Trade: EU Shortchanging Africa

Published on 17th April 2006

In the current era of globalization, trade has become a very potent instrument for the achievement of economic growth and development. On African leaders rests the responsibility of mainstreaming trade into Africa’s development process, removing the constraints on the continent’s trade performance and harnessing the opportunities of regional and multilateral trade for the benefit of African people.

 

With regard to the promotion of intra-Africa trade, regional integration has for a long period been of high priority. The main reason for the transformation of the OAU to the African Union (AU) is to accelerate the process of the continent’s full integration, using the Regional Economic Communities (RECs) as the building blocs of the African Economic Community. The creation of a Pan-African Common Market has become urgent as recent developments have revealed the inability of most of our countries to seize the opportunities of globalization due to lack of competitiveness and bargaining power that is associated with weakness of the economies and smallness of the national markets.

 

In pursuit of the vision for a strong, united and integrated Africa, the Heads of State and Government of the African Union have decided to focus their next Summit, scheduled for early July 2006 in Banjul, Gambia, on the theme of African regional integration. There is need to reflect on the progress of trade liberalization in the context of Africa’s integration process and to make appropriate recommendations towards the early realization of our dream for a Pan-African Common Market.

 

On the issue of trade liberalization and market access enhancement “charity should begin at home”. There is therefore an urgent need for the rationalization of our regional integration process, removal of tariff and non-tariff barriers to intra-African trade and improvement of the efficiency and effectiveness of our RECs as key agents for the promotion of African trade.

 

It will be recalled that due to Africa’s efforts, the 4th WTO Ministerial Conference (November 2001) adopted the Doha Declaration which committed the international community to place the needs and interests of developing countries at the heart of multilateral trade negotiations. In the hope that this promise of Doha will be fulfilled, and convinced of the role that the effective participation of African countries in multilateral trade system can play in reducing African poverty and improving the living conditions of our people, Honourable Ministers have collectively and individually participated actively in the WTO negotiations on the Doha Work Programme. They have identified Africa’s interest and concerns and clearly set out in the Cairo Road Map and Arusha Development Benchmarks, a common position on the issues of interest and concern to Africa.

 

As the negotiations of the Doha Work Programme move to the final stage, it is necessary to take stock of the progress made so far and to develop a negotiating strategy that will ensure that the outcome of the round is consistent with commitments undertaken at Doha to make positive efforts that will enable developing countries to “secure a share in the growth of world trade that is commensurate with the needs of their economic development”. The review of progress in the Doha Work Programme negotiations since the Hong Kong Ministerial Conference points to the need to develop an appropriate negotiating strategy for the final stage of the negotiations.

 

Giving expression to the development dimension of the Doha Work Programme requires the enhancement of market access for our agricultural and industrial products and services, the adoption of balanced rules that take due account of the level of our development, and providing adequate policy and  well-targeted technical space  for the building of trade-related  supply-side capacity of African countries.

 

Not much progress has been made in negotiations on the major issues of concern to Africa. The industrial developed countries have mustered the political will to offer the necessary negotiating flexibility that will ensure a favourable outcome of the Round of negotiations for developing countries. In the agriculture and Non Agricultural Market Access (NAMA) negotiations, there has been lack of progress on the mandated work on modalities, with the developed countries being more concerned about protecting their interests and dominant position in global trade than placing the needs and interest of developing countries at heart. This development calls for concerted and collective efforts on the part of African countries to ensure that the negotiations remain faithful to the promise of Doha and achieve fully the development objectives of the Round. Africa has a right to insist that an outcome of the Doha Round negotiations that does not take adequate account of its major interests and concerns will not be acceptable.

 

While improved market access and balanced rules are necessary, they are not sufficient conditions for the effective participation of African countries in global trading system. Of critical importance is the need to remove the capacity constraints, which prevent them for such participation.

 

Economic Partnership Agreement (EPA) negotiations between the EU and four of Africa’s regions/groups of countries pose an immense and collective challenge to our continent in the efforts to integrate effectively into the global economy and use trade as an engine for the promotion of economic growth and the reduction of poverty. It was agreed in the Cotonou Partnership Agreement that EPA should not only be WTO compatible but should also serve as key instruments for the strengthening of our regional integration initiatives and for promoting rapid and sustainable development of our countries.

 

Reports from the various negotiating African groups indicate that much divergence still remains between the groups and EU on how to make EPAs to be effective instruments for the promotion of rapid economic growth and eradication of poverty in Africa. The provision of adequate and additional resources, not only to meet adjustment costs of EPAs but also to enhance the production and supply-side capacities of African countries is critical to making EPAs to serve as instruments of development.

 

The need for coherence between our positions in the WTO and EPA negotiations cannot be overemphasized. Africa cannot afford to speak with different voices on the same issues in these two negotiations. The Commission of the African Union intends to enhance its coordinating role for the attainment of this objective. To provide the necessary policy space for African countries in trade liberalization under EPAs, the amendment of Articles 24 of GATT Agreement should be accorded high priority in the current negotiations on the Doha Work Programme.

 

In both the WTO and EPA negotiations, where we are confronted with more powerful partners, it is important to remind ourselves that our unity and cohesion remains our principal source of strength. We must therefore sustain this unity and cohesion till the very end of these negotiations to ensure that their outcomes contribute to the realization of the objectives of promoting rapid and sustainable development and eradication of poverty in our countries.


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