“The Final Meters and Beyond?” The Conclusion of the Economic Partnership Agreement(EPA) Negotiations and a Development Oriented Implementation? Berlin, 28 March 2007

“The Final Meters and Beyond?” The Conclusion of the Economic Partnership Agreement(EPA) Negotiations and a Development Oriented Implementation? Berlin, 28 March 2007

THE FINAL METERS AND BEYOND? CONTENTS EPAs: A Brief Introduction 4 Experts Meeting 5 Statements 5 Conclusions 15 List of Participants 18 Welcome Address Werner Puschra 19 PANEL 1 After the Conclusion of the Negotiations: Implementation of the EPA – Political Preconditions and Challenges 21 Evita Schmieg 22 Martin Dihm 24 Oumar Tidiane Wade 26 Gervais Nkanagu 28 Abdirahim Abdi 30 DISCUSSION ROUND 1 31 PANEL 2 A coherent Development and Trade Policy Michael Hofmann Samuel Amehou John Mahama Raymond Agaba DISCUSSION ROUND 2 37 38 40 41 42 44 3 Conclusion 47 List of Abbreviations 48 Speakers 49 Programme 51 FRIEDRICH-EBERT-STIFTUNG © Friedrich-Ebert-Stiftung Publisher: Friedrich-Ebert-Stiftung International Development Cooperation Africa Departement 53170 Bonn Editing: Uta Dirksen, Rosina Esmail, Julia Schartz Minutes: Imke Tiemann Photos: Jens Schicke Layout: Pellens Kommunikationsdesign, Bonn

EPAs: A Brief Introduction THE FINAL METERS AND BEYOND? The Economic Partnership Agreements(EPAs) will EPA negotiations are taking place between the EU and replace the unilateral trade preferences that had been six regional groups, which do not however coincide granted to the African, Caribbean and Pacific(ACP) with the existing bodies of regional integration. On countries by the European Union(EU) over the past the European side, the EU is negotiating on the basis decades under the Yaoundé, Lomé and Cotonou of a mandate approved by the EU member states in Agreements. But EPAs are to be more than a pure 2002. The negotiations are progressing at different instrument of trade policy. They are an attempt to link speeds and with varying intensity. But so far a timely development and trade policy to achieve sustainable conclusion still seems far from certain. development and poverty reduction. The key issues like the timetable to shape the remainUnder the German EU presidency the negotiations ing negotiations, the support for the adjustments costs, have entered a crucial phase. The World Trade Orgathe integration or exclusion of the so-called‘Singapore nization(WTO) Waiver, under which EU and ACP Issues’ and the design of the reciprocity remain conobtained an exceptional permission to continue the troversial. Especially the dimension of development discriminatory access granted by the EU to the ACP, policy and the contribution to poverty reduction are expires at the end of 2007. To be in compliance with frequently questioned. WTO regulation a new arrangement thus needs to be in place by January 2008. Friedrich-Ebert-Stiftung(FES) convened a conference of African and European experts on the 28 th of March To ensure WTO compliance the EPA are to be regional 2007 in Berlin to discuss“The final meters and beyfree trade agreements that set out the reciprocal libeond” – in other words the challenges of negotiating 4 ralisation of substantially all trade between the two and of implementing a development-oriented EPA. partner regions. This documentation offers you an insight into the The overall aim of the EPA in accordance with the discussions of that productive day. I would like to Cotonou Agreement is the promotion of development thank the participating experts and the FES team, within the ACP countries. The reciprocal market opewithout whom this conference would not have been ning and the accompanying measures of the EPA are possible. Please note that the views presented in this meant to promote regional integration, the ACP coundocumentation do not necessarily represent the tries’ integration into the world economy and their position of the FES. economic growth. They are also intended to make a contribution to sustainable development and poverty Uta Dirksen reduction within the ACP countries. INTRODUCTION FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? Experts Meeting EXPERTS MEETING On the morning of 28 th March 2007 the FES invited state and non-state actors from ACP countries and the EU to gather for an experts meeting on the EPAs. Statements The meeting was introduced by statements from Davina Makhan, Gabrielle Clotuche, Victor Ogalo and Jürgen Hoffmann: the remaining reviews, the way these will influence and input to the process towards truly developmentfriendly EPAs is questionable. Thus, it remains to be seen if anything substantial will come of the review. In fact, the position of the EU is that negotiations are to be concluded by the end of the year and a lot of the current discussions focus on signing an agreement in time instead of signing a good agreement. Davina Makhan, European Center for Development Policy Management(ECDPM) , introduced the experts meeting with a short update on the review process and the possibilities for concluding the negotiations by the end of the year, which is summarised below: The overall timeframe means that even for a provisional entry into force, there would need to be an agreement in October 07 at the Joint Council, which de facto means that an agreement needs to be reached during the summer. To reach this target seems likely for Caribbean and The different negotiating regions have taken different perhaps even for the Pacific negotiating regions if the approaches to the review. Thus, in the Pacific, the questions of fisheries and services are resolved in review is conducted by the negotiators itself, in West time. The ESA region may also yet reach an agreement. Africa other stakeholders have been involved and in Negotiations with the Southern African Development the East and Southern Africa(ESA) region an indeCommunity(SADC) region has ground to a halt for 5 pendent review was commissioned, to name a few one year, while waiting for a EU response concerning examples. Broadly speaking the reviews of the EPA the inclusion of South Africa. After this has been negotiations have highlighted problems of capacity, agreed, the outcome will largely depend on the linkage both in terms of technical and financial capacities, but with the Trade, Development and Cooperation Agreealso of involvement of stakeholders and ownership. ment(TDCA). The reviews also showed that most regions are very much behind schedule. The tight schedule raises the question of the purpose of the review. Indeed, joint documents are already to be adopted at the Joint Council in May. Whereas the purpose of the exercise, as stipulated in the Cotonou Partnership Agreement, is to provide a comprehensive assessment, allowing for adjustment if necessary, it seems like the review was de facto more of a procedural exercise. As yet, only the Caribbean-European Union joint review is available. With the short time at hand for completing FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? EXPERTS MEETING The negotiations with the Communauté Economique et Monétaire de l’Afrique Centrale(CEMAC) and West African regions remain the most challenging, as there is no agreement text yet. Unless the EU proposes such a text, which in turn would raise serious questions on the issue of ownership, a timely conclusion seems unlikely. What will happen if the EPAs are not signed remains a big question mark. The EU made it clear that a new waiver from the WTO is not an option. The ACP would then fall back to Generalised System of Preferences (GSP), which would imply a loss of preferences and could lead to a disruption of exports, another alternative could be GSP+, here they would need to abide to certain international commitments to profit from enhanced access. The Least Developed Countries(LDCs) can access European markets under Everything But Arms(EBA), though problems of restrictive rules of origin remain in this context. Notwithstanding that some countries may opt out, a delayed signature would lead to a very disturbing period for traders, who would have to change trade regime just for a few months. ceeding with the EPA negotiations, with the expectation that there will be no challenge until the time an agreement is reached, thus keeping the pressure on the negotiations and eventually signing an agreement. While the EU argues that the parties have to abide by WTO rules and this is thus not an option, the ACP argue that the delay of the Doha Development Round can justify a delay for EPAs. Gabrielle Clotuche, ETUC : The Confédération syndicale des travailleurs du Togo(CSTT), on behalf of all the trade union organisations of the ACP countries and the European Trade Union Confederation(ETUC), have undertaken a project aimed at‘Boosting the capabilities of ACP trade union organisations in the Economic Partnership Agreements’. They were supported by the International Confederation of Free Trade Unions(ICFTU) and the World Confederation of Labour(WCL), now dissolved and united within the International Trade Union Confederation(ITUC) as well as by the Bureau for Workers’ Activities at the International Labour Organization. The ACP are actually asking the EU to ensure that if The project results in the publication of a Trade Union they cannot sign an EPA by the end of the year, there Guide supplemented by a Dossier 1 . This joint publibe no disruption. Their position is that it is crucial for cation acts as a resource for negotiators from the them to sign a good EPA. trade unions by offering analyses of central points with a view to promoting the social and human There are also a number of different possibilities other dimensions of the EPAs. 6 than signing an EPA or extending the WTO waiver: We(CSTT, ETUC and ITUC) want this publication to –“EPA-light” sign an agreement under Art. 24, with be widely disseminated and used as a tool throughout liberalisation on substantially all trade, on goods the negotiation regions. We hope in this way to help only, leaving for later all other aspects. workers in the ACP countries and their trade union For now this would mean focusing negotiations on representatives to achieve the objectives of eradicating the essential requirements of WTO compatibility poverty and securing sustainable development and and identifying sensitive products. But the big gradual integration into the global economy as advoquestion remains, as to whether the parties will cated by the Cotonou Agreement. ever be able to go back to the negotiating table after reaching such an agreement. Also for the ACP Let me give here some elements of this Guide and this would imply giving away the only bargaining Dossier. chip within the negotiations, the opening of markets to EU products. The Cotonou Agreement, signed on 23 June 2000, by the EU and 77 ACP countries, had the goal of taking – Another option would be for the EU to continue on board the new rules of the game of EU-ACP cogranting preferences without a waiver while prooperation imposed by the globalised economy and 1 Trade Union Guide to the Economic Partnership Agreements in ACP countries – Available at ETUC: etuc@etuc.org in April 2007 FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? EXPERTS MEETING preserving, to the extent possible, a kind of development cooperation that would heed the constraints of the new international architecture and at the same time move towards a simple free-trade agreement. generalised preferences that covers all developing countries. The signing of an EPA is therefore much more important for the non-LDCs than for the LDCs. However, it