Strengthening EU-Africa Trade

Published on 9th June 2015

Trade is a key part of development. We have seen how this has worked in Asia but it is also working in Africa so this is an important way of strengthening the relationship between Europe and Africa at a very important moment. Because of course the continent is transforming so fast. Since the year 2000, growth has averaged at over 5% in Sub-Saharan Africa.

In the last fifteen years of the last century it was half the current rate. We have seen African success stories like M-Pesa and Ushahidi, who have ridden on the back of a huge deployment of mobile phones, a phenomenon few would have been able to predict a few years ago. We have also seen the success of companies in more traditional sectors, like Niger Lait.

There is still a long way to go of course. Gross national income in developing Africa may have doubled since 2005 but it is still only 15% of the global average. But the last fifteen years has shown us what is possible when a continent full of diversity, energy and entrepreneurship is given a chance to shine. The question here today is how trade can reinforce development.

Africa's development path will not take place in isolation in today's globalised worth. It needs trade. We have now entered a new phase in EU-Africa trade relations. A majority of African countries, covering 70% of the population and 80% of GDP, will soon have Economic Partnership Agreements with the EU. That means that Africans are no longer dependent on trade preferences granted by the EU, based on simple goodwill. These are real true partnerships between equals.

It allows us to ask new questions about how that development can work in practice and how we set out a new path for our relationship. And of course I think it's a little be too early now to say exactly what that path should be. But a vital part of the work is of course how we fulfil the promise of Economic Partnership Agreements. If we put them fully into practice, these deals will allow African companies to safely plan their future growth in Europe. That's because full access to the EU market of 500 million consumers is now guaranteed.

It will also make it easier for African companies to expand within their region. That will help them build economic alliances between themselves. That's because EPAs open regional markets. EPAs also have potential to make the business environment in general more predictable and more transparent.

That's particularly the case when it comes to customs administrations. And the rendez-vous clauses in these deals on services, investment and competition offer the potential to go much further. And EPAs will also help African companies to gain access to imports that can help them become more competitive. The deals will gradually and carefully open African markets to European exports as well. That's in our mutual interest. But all this can only happen if they are put into practice.

I hope that our partner governments across the region see that as a priority. And that they also help to develop the institutions, the infrastructure the governance that is necessary to support it and that's a core part of our relationship. We need to take a clear look at this. We need to look closely at the entirety of our economic relations. We must take account of the massive of the continent of course.

In order for this to work we must work together to strengthen democracy, human rights, good governance and to make sure that the infrastructure, the training is there to make full use of the EPAs, and that the benefits go hand in hand with sustainable development and that we find ways to distribute the wealth and growth created. That will deepen our relationship. That will deepen our trade and investment ties for everyone's benefit in Africa and in Europe.

By Cecilia Malmström,

Commissioner for Trade Brussels - European Development Days


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