform’’ programme, will be forced to compete with subsidised produce from Europe.

Similarly, the beleaguered manufacturing sector will have to take on an influx of European commodities.

The Zimbabwean parliament was recently told at a caucus meeting that the EPAs will take away some of the country’s guaranteed markets.

One organisation has adopted a different position on the EPAs. The Trade and Development Studies Centre based in the Zimbabwean capital Harare does policy research and analysis, focusing particularly on the relationship between trade and development, aid and development, poverty alleviation and welfare.

‘‘These EPAs are not coming from nowhere. They are the result of a gradual build-up through several conventions. There is nothing wrong with the EPA. The problem is its implementation. It can be developmental or have the opposite effect,’’ Masiiwa Rusare, the director of the Trade and Development Studies Centre, told IPS.

‘‘We should keep an eye on what happens. What is needed is to encourage the government to diversify its trade partners and create more options.’’ But Rusare concedes that, regarding market accessibility and agriculture, ensuring that the EPA deal works fairly will be a Herculean task.

‘‘It’s like taking a non-boxer into the ring with (boxing champion) Mike Tyson. The results are obvious,’’ Masiiwa says.