became clear that the liberalisation of The trade unions in Europe and in the ACP countries trade plays a central role in recasting development contend that trade and economic integration should cooperation between the EU and the ACP countries, raise the standards of living and of work, not lower because it was put forward as a powerful means to them. contribute to growth targets, to create jobs and reduce poverty. The EPAs are reciprocal free-trade agreeThe reality of the social problems in the ACP countries ments negotiated bilaterally between the EU and the poses a profound challenge to the righteous sequence ACP regions or countries. Their goal is to bring EUof liberalisation, growth and reduction of poverty, ACP trade relations into line with WTO rules. which forms the basis of the descriptive aspect of the dominant neo-liberal discourse, and in particular the But the implementation of the EPAs will unavoidably central place that liberalisation policies hold in struclead to deep structural reforms that will have consetural adjustment policies. quences on the living and working conditions of the 7 ACP populations. It is crucial that these structural In this context, caution is needed when it comes to reforms bring social advances and a reduction of development policies shifting to policies to fight poverpoverty if the EPAs are to keep their promises, otherty, where any discussion of redistribution and employwise they may well be rejected by the people. ment is put aside to focus on and reaffirm growth as the key objective. Economic growth is one of many The negotiations currently in progress with the six aspects of development which is a wider, more comregions are long and complex. The deadline set for plex, and not solely economic process. the end of 2007 will probably not be met. The transition period will be longer, and will extend well beyond Now the EPAs are geared exclusively to economic 2008. growth, the increase of international trade of the ACP countries in the globalised economy. The EPAs reaffirm It should be noted that the EPAs are not compulsory. the hypothesis of positive repercussions of growth But if an EPA is not established, there may be discriwhich neo-liberals count on, whereas past experience mination in the ACP between the Least Developed has amply shown that growth has benefited only a Countries(LDCs) and the non-LDCs because the first minority in the ACP countries. The failure of structural have in any event free access to the EU market under adjustments show that it is not enough to liberalise the“Everything but Arms” initiative, while the nonin order to improve the living and working conditions LDCs have access to the EU market via a system of – quite the contrary! FRIEDRICH-EBERT-STIFTUNG

EXPERTS MEETING THE FINAL METERS AND BEYOND? Economic restructuring in the ACP countries will bear a high price tag and require enormous resources from the EU in the long-term, in accordance with the provisions of the Cotonou Agreement. The governments, in particular those that depend largely on customs revenues, will suffer greater budgetary pressure, as the liberalisation of trade will reduce such revenues. This will in turn have a serious impact on the personnel of public services in numerous ACP countries, as well as on the capacity of governments to provide essential public services such as health and education. Impact studies are indispensable before and after insertion decisions. The EU and the ACP must take measures rapidly to carry out studies on the economic and social impact of the economic and trade policies proposed in the countries and regions concerned. The Cotonou Agreement and the EPAs must guarantee that human rights, and in particular social rights, are The trade-union movement insists that this programme accorded more importance, over any commercial or be multidimensional and on a large scale, and provide financial aspect. These rights must be integrated sysfor: tematically in all EPA negotiations at regional level. − A cancellation/reduction of the debt and a re-converWhereas certain objectives can be approved, e.g. the sion of it in negotiated social and economic activicreation of national or regional markets that existed ties per country, in favour of the populations; only potentially, it is worrisome to note the very une− The addition of official development aid on top of qual control of markets and their components; the such financial resources, that should be increased burden of debt in most ACP economies; the importance (up to 0.7% at least) rapidly; of the informal economy(60 to 80% of workers); the − a rehabilitation of the education and health services, low capacities of the political, economic and social designed as public services, and accessible without 8 players; the absence or very low level of purchasing discrimination; power, etc. All these elements do not plead in favour − measures to guarantee income for small rural proof economic and social development. ducers and small-scale fishermen; − active policies to promote and protect decent jobs The growth of trade between ACP countries takes (in synergy with the International Labour Organihigher priority for these countries than the opening sation(ILO’s)‘Decent Work’ strategy). of their markets to EU products. It is worth taking account of the need – which has been recognised, Trade union proposals for the EPAs: incidentally – to sequence trade liberalisation measures. And the liberalisation measures duly accepted between These agreements must without fail have a social the ACP countries must take priority over the liberadimension. lisation measures in regard to the EU. As a matter of fact, an exaggerated opening of the ACP markets to If these agreements have no effective social dimension, EU competition would wreak havoc on the economies the populations will have no confidence in these proof the ACP countries, whereas an effective integration visions. The success of these agreements depends in of the ACP regions would guarantee that the countries large part on the confidence that the populations and concerned would derive more advantages from a the main actors can show them. So the economic partsubsequent integration with the EU. nership agreements must reinforce the social capital in the ACP States and regions. To that end, social objectives FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? EXPERTS MEETING and participatory implementing methodologies are needed, in particular through the social dialogue. These agreements should contribute to the economic and social development of these regions and lead to a significant improvement in the living and working conditions of the populations concerned. It is important that the negotiations at the level of all the ACP countries comply with certain obligatory criteria: Beyond a well-advised integration in the world economy, trade should be developed, accompanied by the relevant social rights, the reduction of poverty, and the respect of workers’ rights. 2 These criteria should guide the regional negotiations. The EPAs must guarantee that human rights, and in particular social rights, within the meaning of the ILO, In so doing, the civil society representatives must are accorded greater importance over every commerstructure themselves at regional level and have a cial or financial aspect. These rights must be systemapermanent organisation enabling them to draw up tically integrated in all EPA negotiations at regional their positions on a collective basis. The EU must level. contribute financially and technically to the creation and start-up of such a project. This should hinge on three major themes: Every EPA must be flanked by a regional social dialogue • The promotion and guarantee of rights committee. • The promotion of decent work • The promotion of social protection Every regional social dialogue committee is made up of the national and regional public authorities who Furthermore, equality between men and women is an are party to the EPA and qualified representatives important factor in social and institutional changes in (employers and employees from all the production 9 favour of fairness and growth and, consequently, must sectors: craft workers, fishermen, rural sectors and be clearly affirmed in all policies and development forestry, public and private sectors and the informal actions. This dimension is then to be considered in sectors) who are organised or in the process of orgaeach EPA. nising. The emergence of local and regional markets means that the populations must have purchasing power. The promotion of work as systems of social protection must generate regular revenues. In each region, task forces monitor trade negotiations. 3 The organisations representing civil society must without fail be consulted by the task force in order to listen to their analyses, their proposals on social aspects and, more generally, on all development-related problems. The remit of the social dialogue committee is to achieve two additional objectives: • access by all men and women and social rights guarantees • drafting and application of the social development strategy • promotion of decent employment • promotion of social protection 2 Article 50 of the Cotonou Agreement and fundamental standards of the ILO. 3 They comprise representatives from each State and from the Commission, via delegations. FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? The public authorities and the representatives of the due to deliberate restrictive rules and/or standard productive sectors negotiate and decide, by means of requirements while EU exporters have been able a bipartite or tripartite contract, the necessary arranto export to Africa despite the higher tariffs in gements and procedures for the effective achievement Africa. What will happen under EPAs where Africans of this social dimension. open 80% of their market to EU while EU only frees the remaining 3% where same restrictive rules Where necessary, other sectors, such as consumers’ and/or standard requirements still apply? representatives and environment Non-Governmental Organization(NGOs), can enter into commitments for • the EU’s agenda reflects its generic negotiating the satisfactory achievement of these objectives. priorities at the expense of the ACP requirements for flexibility, asymmetry and protection of policy The European and international trade union movement space: is well aware of the challenges that this strategy poses for the ACP trade unions. That is why it has set up ✔ the EU has dictated the nature, terms and conand financed, with a subsidy from the 8 th EDF and the figuration of regional integration in ways that assistance of the Workers’ Activities Department of the has divided the ACP bloc and disorganised their ILO, a programme to boost the capacity of ACP trade proposed organic developments based on Southunions, in particular in the areas mentioned(decent South cooperation. employment and social protection) by means of active ✔ on the one hand, the EU is using the Cotonou EXPERTS MEETING and responsible participation in social dialogue. Agreement and EPAs to secure negotiations on the‘Singapore Issues’ of competition, investment and procurement that ACP countries resisted Victor Ogalo, Consumer Unity and Trust Society, Nairobi and were put off the WTO negotiation table Resource Centre(CUTS-NRC): For the African, Caribwhile on the other hand it has refused to negobean and Pacific(ACP) countries involved, the negotiate Common Agricultural Policy(CAP) reforms tiations with the European