The European Union is concerned about competing with China for access to resources and markets in Africa, which partly explains its drive to hook African states into the trade deals called economic partnership agreements (EPAs).
According to Rob Davies, South Africa’s Deputy Minister of Trade and Industry, the EU is afraid that it will lose its foothold on the African continent and wants to prevent this at all cost.
“Over the past years, the trade between South Africa and Asia has grown tremendously while the trade with Europe has decreased,” Davies said at a special review meeting of the Africa Trade Network held in Cape Town, South Africa, last week (February 20 to 22). The network has civil society organisations from across the continent as members.
Instead of focusing on the EU as their most important trade partner, African nations should aim to nurture and extend their trade relationships with emerging economic powers such as China and India, said Davies.
“China and India, due to their industrialisation, offer developing countries higher prices for natural resources. They do not force us into lowering our tariffs, contrary to Europe,” he said.
“We have got to keep working on those relationships, as they are very important to our economies. India and China offer developing countries better deals than the options provided by the old colonial masters. It is not utopia, but some serious opportunities exist in China and India. We should take them in consideration.”
According to the EU, the EPAs are development tools designed to assist in the integration of the African, Caribbean and Pacific countries into the world economy while promoting their sustainable development and contributing to poverty eradication.
“There is a huge gap between what Europe says its intentions are and the true picture,” Davies told the meeting, which drew various delegates from African and international civil society organisations as well as several African trade officials.
“Brussels claims that the EPAs will promote integration and development in the region and that it has no mercantilist intentions with the EPAs. This is not the case. Firstly, the ACP region has been divided into six different configurations. This does not contribute to unity.
“In addition, within each group, some countries have initialled interim EPAs while others have refused. This does not contribute to unity within the region either,” Davies pointed out.
One of the major objections regarding the agreements is the way the EU has forced ACP states to sign by threatening that raised tariffs would kick in at the end of last year. Namibia is one example of this.
“Namibia signed under protest. The country was put under a tremendous amount of pressure by Brussels,” explained Davies. “If Windhoek refused the EU offer, its beef sector — which plays a crucial role in its export economy — would have received a big blow as a result of tariff increases.”
The non-discrimination or “most favoured nation” clause is also a cause of protest. According to the clause, countries that have signed an EPA are not allowed to discriminate against the EU.
“According to this clause, tariffs on EU products cannot be higher than the levies imposed on goods from developing countries,” said Davies. “EPAs thus prevent other developing countries from having an advantage in bringing their goods on the markets of developing nations.”
Despite these and other objections, 31 countries so far have initialled an interim EPA on trade in goods with Europe, which could eventually lead to a full agreement including services and “trade-related” rules. — IPS