Thursday, October 19, 2006

EBA, ACP, EPA - or just SNAFU?

Ok - here goes with a first attempt at live blogging... At a European Parliament meeting on the EU's attempt to negotiate Economic Partnership Agrements (EPAs) to replace its current trade agreements with the African, Caribbean and Pacific (ACP) countries.

Peter Mandelson was speaking a little earlier defending EPAs and reassuring us all that everything is fine. But the big crowd of people here from the ACP countries (and the equally big crowd of NGO types) don't seem so convinced. At least not yet.

Until now the EU's trade policies have been - in the awful jargon - 'non-reciprocal' - in other words the EU has offered them access (though often rather limited access) to EU markets without asking them to open their markets to goods from the EU.

That's all going to change in just over a years time. At the end of 2007 the WTO 'waiver' which makes this deal compatible with global trade rules is going to lapse.

There have been all kinds of replacements suggested. But the option the EU is pursuing is to turn the ACP arragement into a series of reciprocal free trade deals (branded EPAs)- which would be fine under WTO law.

Mandelson told us that this isn't a free trade deal. That caused an audible moan, if not a boo - what the ACP countries are worried about is that they will have to open up 80 percent of their trade to the EU (i.e. abolish 80 percent of their tariffs) over the next twelve years. They fear the EU is going to, as General Dannatt put it in another context, "kick the door down" and flood them with (often subsidised) EU products.

Now, there is a long running debate about how to encourage developing countries to open up their trade. Do you (a) set a good example and reduce your own barriers, while giving poor countries 'policy space' to cut their trade barriers at their own speed, or (b) put pressure on them to open up by making access to your market conditional on opening up theirs? The EU says plan 'A' hasn't worked and that it is time for plan 'B'.

Apart from that big question, the EU plan has raised a series of other hard problems. The EU has got the ACP to form themselves into six regional blocs, and wants them to form (basically) customs unions amongst themselves first: essentially half a dozen mini-versions of the EU. That's hard enough in itself.

Many of the countries are in several free trade areas. So countries like Tanzania have to choose between their different partners, and have to ditch one group of friends.

There are good arguments on both sides. But if one thing is clear here, it is that the negotiations are *not* going well.

Apart from a million other concerns expressed by the ACP countries, its clear that the EU's attempt to introduce a set of controversial issues about competition and public services into the talks (the Singapore issues), which the EU was forced to back off from at the WTO, really hasn't helped matters. The real deadline is summer '07. But some of the regional groups have effectively stopped negotiating.

Glenys Kinnock just told us that the Commission 'cannot just continue to offer us complacent assurances'. The ACP council say they are 'apprehensive' and 'concerned'. Now the ambassador from Cameroon is telling us that poor countries are being asked to make a "leap into the unknown'. It feels like a nasty train wreck is about to happen...

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