Union(EU) on Economic arguing that it is a WTO matter and should not Partnership Agreements(EPAs) are probably the most be an EPA issue. This is a clear case of double important trade talks this decade. This is so since EPAs standards where EU uses WTO compatibility will bring drastic changes to the non-reciprocal trade only when it favours it 4 ? preferences and aid that the ACP states have received ✔ initially, the ACP countries wanted to negotiate 10 from the EU for the last 30 years. Among other things, EPAs as a bloc but the EU effectively divided it is expected that EPAs will bring drastic changes to them into six sub-groups with a justification countries’ volumes and pattern of trade, tax structure, that each group had particular economic, social, aid spending priorities and regulatory policies; all with political, cultural and geographical circumstanserious distributional effects. ces that required sensitivity. Yet, as negotiations have progressed, the EU has advanced a stanAs these negotiations have progressed, the ACP groups dardised set of liberalisation demands on all have advanced some political, conceptual and operathe six EPA groups and this reflects the EU’s tional concerns that: broader trade objectives and negotiating mandate. • the EU has insisted on a concept of development that is purely driven by reciprocal free trade, irre• the ACP governments lack the capacity to conduct spective of its potential to devastate many of the complex negotiations within the time frame proworld’s poorest countries. At the moment, African posed. Up until now, most countries have not exporters have not been able to exploit and beneundertaken proper country-specific studies with fit from the current 97% free access to EU market detailed and more specific simulations that can 4 In the words of Mr. Griffith:“This is mercantilism par excellence. The commission is seeking to use desperately needed market access into the European Union to bribe African countries into accepting trade rules that would be against their interests, and which African countries have already explicitly rejected.” See http://business.guardian.co.uk/story/0,,1966940,00.html FRIEDRICH-EBERT-STIFTUNG

EXPERTS MEETING help in building more effective positions. Should agreed will be influenced by whether or not there is any EPAs be concluded even by end of 2007 before an informed domestic debate in the ACP. But the curthe necessary studies are finalised and thorough rent concerns about EPAs are a pointer to the fact that assessments have been done at all levels – national, the negotiators have not adhered to the set principregional and continental levels – the capacity and les/guidelines of the EPA negotiations. preparedness to enter EPAs on the part of the ACP countries should be considered not to have been Ever since the EU proposed to negotiate EPAs with adequately addressed and any such EPAs should ACP regional groupings(in 1996), all parties have out-rightly be unacceptable. stressed the necessity for EPAs not be standard reciprocal Free Trade Agreements(FTAs), but should • the cost of implementing reciprocal trade liberaliinstead constitute‘tools for development’. In the views sation would cripple small economies unless very of the EU Trade Commissioner Peter Mandelson 6 on substantial additional funding is provided. In most ‘what the agreements must now be about’, the EU-ACP of these economies, more than 50% of government relationship has simply not delivered on trade. It has revenue comes from tariffs and duty collections. adhered to the status quo and to a cycle of dependenWhile EU promises no additional funding, except cy. EPAs need to change so their development focus the remnants of European Development Fund(EDF) is strengthened. They should become explicitly what and 2billion Euros per year for the entire ACP, it they really are: trade and development tools but not is clear that these funds will not make a proporticlassical, hard-nosed, free trade agreements. These 11 onate trade off with the expected revenue loss and aims of EPAs have also been reaffirmed in numerous most critical national social expenditures will have declarations such including the Cape Town, Nairobi to be cut down. and Cairo Declarations on EPAs. Because of its potential“severe effects 5 ”, many Northern/Southern NGOs/Civil Society Organisation(CSOs) have become very hostile to EPAs and want it stopped (there is a Stop EPA campaign and a website). Yet, irrespective of whether they are agreed, EPAs must effectively make choices that create winners and losers. But who actually wins and who loses will depend on the details of the EPA(if it is agreed) and on what other countries do(if it is not). The impact of whatever is The official declarations by the EU and the ACP Group on objectives and guidelines for negotiating the EPAs, issued since the initiation of the negotiations, have shown fundamental agreement about the instrumental role that the EPAs play in pursuing the sustainable development goals of the ACP. These declarations have expressly recognised the importance of implementing competitiveness and poverty alleviation strategies, ensuring EU assistance for structural transformation 5 Many country-level including regional-level impact studies of these EPAs on African economies undertaken by various organisations – ODI, ECA, ATN, ECDPM, UNCTAD, Oxfam, ActionAid et al – have reached a common finding; the proposed EPAs, could under the terms specified by the EU, threaten a wide range of livelihoods and fundamental human rights to food, education, and health, sanitation including economic and social development for a large number of African populations. 6 In his speech and memorandum issued on the occasion of his participation in the Civil Society Dialogue Group held in Brussels on 20 January 2005 FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? of ACP economies and embracing the principles of IV) comprehensively addressing the external effects asymmetrical liberalisation between ACP countries that the EU’s CAP may generate on the ACP ecoand the EU. nomies; and V) the importance of extending effective assistance To ensure that EPAs will deliver the said development, to fiscal restructuring in those ACP countries that there is urgency in the need to establish a set of deheavily depend on customs revenues generated velopment benchmarks 7 that will help in the pro-defrom trade with the EU. velopment monitoring of the negotiations and implementation of EPAs. Such development benchmarks Jürgen A. H. Hoffmann, Namibia Agricultural Trade must be established within a four dimensional frameForum: Inputs by the Namibian Agricultural Trade work that encompasses economic, social, political and Forum(ATF) into the discussion on recommendations environmental dimensions of sustainable development. to the German Presidency on the conclusion of the There is also need for the negotiating parties to revisit SADC-EPA negotiations and the implementation after the EPA objectives and use the principles/guidelines the end of 2007. underpinning the negotiations to establish a set of development benchmarks that will help in pro-deve1. Namibia is a member of the SADC-EPA and a dry lopment monitoring of the negotiations to semi-dry country with 2 persons per square kilometre and an average income per person of about The EPA objectives can be summarised as: US$ 3000, thus making it a developing country. The EXPERTS MEETING ATF is a private sector umbrella body of the Nami• To promote sustainable human development, whose bian agricultural value chain from small-scale outcomes should be expressed not only in economic producers to exporter of agricultural commodities terms but also in the social and political dimensions in external trade only. The ATF is financed by its of development, which implies putting equity goals clients and not by outside funding at all. The ATF at the forefront of trade negotiations and including is, therefore, especially grateful for the sponsorship a broad range of non-state actors in discussion of by the FES to attend this important meeting and trade policy options; and to give some unbiased inputs into the discussion. • to improve the level of productivity and the range of value-added products of ACP economies, and to 2. Furthermore, the ATF is attending technical foster their structural transformation so that their SADC–EPA negotiation meetings and is giving direct 12 production systems shift away from extreme deadvice and guidance as far as agricultural trade is pendency on basic commodities towards the proconcerned. This is a two way street and ATF memduction of goods and services with higher demand, bers are constantly informed on the state of play growth and favourable price trends. in the negotiations. Contrary to most of the organisations present here, the ATF is part of the neIn arriving at the guidelines for the negotiations, the gotiations and does not inform its members by out following five principles were agreed by the two of the negotiations information. parties: THE LAST METERS I) ensuring that no ACP country is left worse off in terms of conditions of access to the EU market 3. It is the declared objective of the Namibian Agrithan under the current trade arrangements; cultural exports sector that a WTO accepted outcome II) the recognition that trade liberalisation should in the trade in goods negotiations by the end of occur on an asymmetrical basis; 2007 is the single aim of its inputs into the trade III) the need for effective programmes to address the negotiation process. As a participant in negotiations supply-side constraints of ACP economies; the ATF is of the opinion that this objective can be achieved by strict adherence to the newly negoti7 At the 4th ACP/EU Joint Parliamentary Assembly in Cape Town, South Africa, from 18 to 21 March 2002, a Declaration on the EPA negotiations was issued. The Declaration, initiated by the ACP members of the Joint Parliamentary Assembly, seeks to‘establish benchmarks’ against which the process of negotiations can be assessed. FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? ated roadmap that will be proposed to a meeting 5. Having made the point for the essential conclusion of EU–SADC EPA trade ministers at the beginning of trade in goods and related issues by the end of of April. Also according to protocol 3 of the Cotonou 2007, how should the implementation and the Agreement, the Ministers will have to officially outstanding negotiations be handled? Agreement concur to the inclusion of South Africa into the has to be reached that, although trade in goods SADC–EPA negotiations. issues have been agreed upon, other outstanding issues should not be taken out of the process, but 4. It is thus utterly desirable to reach a WTO(article should be addressed in ongoing negotiations. This XXIV) acceptable draft agreement in trade on goods would mainly be non-trade issues, with trade in at the end of 2007. For industrial purposes, the services and the other Singapore issues being of negotiations should, if possible, be finalised by 15 main concern to the EU. September, because export contracts are normally negotiated and closed 3 months in advance. There AND BEYOND are three, commodity-based, reasons for this: • One of the major agricultural exports of Nami- 6. Together with other outstanding issues, as cited bia is beef and meat under HS 02 and there are above, the following, very important issues have no GSP provisions for meat in the EU tariff book, to be negotiated: thus an average Most Favoured Nation(MFN) • Implementation of Aid for Trade(AfT) and not rate of nearly 100% of the export value of Harconditioned on acceptance of the EU pressure monised System(HS) 2 commodities from Nato make concessions on non-trade issues, other mibia would make any export impossible. than that are acknowledged by commitments Currently, meat is exported by Namibia against (by Namibia) to the General Agreement on a tariff of – on average – 8.3% ad valorem with Trade in Services(GATS) modules. very stringent listing requirements. • Agreement on a review mechanism, coupled to • The table grape exports by Namibia are(without the implementation of reciprocity by the SADC– taking a very small quota of 800 ton into conEPA members. sideration) tariffed at 8% GSP(no GSP+ is • Adjustments have to be made for sensitive proavailable to Namibia) and Duty-Free Quota-Free ducts, taking into consideration whether there (DFQF) access to the EU would have a huge is any sensitivity in product imports that amount influence on the competitiveness of Namibian to less than 0.05% of the EU market(for example, table grapes in the EU market. beef) 13 • The GSP for fish and fish products is 24%, while these products have currently duty free access to the EU markets. EXPERTS MEETING FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? 