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Africans speak out against EPAs as unwelcome

Inter Press Service

TRADE-EU: Africans Speak Out Against EPAs as Unwelcome

By David Cronin

8 June 2007

BRUSSELS, Jun 8 (IPS) - When European campaigners suggest that a free trade deal could harm the poor, they typically encounter a frosty reaction from civil servants in Brussels. Still, no one tries to muzzle them.

Yet when a Namibian trade analyst insinuated that the European Union was trying to browbeat southern African governments into signing an Economic Partnership Agreement (EPA) before they had a chance to analyse its consequences, he found himself out of a job.

Wallie Roux, a market researcher for the Namibian meat firm Meatco, spoke out against EPAs in a speech to the Labour Resource and Research Institute in April when he claimed the EU is trying to enter the Guinness Book of Records for the most rapidly negotiated trade agreement in history.

His remarks were reported in Namibian newspaper New Era on April 18. Meatco responded to his claim by suspending him on May 11.

This has led to allegations that officials in the European Commission, the EU’s executive arm, lobbied for his dismissal. However, Elisabeth Pape, head of the European Commission’s office in Namibia, said it is "completely untrue" that any of her staff complained about Roux’s remarks.

Her staff believed, she told IPS, that "Mr. Roux should be able to write whatever his opinion is" but she understood that he had broken a requirement by Meatco that he submit any comments he intended to make publicly to the company’s hierarchy for prior approval. "This is entirely an issue between Mr. Roux and his employer," she said.

Whatever the truth, Roux has clearly touched a raw nerve.

The EU officially launched negotiations with countries from the Southern African Development Community (SADC) in July 2004, yet observers say that participants in these talks are only now dealing with issues of real substance. Confusingly, the EU is seeking to reach a separate free trade deal with a regional grouping describing itself as Eastern and Southern Africa, especially as some of the countries are members of both.

In March this year, the Commission outlined the parametres of the EPA it wants the eight SADC countries — Angola, Botswana, Lesotho, Mozambique, Namibia, Swaziland, Tanzania and South Africa — to sign by the end of this year. Malawi, a member of SADC, has chosen to throw its lot in with the Eastern and Southern African trade group COMESA.

The Commission’s paper came in response to a request for information from the SADC grouping, made 11 months earlier.

Roux has urged the SADC governments not to capitulate to demands that they sign an EPA swiftly. "If you are unwise enough to rush for a deadline without looking at the content of the agreement, then you are signing away your life," he wrote.

The EU side says that an EPA needs to be thrashed out this year to facilitate talks at the World Trade Organisation (WTO). Current preferences on African exports to the Union have been granted a waiver from WTO rules but that waiver will expire on Jan. 1, 2008.

The Namibian government is particularly concerned about what could happen if the EU decides to impose duties on its exports, in the absence of an EPA.

Namibia stands to lose 45 million euros (60 million dollars) if its trade preferences are ended. These preferences entitle it, for example, to export 13,000 metric tonnes of beef duty-free to the EU every year and to sell enough grapes to support the livelihoods of 16,000 people.

The 45 million euro sum is four times more than the amount of development aid Namibia receives from the Union.

"The threat to impose duties is being made subtly and not so subtly by the EU side," Herbert Jauch from the Labour Resource and Research Institute in Windhoek told IPS. "In terms of reaching a fair deal, this is creating the wrong atmosphere."

As well as seeking liberalisation on most trade between Southern Africa and the EU, Brussels is advocating that an EPA should cover such issues as investment, competition, government procurement and intellectual property.

Privately, senior figures in the South African government are asking why the Union is insisting that both trade in goods and services should be opened up. Some have raised concerns that the Union is trying to ensure that European firms can get a foothold in telecommunications and electricity companies, now in public hands.

They are also perturbed that it would undermine efforts to recover from the legacy of apartheid by running schemes designed to promote black entrepreneurs. Under competition rules favoured by the EU, equal treatment for indigenous and foreign businesses would be mandatory, even if the latter are wealthier.

South Africa has already signed a free trade deal with the EU. It was concluded in 1999 after talks stretching more than four years, and required South Africa to liberalise as much as 86 percent of trade.

Action for Southern Africa (ACTSA), a London-based organisation, has complained that free trade has had adverse effects on labour rights. Jobs in South Africa’s footwear factories that were once considered permanent have turned casual since its government introduced free trade policies, the organisation contends.

"It is likely there will be massive job losses and a deterioration in working conditions if an EPA is signed," said Ruth Dearnley, head of campaigns with ACTSA. "This agreement would allow the EU to monopolise the markets of countries, whose industries would be in no way able to compete with them."

Paul Goodison from the European Research Office, which monitors trade between the EU and Africa, suspects that the EU is trying to set a precedent by pushing for a far-reaching liberalisation of the services sector in the SADC countries. Once this has been agreed, it would then be able to seek similar provisions in deals with countries that offer even greater potential for European firms.

In April, the EU decided to launch trade talks with India, South Korea, South East Asia, Central America and the Andean Community. The Commission predicted that if successfully concluded, the resulting agreements could net an extra 40 billion euros (54 billion dollars) for the Union per year.

"The EU’s hardline approach on this has very little to do with Africa," Goodison told IPS. "Their thinking is that if they can get African countries, many of which are least-developed, to sign up to a liberalisation of goods and services, India will have no case for saying ’no’ to it. The EU has the broader trade in goods and services market on their radar screen."