A Harmful Economic Deal

Fri, Mar 29, 2013

By publisher

3 MIN READ

The new economic partnership agreement being pushed by the European Union on countries in West Africa is not in the interest of the region’s economy

|  By Maureen Chigbo  |  Apr. 8, 2013 @ 01:00 GMT

THE new economic partnership agreement, EPA, being ratcheted up for West Africa countries by the European Union, EU, could be harmful to their economy. The EU is asking the region to open up 80 percent of its markets under a new partnership agreement being negotiated by the two regions for a free trade area between them. Doing as EU has requested could lead to dumping of goods in the region which could hurt indigenous companies.

This is why Jorge Borges, Cape Verde’s minister of external relations, warned of the dire consequences for West Africa’s economy should the region concede to the European Union’s request at the one-day meeting of regional ministers of trade and finance held on March 21, in Praia, the Cape Verdean capital. Borges said that no country could develop without protecting its industries, warning that the region ran the risk of having its market taken over by European goods with the suggested opening of its market.

He said West Africa’s position is that the impending agreement should promote the region’s socio-economic development agenda. According to him, Borges acknowledged that while there had been milestones in the 10-year long negotiations, West Africa must remain focused to ensure that the new trade regime helps to actualise its development objectives, including progressively putting the region into the global economy, improving the competitiveness of the regional economy and reducing poverty.

But the EU is insisting that West Africa should open its market by 80 per cent over a 15-year period, while the region is offering 70 per cent over a 25-year period under the EPA negotiations between the two parties. For about one year, the negotiations had been stalled over the opening of West African market and the EPA Development Programme, EPADP, and the application of the most favoured nations among other things. In the intervening period, West Africa has sought to involve regional parliamentarians, who have also engaged their EU counterparts in the process while Côte d’Ivoire and Ghana have signed interim agreements with the EU to retain their export preferences in the EU.

West Africa, which includes the 15 ECOWAS member states and Mauritania, is insisting that the EU funds the EPADP, to enable it cope with the consequences of implementing the impending EPA with the injection of 6.5 billion Euro as fresh funds.

The EU has rejected this request, offering instead, facilities under the European Development Fund, EDF, and sundry resources for funding including bilateral contributions to West African States. The EPA is to replace the previous trade arrangements that guided trade relations between West Africa and the European Union.

At the meeting, Desire Kadre Ouédraogo, president of the ECOWAS Commission, said the adoption of a regional Common External Tariff, CET, by regional ministers of finance would augur well for the success of the meeting.

Unlike the previous trade regimes between the two regions, Ouédraogo said the ongoing negotiations have enabled West Africa to emphasise its development priorities, adding that the EPA should not be seen solely as a trade issue but as a development platform.