7. The effect of loss of revenue(over time) due to tariff phase down periods due to reciprocity has to be quantified and remedial actions have to be agreed upon. Likewise, the preference erosion through EU actions: Review of the CAP, other trade agreements that are giving other competitive member states as good as or better market access to EU markets and consequently will delude market preferences even more, will have to be addressed. 8. Supply side constraints will have to be addressed if the objectives of the Cotonou Agreement can be achieved to the benefit of ACP member states. It is acknowledged that the EU will strive to be able to access the ACP member states on a regional basis for all trade(goods and services) to the benefit of their own member states’ interest, but enough policy space should be maintained to the development of the different EPA’s member states. 9. Lastly: The effect of the newly negotiated trade arm of the Cotonou Agreement should always be viewed by all participants in light of the objectives of the Cotonou Agreement: 10. Development of ACP countries to enable these to participate successfully in global and regional integration. RECOMMENDATIONS TO THE GERMAN PRESIDENCY OF THE EUROPEAN COUNCIL 2007 1. To impress on the EU that a negotiated agreement on trade in goods is necessary for the implementation of the Cotonou objectives. 2. To impress on the EU that in a negotiated agreement none of the parties must fully achieve its objectives, it is in the end a give and take outcome. 3. To clarify to the EU that this is a trade and development agreement and not an exploitation agreement. 4. To instruct the EU to carefully access the impact of SADC–EPA agricultural exports to the EU markets, taking into account the size of both, the total market for all commodities, agreed imports from other countries and the impact of the very small imports from DSSADC–EPA member states. On the basis of these calculations, sensitive products can be offered but have to be negotiated, by both sides. 5. To mandate the EU to ensure that non-trade issues stay on the agenda and that these should be addressed in a spirit of capacity building and harmonisation on SADC–EPA level with a negotiated access outcome that will be phased in over time. EXPERTS MEETING 11. Addressing the rampant poverty and the results 6. To assure that text for review and monitoring be14 of the HIV/AIDS epidemic through addressing comes part of the negotiated outcome of the trade wider and faster trade liberalisation and supply in goods agreement. side constraints. 12. SADC–EPA member countries, and especially developing member countries, have to be convinced that the need to negotiate trade deal holds real benefits for them, otherwise the objective of concluding a trade deal by the end of 2007 can never be achieved. It will be the responsibility of the European Commission to convince the SADC–EPA member states, and especially Namibia, that this is well the case. 7. To address the financial end economic results of the new agreement(loss of revenue, loss of preferences) additional to the normal EDF programmes, after affected SADC–EPA member states have – with the help of the Commission – quantified losses and disadvantages that are a result of the new agreements. 8. To ensure a seamless and objective bound transfer of the Chairmanship of the European Union Council to Portugal, and to include all mitigating measures decided on into the next Chairmanship. FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? EXPERTS MEETING Conclusions oversee. Also the development goals would need to be readdressed and should be measured against the The following minutes briefly summarise the content Millennium Development Goals(MDG) and other agreed of the discussions that followed: development goals, since the EPAs are supposed to benefit the poor. Looking at the current status of the negotiations, it becomes clear that almost all negotiations except for In order to not disrupt trade between ACP countries the Caribbean lag behind the official roadmap. This and the EU a solution has to be found by the end of fosters the doubts for a timely agreement on both the year. In fact having a clear indication by 15 Sepsides. tember 2007 of where the EPA is heading in terms of content would be necessary for the exporting industry The high pressure to stick to the deadline now only 9 of the ACP, since trade contracts would usually not be months away was criticised, as the EU side has also made on a day-to-day basis but months in advance. caused delays. The delays in the Doha Round were further mentioned as one reason for the delay of the Although several problems exist, the EPA seems to 15 EPA negotiations. provide a viable way forward for ACP-EU trade relations. Falling back on the EBA, GSP or GSP+ would Critics claimed that many crucial questions have not divide regions and hinder regional integration. Furbeen addressed by the EU and it is therefore not reathermore, an EPA would have the legal status of a sonable to rush to a conclusion of the agreement. As binding agreement, while EBA, GSP and GSP+ are content should be more important than time, the neunilaterally offered by the EU and can therefore be gotiations should be paced by the requirements of cancelled more easily. The EBA/GSP also have more substance, not timetables. differentiated rules of origin which further hinder trade in these countries. Since the EU will not support a new WTO waiver the question needs to be asked what the alternatives could Another approach presented was to foster a“light”be, should no agreement be reached. version of the EPAs. This would be an EPA for goods only by the end of 2007. From that point on further Some representatives preferred an extension of the steps could be taken by negotiating other areas, such waiver, whereas yet others suggested stopping the as development issues, services, etc. EPAs in their current form. It was argued that the EPAs cannot deliver the expected outcome, but would This was countered by strong arguments that a“light” “take us backwards”. Some countries have not yet version would be contrary to the idea of the EPAs. For fully entered the discussions, and it would therefore trade to have a positive impact on development a be unfair to rush these into a process they cannot yet variety of additional provisions have to be put in place. FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? It was therefore suggested that a ready package should on a negotiated solution that should be„owned“ and be presented to the ACP countries on the basis of which implemented by the ACP regions. In this context, it they could decide whether to participate or not. was also pointed out that myths, fears and anxiety are a major problem in the ongoing negotiations. EXPERTS MEETING ACP countries have a difficult standing in the negotiations. They have a more heterogenic base than even The actors involved should look forward and try to the EU member countries. Especially in West Africa/ grasp the opportunities for the ACP within EPA, such Economic Community of West African States(ECOWAS) as in the areas of market access, rules of origin and the heterogenic mixture of countries seems to hinder services to name some, rather than concentrate on a consensus. The identification of sensitive products anxieties. Both EU and all six ACP regions have said as such as well as their harmonisation between the they intend to do whatever is needed to conclude member countries is delaying further negotiations. negotiations by the end of the year. Neither of the ACP countries in general are facing a multiple burden parties considers requesting a new WTO waiver. The of the discussions on their scarce capacity. Not only ACP would have to pay by way of preference erosion 16 do they need to find an agreement within their corin favour of other developing countries that would responding region concerning the EPAs, negotiate demand equal market access to the EU. with the EU on the EPA, but they also need to negotiate other international trade issues e.g. with the WTO It was argued that the political will is there to get an simultaneously. agreement by the end of the year. EPAs should not be seen as a sinecure but rather as an important element The EU negotiation policies were criticised for not to support ACP led policies to foster integration and paying sufficient respect to the interests of ACP counpoverty reduction. The EPAs are not a bilateral Northtries. Dividing the ACP countries up into regional South concept but foster particularly South-South blocks with the argument of different needs and special cooperation i.e. regional integration. situations, the EU now is accused of trying to impose the same policies on each one of these groups. It was EPAs would help to improve competitiveness of the also argued that the EU is trying to get back what they ACP private sector. Gradual and careful liberalisation lost during former WTO rounds via the EPA. was important. For example, the African Union had recently pointed out that the current taxation of imports This was countered by the argument that EPAs were of agricultural inputs was hampering agricultural negotiated and not imposed. Their approach had growth in Africa. There would be long transition penothing to do with past approaches to„structural riods foreseen under EPA as well as safeguard clauses adjustment“ conducted by others. EPA would be based to enable ACP countries to intervene quickly if required. FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? Hence, ACP companies could gradually get used to a more competitive situation. Trade was to be considered as a critical element of development and should therefore be more integrated into national development strategies. Another strong point mentioned was the need to improve the supply side capacity of ACP countries. The advantages of a reciprocal liberalisation arrangement are highly doubtful to be realised quickly by ACP countries, while it would be possible for the EU to explore their potential almost instantaneously. In order to ensure the success of the EPA a set of benchmarks for monitoring was proposed. Some representatives made clear that a consensus can only be reached if ACP countries are not worse off after signing the EPA than before. E.g. if the aid paid by the EU were far lower than the revenue generated from tariffs and duties. In order to compensate these, regional development funds(especially due to the lengthy procedure of the EDF) should be put into place. Particularly countries that encounter difficulties during the transition periods could use these funds. It was added that tariffs are needed in many countries for government funding. This was countered by the argument that relying on tariffs too much distorts the economy. In reply it was reminded that„development“ should not be mixed up with„aid“. Aid could play an important role for development but alone would not do the trick. Credible, predictable and transparent rules and policies are essential for attracting local and foreign investors. Currently, many investors including ACP investors would shy away from the ACP and rather invest in developed or other developing countries. Therefore, the so-called Singapore Issues are important development issues and an important part of the EPAs. In all six ACP regions these issues are part of the negotiations, most of them even actively propagated by the ACP parties. Questions whether time is still enough to reach a good agreement persist even after this productive round. The consequences of further migration and other social conflicts which can be a result of lacking development have to be kept in mind, and although some answers could be found today, it is still necessary to continue the discussion. 