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TRADE: ‘‘EPAs Will Prevent African States From Achieving MDGs’’

Stanley Kwenda

JOHANNESBURG, Apr 11 2009 (IPS) - The economic partnerships agreements (EPAs) will push African, Caribbean and Pacific (ACP) countries ''deeper'' into poverty and negatively affect the livelihoods of people living in ACP countries. These trade deals ''will prevent'' African countries from achieving the United Nations’ millennium development goals (MDGs).

Several speakers at a two-day workshop on EPAs in Johannesburg, South Africa, were in agreement that the EPAs will do more harm than good to ACP countries. The workshop happened on Mar 6-7 and was arranged by the Economic Justice Network (EJN), the economic and social arm of the Fellowship of Christian Councils in Southern Africa (FOCCISA).

Thomas Deve, a policy analyst with the United Nations Development Programme (UNDP), told IPS that the EPAs largely have an anti-development agenda. ‘‘All MDG targets are negatively affected by macro-economic fundamentals that promote indiscriminate and externally induced liberalisation and privatisation, a key feature of the EPAs that the European Union (EU) is imposing on the ACP,’’ Deve told IPS.

‘‘EPAs are being imposed by Europe on its former colonial territories in the ACP. The agreements will join these regions’ economies in a free trade area with Europe and give European big business a monopoly, which is in itself anti-development.’’

Deve believes agriculture and industry will be destroyed. He argued that EPAs will give Europe power over economic policies to govern the ACP region and turn its governments into mere local managers of European corporate interests and profits.

‘‘It will kill off any ambitions for regional integration within and across Africa and South-South relations with other developing regions,’’ Deve added. ‘‘Already, they have split all of Africa’s regions. In West Africa, for example, Ghana and Cote d’Ivoire have broken ranks and endangered regional unity by going ahead to agree to interim EPAs with Europe.

‘‘We must fight to reverse this, and prevent our further journey on this one-way street to disaster.’’

Deve said the liberalisation of the fishing sector will lead to loss of livelihoods for fisher folk while the liberalisation of trade in goods has implications for small traders in the informal sector. The decline in government revenue due to the loss of custom duties will affect social sector spending on essential services such as water provision, health and education.

He added that there will also be a massive outflow of financial resources, which will lead to the further deterioration of much needed local investment in ACP countries.

Percy Makombe, programme manager at the Cape Town-based EJN, told IPS that, ‘‘we are saying no to EPAs. We have experience of the structural adjustment programmes instituted since the 1980s and we know the havoc that they caused in our countries.

‘‘They caused an upsurge in the dumping of European products, leading to the closure of many industries and resulting in job losses and crime and other anti-social vices.’’

Makombe argued that if the full EPAs were to be signed under the existing parameters, it would lead to the further loss of social protections in ACP countries. He cited the interim EPAs clause dealing with the services sector which the EU wants opened up to trade.

‘‘The service industry should never be opened. We know the effects of using user services for profit making. If that happens, governments will obviously seek to abrogate their responsibility to provide services to the public, leaving us at the mercy of the private sector. Health care will only be for those with money,’’ Makombe told IPS.

‘‘There is a need to develop our local markets first. It is only when they are strong that we can have strong progress and open up markets,’’ he stated.

There are several examples in the Southern African Development Community (SADC) region pointing to the dangers of opening up local markets without considering the implications of liberalisation. In Zimbabwe a big textile company Contextile closed shop in the 1990s and left thousands of workers jobless.

In 2007, Malaysian textile company Ramatex abruptly closed in Namibia after it was not satisfied with its profit margins. It left in its wake 6,000 jobless workers and untold environmental damage.

Rangarirai Machemedze, deputy executive director of the Harare-based Southern and Eastern African Trade Information Negotiations Institute (SEATINI), told the workshop that the EPAs have a questionable developmental dimension.

He decried the use of gunboat tactics by the EU in trying to coerce African countries into signing EPAs. ‘‘They link trade and development and promise African countries development aid based on progress with the EPAs,’’ Machemedze told the workshop participants.

He gave the example of Zimbabwean EPAs negotiator Tedious Chifamba who was reminded during EPAs negotiations that if his country wanted funds to complete the building of a dam he had to ensure that an interim EPA was signed.

Malawian president Bingu Wa Mutharika, whose country has not signed an interim EPA, once asked that, ‘‘if EPAs are good, why are we being forced to sign?’’

Malawi says it needs to develop its industrial capacity before signing. According to an EPAs case study done by independent researcher Francis Ng’ambi, it will need eight billion dollars to reach a desirable capacity.

Makombe regards EPAs as ‘‘WTO plus" in nature because they are trying to bring back the issues that the European Union was pushing but which were rejected at the World Trade Organisation’s (WTO) Singapore meeting.

‘‘They are simply trying to bring through the back door issues that have been rejected at the WTO’s Doha round,’’ Makombe told IPS.

‘‘The Doha Round is about trade with development and nothing else but the EU is seeking to go around this with the EPAs. The fact that the negotiations are being done between the EU and individual countries is an abrogation of regional trade and a real threat to regional integration.’’

With talks stalled at the WTO, it means more pressure is placed on bilateral negotiations like EPAs.

Liepollo Lebohang Pheko, policy and advocate director at the Johannesburg-based The Trade Collective – Four Rivers, also attended the conference and gave a gendered analysis of the EPAs. The EPAs ‘‘will be a devastating assault on women‘s health. They are not going to help us develop in any way. They are evil, bad and must be stopped,’’ Pheko told IPS.