EU-Eastern and Southern Africa EPA faces collapse

THE full Economic Partnership Agreement (EPA) negotiations between
the European Union (EU) and Eastern and Southern Africa (ESA) group of
states could face collapse with the later citing frustration and
uncertainty over the sincerity of its Western partners, 13 years since
the talks began.

Although ESA says it is committed to the full EPA process with EU,
the bloc is unhappy with the sluggish progress. It accuses the EU of
dragging its feet and rather preferring to enter into EPAs with
individual African states outside the collective economic integration
framework.

The EU has been engaged in EPA talks with the African, Caribbean and
Pacific (ACP) group of countries since 2002, seeking to secure World
Trade Organisation (WTO)-compatible trade pacts. According to a report
presented to a Council of Ministers of Industry, Trade and Commerce
meeting ahead of the 20th Comesa Summit of Heads of States and
Government, there is now “a creeping sense of uncertainty” about the
future perspectives of full and comprehensive negotiations between the
two parties, unless the cooperation arrangement undergoes a deep and
strategic transformation to adapt to changing realities the region.

The detailed report that was presented by the Comesa Secretariat, and
seen by The Southern Times, indicates the EU was no longer showing any
urgency towards full EPA negotiations, and appears satisfied with the
interim-EPA – an arrangement that ESA grouping say was concluded under
duress to avoid trade disruption.

“Engagement with the EU has not seen the momentum that is deserves,
partly because the EU has consistently avoided convening a substantive
negotiation session with the full ESA group for various reasons,” reads
part of the report.

“The EU may appear to be happy with the interim-EPA and has
effectively lost appetite to advance full EPA negotiations with the
whole ESA group, ostensibly on account of the absence of new market
access offers from non-i-EPA countries of the ESA group”.

ESA member states demand that the EPA with the EU must support
regional integration and address enhance the capacity of the region to
produce goods and services competitively, while at the same time
addressing critical supply-side constraints.

In view of the recent conclusion and signature of the Continental
Free Trade Area (CFTA), which will require coordination and
harmonization of trade policies and arrangements within Africa, the
Council of Ministers queried the EPA status with EU. The issue also
falls on spotlight in light of the fast approaching post-2020 ACP–EU
relations.

It is the contention of ESA grouping that the past 13-years of
uncertainty have witnessed a lot of structural changes within the region
and globally, which call for a complete remodelling of the EPA
initiative. On the international level, the report notes there has been a
fundamental shift to regional and global value chains, which will
require EPA talks to address regional need for respect of rules of
origin, for instance. It also observes that since 2002 EPA negotiations
with ACA, the geo-political context of international trade and
cooperation has witnessed a paradigm shift given the emergence of new
global players. For instance, China has become the world’s biggest
exporter after the EU while India, Brazil and other emerging economies
are following suit.  Emerging economies are already leading in world
economic growth and are magnifying their presence in other developing
countries, including in Africa. For the first time in recent history,
developing countries collectively account for over half of world trade,
delegates heard. 

Given the ongoing global resource driven growth and the apparent race
for Africa’s mineral raw materials, the report says ESA and Africa at
large should remodel their economic strategy and increase its bargaining
power in these negotiations with other trading bloc. Ironically, the
EU, it noted, has already undergone some glaring changes and has more
than 20 FTAs in force and other mega trade arrangements in pipeline or
under negotiations.

“Such mega arrangements may impact negatively on Africa’s trade preferences with the EU,” reads the report.

Delegates expressed worry that major African countries such as Egypt,
South Africa and part of ECOWAS already have separate EPAs with the EU,
which raises questions about the merits of enhancing and prioritising
African integration. The report further noted technicalities involved in
the overlapping membership of regional states and the fragmented
approach to handling the EPA agenda as many of those who signed the
deal, especially under ECOWAS and EAC, have not begun effective
implementation.

“With such a series of inherent distortions, it is difficult to pin
down any broad proof as to the veracity of EPAs, at least in as far as
regional integration in our region is concerned,” reads the report.

“As the first African region that is implementing an interim-EPA, the
experience and lessons learnt so far are not encouraging for our
region.”

On one hand ESA states have complained that commitments of
development resources under Article 36 of the interim-EPA have not been
forthcoming, despite undue sustained pressure on countries to deliver on
liberalization obligations.

“By implication, we have to question whether the EPAs can serve as
optimal answers for enhancing ESA’s global competitiveness and trade
growth pathways,” reads the report.

As way forward, the report suggested that both parties, ESA and EU
need to speed up negotiations towards a full and comprehensive EPA that
meets regional integration ideals to avoid leaving other members behind.

It also demanded that all the 11 member states of the ESA group
partake in negotiations of a full and comprehensive EPA, without
exceptions with a bias on development issues and capacity building.

The ESA members include Zambia, Zimbabwe, Malawi, Comoros,
Madagascar, Uganda, Kenya, Sudan, Ethiopia, Eretria and Djibouti. To
that end, the ESA sub-region resolved to intensify national and regional
preparations for full EPA negotiations with a focus on outstanding
issues and to continuously share information on progress on the matter.