17 EXPERTS MEETING FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? List of Participants of Experts Meeting: PARTICIPANTS Abdirahim Abdi Alexis Valqui Bernd Ludermann Christoph Pohlmann Davina Makhan Gabrielle Clotuche Gervais Nkanagu Hauwa Mustapha Jan Engels Jan Stemplewitz John Mahama Jürgen A.H. Hoffmann Jürgen Eckl Klaus Schilder Martin Dihm Matthias Busse 18 Ndiitah Nghipondoka-Robiati Nicole Nestler Raymond Agaba Sabine Fandrych Samuel Amehou Tidiane Wade Uta Dirksen Victor Ogalo Werner Puschra East African Legislative Assembly Globalisation, Trade and Investment Unit, BMZ Journalist Project Assistant South Africa, FES European Centre for Development Policy Management European Trade Union Council COMESA Liaison Office Brussels Nigeria Labour Congress Resident Representative Benin, FES German Presidential Department Parlamentarian, Ghana Agricultural Trade Forum, Namibia Federation of German Trade Unions, Berlin World Ecology Economy and Development, Berlin DG Trade, European Commission Hamburg Institute for International Economics Agricultural Trade Forum, Namibia Project Coordinator East Africa, FES Ministry of Trade Uganda Resident Representative Ethiopia, FES Ambassador Benin and ACP coordinator Geneva Ministry of Trade Senegal Project Coordinator West Africa, FES Consumer Unity and Trust Society, Kenya Head of Africa Department, FES FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? WELCOME ADDRESS Welcome Address Werner Puschra The conclusion of the European Partnership Agreethe working group have developed common positions ments(EPAs) between the EU and the ACP states, and coordinated their strategies to tackle the sociowhich is to take place by the end of December this political challenges for West Africa. year, will not only determine the trade relations between both partners, but will have a major impact Many of our other panellists are also partners of the on the social development of African, Caribbean and FES. Networking amongst each other and with German Pacific countries. Especially Africa faces a number of and European stakeholders is an important aspect of challenges, which is why today’s conference shall our work. Having this in mind, I hope that today’s exclusively debate the implications of the EPAs for conference shall enable a productive exchange within this continent. One of the tasks of the FES has been and beyond the conference hall on the question of the to accompany this process from the beginning in all EPAs. of the 20 African countries in which we are active. The overall aim of these agreements, which is someWe have focused mainly on assisting our partners to thing we are all trying to achieve, is to enable and identify their interests and participate actively by support sustainable development. The EPAs are to offering information, capacity building and supporting support regional integration, integration of the ACP them in their lobbying work. countries into the world economy, promote their economic growth and, thus, contribute to sustainable An example of our work is our cooperation with the development and poverty reduction. East African Legislative Assembly(EALA)- the East African regional parliament, which is today represenHowever, there is still a heated debate on this deted by the delegate Abdirahim Abdi. On the initiative velopment dimension of EPAs. Critics fear, inter alia, 19 of the FES, the East African Liaison Committee on that allowing the EU increased access to the ACP Trade(EAPLC) was founded in 2003 and comprises markets shall have a negative impact on the developthe members of the trade committees of the regional ment of local producers and industries. In the face of and the national parliaments of East Africa. Due to these controversial views, the question remains how the improved exchange between the national and the EPAs – as an instrument of development policy regional levels of parliament, it has become easier to – fit into the German and European Africa policy. pursue a common and co-ordinated approach, e.g. with regard to international trade negotiations, and Our final panel discussion this evening shall centre hence to strengthen the role of the parliaments in the on this core issue, thus, I would like to ask you to be formulation of trade policies. patient until then. Another example is our cooperation with the West African trade unions. In the regional working group “International Economy and Regional Integration“– today represented by Mrs. Hauwa Mustapha from the Nigerian Labour Congress(NLC) – the FES supports West African trade union federations from Anglophone and Francophone countries with respect to creating expertise in trade policy. National federations within Right now, we would like to take a look at the time after the conclusion of the EPAs. Currently, the EPA negotiations are in a decisive phase. Upon expiration of the WTO Waiver, WTO compliant bilateral free trade agreements are to be concluded, and we do not want these agreements to be referred to as:“operation a success, however, not for patient”. FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? In any case, with the conclusion of the negotiations, the African countries will have to make a number of adjustments, which are necessary, as 50 years after independence many countries are poorer than they were prior thereto. But many questions still remain: Can a step-by-step opening of markets alone improve the situation? During negotiations, the EU in particular has time and again emphasised that one of the most important developmental tasks of the EPA is to promote necessary transformation processes within African countries. How should the general conditions be set up, so that trade liberalisation leads to development? Are the inclusion of the so-called„Singapore Issues“– regulations regarding investments, competition policy, public procurement and trade facilitations – part of it? To allow a comprehensive market access for African countries, non-tariff barriers to trade should be eliminated and the position of African exporters vis-à-vis their European competitors strengthened. The EPAs envisage a longer transitional period before the agreements come into force in their entirety. Whether the EPAs can meet the development policy requirements will largely depend on how the African states shall use this transitional period and what support the EU shall offer. It should not be forgotten that the EPAs are a unique process which are jointly and not unilaterally being shaped by the North and the South. This, of course, does not make the process any easier, but will hopefully bring about better results. WELCOME ADDRESS How shall the state receive those revenues, which it needs to ensure and expand its functions, if tariff revenue is lost in the short term? Is extending the tax base a realistic perspective? And, a question of special interest for us at the Friedrich-Ebert-Stiftung, how can the social compatibility of these adjustment processes be ensured? Today’s list of questions, challenges and unknowns is indeed long, but why not regard it as a stimulus! Keeping this in mind, I wish you all intriguing, illuminating and, last but not least, productive discussions. I am now pleased to welcome Bernd Ludermann, who shall moderate the first panel. We have until now only addressed Africa’s challenges, what about Europe’s? 20 FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? PANEL 1 After the Conclusion of the Negotiations: Implementation of the EPA – Political Preconditions and Challenges Moderator 21 Bernd Ludermann Journalist FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? Evita Schmieg Head of Division, Trade and Globalisation and Investment, Ministry of Economic Cooperation and Development(BMZ), Berlin “EPAs are a brand new way of combining trade and development.” A development-favourable design of EPA needs to infavourable to eradicate poverty in the long run. To be clude: more precise, one precondition is that the ACP regions have to be able to exclude sensitive products. They • Asymmetry in liberalisation in favour of the ACP, must examine where within their national economies especially through the exclusion of sensitive proa potential for growth lies; where the possibility to ducts open markets exists and where not. Liberalisation PANEL 1 • Long transition periods that allow for a developshall serve the objective of gaining competitiveness mentally favourable sequencing of liberalisation – and shall not be a threat to competitiveness. steps(e.g. institution building and reform as first steps) Indeed, the EPAs should come into force on 1 st of Jan• A strong interlinkage between trade issues and uary 2008, but that does not mean that by 1 st of Jandevelopment cooperation instruments uary full liberalisation should be implemented. Long 22 • The inclusion of trade related issues and their transitional periods are being discussed. The need, treatment in a developmentally favourable mantherefore, might differ from region to region. The ner. transitional period can easily extend to the 12 years, which are always mentioned. Even 20 years is a numTo the BMZ it is essential that the development goal ber, which scares no one, and 25 years is also under remains the overall purpose of the EPAs, as is already discussion. mentioned in the Cotonou Agreement. It is important to state that the EPAs are not typical free trade agreeWhat does this mean for the design of the implemenments, but that the crucial point is the link between tation of the EPAs? Long transitional periods allow the trade and development. From our point of view there countries and regions a gradual adaptation to external is no automatism between trade liberalisation and competitors and a gradual opening towards the Europoverty reduction. The EPAs are a brand new way of pean market. Liberalisation always induces adjustment combining trade and development as well as a meneeds, but adjustment necessities can be supported chanism to emphasise the regional integration within during the transition period. This should lead to the each ACP region. They are, therefore, not a new neofact that the EPAs are designed in a way that contriclassical approach from the EU, as is sometimes said, butes to a dynamic and sustainable growth process. but rather the contrary. An example how to use this transition period relates to loss of public revenues through tariff reduction: What signifies a development-favourable design of the Customs duties will fall the further you open the marEPAs? Because for sure they have to be developmentkets, but the complete loss of revenues will not happen FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? on 1 st of January 2008, but after the end of the transition period. And by that time, the loss should not be a heavy burden for the respective ACP States. First, because the whole idea of EPAs is to create dynamic economic areas where new commercial streams can originate and where more gross national product is created. In addition, the transition periods need to be used to reshape the ACP’s financial and fiscal systems in order to compensate income losses from tariff revenues by other revenues(e.g. income tax). Development co-operation shall support such processes. It is the idea to link the EPA-process(negotiation and implementation) closely to funds from development cooperation. European Commission, Member States and ACP States together have established instruments to discuss the needs of the ACP countries for development cooperation(the so-called Preparatory Task Forces). Where is support required? E.g. to strengthen supply-side capacities, negotiating capacities or infrastructure needs. Which need for change arises in connection with the discussion about the EPAs? For us as development politicians it is especially important that in our partner countries the demand for traderelated aid is really articulated and that trade is part of national development strategies. Currently, trade is often neglected in discussions with our partners about bilateral programmes. Nevertheless, during the official negotiations on trade(within WTO or EPAs), traderelated financial support is said to be very important. So we enter a dilemma. It is essential that the role of trade enters the formulation of the Poverty Reduction Strategy Paper(PRSP) right from the beginning. If this happens, we have the chance to focus our development cooperation where the need actually exists. The EPAs should also include subjects such as trade facilitation, investments and services; new subjects which are also discussed under the concept of“deeper integration”. Ignoring these subjects would mean not discussing areas with a large potential for economic development. This does not mean liberalisation towards the EU, but liberalisation within the regions and the creation of a suitable institutional framework. The question is interlinked with having an investment climate which contributes to economic development. This concerns an essential component of regional integration, without which essential areas of development are left out of the EPAs. 23 PANEL 1 FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? Martin Dihm Directorate General Trade, European Commission, Brussels “Once you combine a gradual, cautious liberalisation with regional integration and a wider set of relevant policies, there will be a chance to replicate successes that other developing countries have already made. And that is the idea of the EPA.” EPA will not cure all of Africa’s problems, but if well in European markets has constantly declined while designed they will make an important contribution to the share of other developing countries that did not development enjoy the same preferential treatment have significantly increased. Supply capacity constraints have PANEL 1 • by combining a gradual cautious liberalisation with played a role, but also the different policy approaches. a wider set of policies, And that is the basis of the EPA. The concept of EPA • by fostering regional integration, goes far beyond a North South free trade agreement, • by increasing the attractiveness for investment and trade liberalisation per se is not seen automatiboth from Europe, but also from within Africa, cally as benefiting development. But once a gradual 24 • by creating a favourable economic environment cautious liberalisation is combined with a wider set through the inclusion of the“Singapore” or“developof relevant policies that are complementary to it, there ment” issues, will be a chance to replicate successes that other • by providing financial support to support the prodeveloping countries have already made in other parts cess and mitigate adjustment cost. of the world. And that is the idea of the EPA. The EU does not have offensive short term commercial interests in Africa. There is no pressure on the EU to push under EPA to open markets in Africa. This shows an obvious lack of interest of EU private sector in sub Saharan African or ACP markets. The good side emanating from this is that there is a lot of leeway on the EU side to genuinely consider the development dimension, the needs and constraints of ACP countries as the first priority under EPA. The ACP and the EU agreed in Cotonou that 25 years of preferential access to EU markets have not brought the expected developmental benefits. The ACP share Obviously, regional integration is an important element in the EPA concept. Africa, the Caribbean and the Pacific themselves have decided to opt for this idea. Within Africa the idea of regional integration is at the heart of the African Union process. The ACP have selected the regional configurations within which they negotiate EPA; certain configurations have changed since then. In East Africa there is a reflection process ongoing on the optimal configuration for an EPA. The EU has expressed its preferences in this regard, but naturally will respect the political preferences of its partners. FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? Regional integration is important and good for the and EPA endeavours to contribute to that. Another creation of larger markets that are more attractive for important point is that EPA cannot be considered as investors. In addition, a set of harmonised, credible, the sinecure. EPA is one element in this struggle to transparent and stable rules will go a long way to improve conditions and prospects and ACP efforts to attract investment. One of the basic benchmarks for mainstream trade issues into their development polithe success of an EPA would ultimately be whether an cies. Development can only come through well-designed African businessman would have a greater inclination EPAs, which means that they need to be integrated to invest in the local or regional market rather than into the economic policy and flanked by national potransfer capital abroad. There is a lot of natural wealth licy reforms and policy commitments. in Africa and if more of it is invested in economic activity at home a quantum leap would be achieved. Aid is important for development, but the two are not Of course it is also important to attract foreign direct identical. Development must be steered by the countries investment. Beyond the objective to make ACP markets themselves while aid can support this. The EU has more attractive for investment, some form of markeagreed that aid is important within the EPAs, because ting is needed to“sell” Africa and the ACP more as a there will be a fiscal impact –(although some impact destination for investment. studies come up with exaggerated estimations assuming unrealistic scenarios such as full ACP liberalisaIn this regard, the‘Singapore issues’, which are altion on day one which is not intended under EPA) – but ready part of the Cotonou Agreement, are important. there will be repercussions as well as adjustment Any modern economy needs rules; credible, predicneeds. The EU will help under the EDF. The proposals table, transparent and regionally agreed rules that made concerning the regionally-owned EPA funds are give insurances to investors and economic operators. interesting in this regard and will be pursued further. The EU and others therefore see the so-called“SingaThere is also an additional pledge by EU Member pore issues” rather as important“development isStates to support the EPA process under the“Aid for sues”. Trade-Initiative”’. Any contribution that comes out of that will be additional to the EDF and may go into the This links back to the whole issue of supply capacity. regionally-owned funds that the ACP will set up in The main impetus for supply capacity will come from their regions(example: the COMESA fund). This is an private investment. Of course it has to be supported ongoing discussion which is going in the right direction. through aid, by building infrastructure for example, To move forward, ACP countries need to establish their 25 building capacity in governments or building instituviews on the needs under EPA in concrete terms. tions to meet standards. But the main push must come There is a good chance to jointly move forward speefrom healthy, vibrant and confident private sectors dily on the crucial aid issue. that want to invest and operate in the ACP regions, PANEL 1 FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? Oumar Tidiane Wade EPA Advisor, Ministry of Trade, Senegal “Altogether it’s a problem of partnership.” The two parties do have divergent interests, but theIt is clear that the negotiations are in a very delicate se are legitimate and in the end compatible if tackled stage; some think that they are going to sign; others in the spirit of partnership. say that they will not sign before the end of the moratory period(the WTO waiver). Others say that it will • Technical issues can be resolved. be necessary to extend the transition period. The • The European interest is WTO compatibility and decision is left to chance, which does not seem logical. access to African markets. Rather, it seems logical to discuss the problems we are • The African interest is increased economic and stuck at, so that we are able to move forward. But this financial opportunities. does not work, because we are facing two concerns, • EPAs need to strengthen supply- side capacities of which are both legitimate. African countries through new instruments. • Singapore issues can be discussed, but need to be On the one hand, the European side tends to make tackled at regional level first. the EPA compatible with the WTO and would like to PANEL 1 acquire, with preferential conditions, access to the EPAs have two types of problems. On the one hand, markets of growing countries(total trade liberalisation) there are technical problems like how to reduce tariffs, and gain access to a large dormant consumption how to guarantee that it is asymmetrical, how to make potential. On the other hand, the ACP countries, sure that sensitive products are protected, and how especially the African ones, represented by their to regulate the problem of moratorium, which includes organisations of regional integration, try to use the 26 the delay of the moratorium and the delay of transition. EPA as an instrument for strengthening their economic On the other hand, we have the philosophical problems; and financial capacities, and a tool to gain access to a problem of conception. Altogether it is a problem of the world economy. They do not have a pronounced partnership. interest in gaining market access, because the access they enjoyed under the Lomé regime has led to a To summarise, there seems to be a problem between decline in exports. Hence what they need is not marthe two parties(the ACP states and the EU) concerning ket opening, but a strengthening of supply-side capathe conception of the word“partnership”. However, cities. this notion is fundamental in the Cotonou Agreement, because in the Cotonou Agreement they do not speak These concerns, which seem to be contradictory, are, of a trade agreement nor of a development agreement, however, compatible if the parties sincerely want to they speak of a partnership agreement. The instrument tackle these questions as equal partners. Right now of trade cooperation within the Cotonou Agreement each party tries to solve the problems unwilling to goes beyond pure development aid and trade negotiacompromise. tion. It is based on the notion of partnership. It implicates that the parties are aware of their rights and So far studies show that simply opening the European obligations in every aspect related to the partnership markets only has a minor positive impact, which rather (trade, economic development, finances and good underlines that there is an imminent need to strengthen governance). the supply-side capacities. The support the EU offers FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? for solving these problems comes only from the EDF and the AfT initiative. In concrete terms, the ACP countries in general and the organisations of integration in West Africa in particular want to know which instruments are going to be made available for meeting the economic needs. In an equal partnership this question should be of interest to both parties. How is it possible to strengthen the supply-side capacities of the ACP states, which also serve the interests of the Europeans, since they strengthen their export opportunities? The existing instruments(EDF and AfT) do not answer the need. The EDF has two weaknesses: first of all the fund was just created to help; there is no real element for negotiating its contents. And the second weakness is that the fund is not made to meet the needs that result from the development of a balanced EPA. It seems, therefore, necessary that the ACP countries and the European Union should together develop a new financial instrument with two axes: a public and a private one. The aim of this additional fund is to create a profitable market for both parties. Once this obstacle has been removed, solutions with regard to the technical questions linked to the reciprocal or asymmetrical opening of markets, the facilitation of trade and the realisation of regional economic integration will be found. There is no international law, which forbids the African and European actors to discuss the Singapore Issues; but developing countries do not want international rules in the WTO governing investment and competition within their countries. However, the rules do not state that countries are not allowed to have individual agreements on investments; on the contrary, the problem, which arises is that the African countries cannot discuss topics without having a solid basis within the organisations of integration. There is no common law on investments and on competition in Western Africa. It is first necessary to work on this at regional level and then enter into negotiations with Europe. 27 PANEL 1 FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? Gervais Nkanagu Common Market for Eastern and Southern Africa – COMESA, Brussels “This time everybody should be honest and put all existing problems and obstacles on the table to finally achieve our target of development.” The lessons from Lomé are that market access is not that the few countries that are able to offer products enough. What is needed is: on the European market face tremendous difficulties, e.g. non-tariff barriers to enter the market. The three • The strengthening of supply-side capacities agreements(Yaoundé, Lomé and Cotonou) were not • New regional funds to compensate losses and faciproperly negotiated. Today, somehow everybody still litate trade seems to be pleased, and we moved forward to nego• A review mechanism that links market opening to tiate EPAs. So this time everybody should be honest the achievement of development goals. and put all existing problems and obstacles on the table to finally achieve our target of development. As To start I would like to recall the five principles which partners we should find solutions. guide the EPA negotiations: An EPA has to be an insPANEL 1 trument of development, an EPA has to support the Development is the key word of the negotiations. But initiatives of regional integration, an EPA has to predevelopment means that countries have a supply-side serve and ameliorate all lessons learnt from Cotonou, policy, which is not the case, because of a lack of an EPA has to be compatible with the rules of the WTO financial resources to develop these. The EU among and an EPA needs to allow a certain amount of special other partners could contribute to the strengthening and differential treatment for each country. of the supply-side. If this happens, the ACP will have 28 something to offer on the opened market and also a The major challenge of the EPAs constitutes the delarge market will stimulate production. But first provelopment aspect. The EU has a definition of developduction needs to exist, which is not the case at the ment and the ACP states as well, but both definitions moment. Without development, we cannot talk about will not necessarily say the same thing. The method economic partnership agreements. If precautionary for arriving at this development does not seem to be measures are not taken, the socio-economic and socioshared. According to the EU, development in the ACP political consequences of reciprocal market opening could be achieved simply through trade liberalisation. for the ACP states will be tremendous. The states will At this point it seems important to look at the impact have difficulties satisfying even elementary needs of Yaoundé, Lomé and Cotonou: the European Union because of the reduction of public revenues. Such a market has always been accessible for the ACP counliberalisation would mean the expected market will tries, but so far development has not followed. not exist because of a lack of purchasing power and without purchasing power there will be no economic Certainly, one major obstacle has been the lack of development. supply-side capacities. This is why many negotiators in the ACP nowadays say,“Develop and reinforce our To avoid this, the Central African States propose a supply-side capacities first and then we can discuss development matrix, based on impact studies, to trade liberalisation”. The second obstacle seems to be identify the real needs for achieving sustainable FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? development. The existing funds like the EDF will not satisfy the upcoming needs, amongst other factors due to problems of access. An additional regional fund should be created to meet the adjustment costs. The additional funds should be used for compensation of budget losses and, perhaps even more importantly, improvement of the poor public infrastructure. It is merely theoretical to talk about development and markets if a country like Burundi cannot trade with Rwanda, because there is no road between them. So, first of all, regional integration has to be addressed. A long transition period will not help to solve the problem; we need to have a jointly established mechanism of evaluation that links market opening to the achievement of our development goals. That way we might achieve development. In this regard, one last note concerning the Singapore Issues: yes, concerning all aspects that lead to development and are WTO compatible. We are willing to negotiate all that is possible to negotiate at this point. 29 PANEL 1 FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? Abdirahim Abdi “You have to bring EPA to the people.” East African Legislative Assembly, Nairobi To progress from the short term impact of EPA to the Another recurrent aspect of the discussion is the realisation of long term benefit: question of the transition period. But a new timeframe will not solve the problems. The ACPs had 25 years • A long transition period will not suffice of access and nothing happened. New mechanisms • Quantifiable region and sector specific benchmarks are needed. E.g. benchmarks that will allow the status need to be linked to EPA implementation quo to be measurable and quantifiable. With the help • Financial assistance offered needs to be more of these benchmarks all affected sectors could be idenaccessible than the EDF tified and whether to go to the next step could be justified. • All stakeholders must be more strongly involved These benchmarks have to be country- and region-spein negotiation and implementation process. cific. Some industries will do better than others even with immediate liberalisation. But it is not enough to The EPAs are one of the most important trade issues look at the next 12 to 25 years; the foresight and the that have been discussed for East Africa and for the measurable benchmarks have to go beyond this. ACPs in general. The EU is the largest market in the PANEL 1 larger East African Community(Kenya, Uganda, TanzaSo far EPAs do not seem to have interested a lot of nia, Burundi and Rwanda); most of the exports(36%) people. The people who negotiate are trade ministry go to the EU region and around 26% of the ACPs’ officials and some NGOs. The other stakeholders are imports come from the EU. Thus, the EU is a very imnot present even though EPAs are going to immediateportant trading partner. ly affect everybody’s lives. The positive and negative aspects have to be discussed openly. You have to bring 30 There is a lot of talk about the good that the EPAs will EPA to the people. In the short run, the effects(e.g. on do for African countries: expand our markets, allow competition) seem rather negative; therefore, it is immore competitiveness, lower prices, etc., but the chalportant to look at what the long run could bring and lenge will be to figure out how to achieve this. Another how to get to this long run. Now the problem is to challenge will be to maximise the benefits and miniconvince the population to go for the long run. Some mise the adjustment costs. How to balance these two sort of financial assistance has to apply precisely here. contradictions is the major problem at the moment. However, the EDF does not seem sufficient or appropriate in this context. By the time you are through the Duty free, quota free access has been granted to East red tape and have actually accessed EDF funds the Africa for over 25 years, yet trade activity has gone transition period will be over. down over time. You may wonder what the problem might be. Regional integration is always used as the But it is clear that there needs to be a give and take. key word for solving these problems. We have been The ACP have to reciprocate to this eventual new pursuing regional integration with the expansion of development aid, e.g. in discussions on the Singapore the East African Community. But then again you may Issues. An opening of the markets results in discussing wonder whether the EU is pushing towards these the Singapore Issues. It is not possible to exclude integrated markets to have bigger markets for their competition from the negotiations. In the East African companies or to support sustainable development community a competition policy already exists; these through a positive integration process. rules need to continue if we are going to open the markets to the European Union, which should be done in phases building on what has been agreed upon within the region. FRIEDRICH-EBERT-STIFTUNG

PANEL 1 DISCUSSION ROUND 1 Can external pressure or support promote regional pean financial instruments have to be used more integration? efficiently to speed up economic integration. Currently, the funds are available, but they are not sufficiently Gervais Nkanagu says that regional integration is accessible or targeted. First of all the current financial already a programme that has been adopted by all instruments have to be adapted to the real needs, as African countries, the Regional Economic Communities integration is not only about tariffs, but also about the (RECs) are already in place. If today these countries transfer of funds to integral sectors. He adds that they have not achieved regional integration through their have to drop the tariffs for internal and as well as self-imposed rhythm, it is because there is a problem external trade, and have to invest in integral sectors. of resources. Take COMESA, which has been a free Unfortunately, the Cotonou Agreement imposes a trade zone since the 31st of October 2000. But not all trade rhythm, but not an economic rhythm, on the countries have been able to implement this. Each ACP. country has specific problems that means it is not possible to drop the tariffs in each to the region’s level. Evita Schmieg underlines why all trade-related issues But there is a programme to support these countries are linked with the EPAs. If regional integration is the having difficulties in bringing them up to level with the basis for the EPAs, it is logical to discuss all issues that 31 others. As of January 2008, the COMESA region is going are important for regional integration. Secondly, a to be a customs union. On the one hand the pressure certain kind of pressure by the international context from outside can be a good stimulation, but there can can be useful; the example of quotas in the textile branch also be unwanted consequences. Understanding and under the Multi Fibre Agreement shows this; it was support for the occurring difficulties are needed, rigid only because of negotiations in the WTO Uruguaydeadlines can produce unwanted effects. Round that the EU and other industrialised countries dropped these quotas. Tidiane Wade replies that all commitments regarding EPAs are binding on the trade level. The ACP countries It is important that the development goal remains in are obliged to realise certain objectives to enable free the foreground, but the linkage of issues is crucial to trade. To have this one needs a regionally unified achieve deeper integration. The European Union market, which was not in place in the ACP regions. agreed to increase expenditures for trade-related This created pressure on the ACP countries to sign development aid independently of the EDF. But the regional integration agreements, in order to have in links to the development strategies of each country place at least a customs union by 2007. In West Afrihave to be there; they are the basis for the bilateral ca, discrepancies within the region prevent the speedy negotiations. They are moving towards a consensus creation of a customs union to implement a common on the establishment of regional funds. Germany, external tariff. The pressure put on the region through holding the Presidency of the European Council, thinks the negotiations to establish a customs union is good that these regional funds in addition to the EDF are for overcoming internal contradictions. But the Eurointeresting and need to be discussed further. FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? Martin Dihm underlines that the European Union has outflow of capital. Addressing transparency in governa strong history of supporting regional integration. ment procurement within EPAs is very important as EPA will further be an important instrument to support well; anything that can be done to make public expenregional integration initiatives driven by the ACP diture more effective is deeply developmental since themselves. The African Union(AU) is a good example public money can be saved that would then be availaof the ambition and progress the African states have ble for social expenditure. Integrating these issues into so far made towards regional integration. The idea internationally binding agreements will not mean behind the AU is to aim at integrating the various abandoning the right to regulate, but to ensure that regions so as to create an integrated African continent fundamental rules and economic policies become more in the long term that would help achieving fostering transparent, and predictable for investors and econostability and development. mic operators. This would help stopping the capital flight from Africa. Competition rules are also important Abdirahim Abdi states it is not a question of forcing for the efficient functioning of any modern economy African countries into regional integration. The East and hence for development. Rules on competition African Community(EAC) started that already in 1907 embedded in an EPA would also allow ACP to address and had a monetary union before the EU. Even though better uncompetitive behaviour of internationally the region broke up in the 70s it was“reanimated” in operating enterprises. It takes time to build a solid 1993 and has been doing very well since. There are competition legislation and administration. So the of course problems facing regional integration, such approach would be gradual and has to be supported as Tanzania’s multiple membership in regional inteby development cooperation. gration groupings. Thus, they do not need the EU to force them into regional integration, instead they According to Tidiane Wade , the Singapore Issues pose rather address the EU for capacity building. They are two problems that have not been solved so far. Is asking for a level playing field. The infrastructure needs Europe in a position to negotiate a priority access to PANEL 1 to be improved to be competitive. Once the agreements the African markets compared to other investors like are signed there will definitely be competition with the United States or Japan? Are the African countries European firms. This competition will affect every in a position to discriminate in favour of Europe? The country. ACP countries certainly will not accept that without heavy discussion, because there is a fiscal problem. On the inclusion of the Singapore Issues Giving a preference concerning investment to Euro32 peans would mean disadvantaging other sources. And Martin Dihm: The EPAs are an opportunity to address there is also the problem of national investors that crucial rules important for trade and economic dewant to have national preferences. Do they have to velopment such as credible investment rules. There compete with strong European investors? is currently too little investment in Africa and a net FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? QUESTIONS FROM THE AUDIENCE: What happens if after the WTO waiver lapses one of the six regions has not reached an agreement? there will be additional funding shows that the EU is taking responsibility. Zoe Coulson (New Zealand Embassy) wants to know what would happens if after the WTO waiver lapses one of the six regions has not reached an agreement? Martin Dihm answers that the EU and all six ACP regions currently negotiating EPA have committed in joint ACP-EU ministerial declarations to undertake the necessary efforts to conclude negotiations by the end of the year. Gervais Nkanagu adds that they will not end all negotiations by the end of the year, but in the area of trade in goods the negotiations are well on their way. Davina Makhan also wants to comment on meeting the deadline. There have been joint declarations that the parties are committed to meeting the deadline. The ACP countries have framed the definition of the exact content of the development dimension of the EPAs as being necessary prior to meeting the deadline. Tidiane Wade does not see a real problem that one What is the outlook for concluding an ‚EPA light’(an region will not be ready to sign. But if this should agreement on trade in goods only) by the end of the happen, there either need to be new negotiations for year, as has been suggested in various discussions? a WTO waiver, which means the EU will have to make concessions, which it might not be ready to, or the Martin Dihm insists that“EPA light” would not deliver countries will just go back to international law, such on development and that the parties should try their as GSP or EBA without a free trade zone. best to conclude full EPAs by the end of the year. This has been confirmed at the political level in the six Will it be possible to conclude the negotiations by the recent ministerial declarations. A number of regions end of this year? are already preparing offers on goods and services. The EU has declared its willingness to include Mode Margret Tovar (Netzwerk Afrika Deutschland) has two IV(movement of persons) and to come out soon with questions: With time passing quickly she wants to its market access offer. Progress has been made in the know how the ACP states and EU think they will connegotiations in particular over recent months. 33 clude the negotiations by the end of the year and actually sign the agreements given the many open Gervais Nkanagu comments that most governments questions that still remain, such as the Singapore have already shown their will to conclude the negotiaIssues? Where are the advantages for the EU to go for tions within the time frame. He gives the example of the EPAs, given that the African markets are already the rules of origin, which are based on value added swamped with European products? and are currently under discussion within the regions. Furthermore, he communicates his surprise that the Tidiane Wade repeats that the ACP countries are going civil society stakeholders take so little interest in this to have two possibilities if they do not sign the agreesubject, which is going to determine the developmenments by the end of the year, but that he still has faith tal value of an EPA. that it will work out. The Cotonou Agreement states that the regions have to set up a free trade union by Evita Schmieg adds that the EPA discussion started 8 2020, it is just the process of how to get there between years ago, because the partners from the WTO were 2008 and 2020 that has to be agreed upon by the end no longer willing to accept the exception for the oneof this year. To reach this is not a technical problem, sided preferences and everybody was disappointed but this agreement is going to cause turbulences in with the results, as they could not stop the marginamany countries, and the Europeans have to claim their lisation of ACP states from international and European responsibility concerning the adjustment costs. The trade. Therefore, an EPA light would not be the soluEU is beginning to understand this and the fact that tion; it would just help them to conform with WTO PANEL 1 FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? rules. It would not move along the integration of the Klaus von der Ropp (Potsdam) wants to clarify that ACP countries in the international trade and would the EU is not dealing with COMESA directly concerning not guarantee sustainable development. the EPAs, but with ESA and SADC, which are parts of COMESA and parts of SADC. What they aim for are reform processes that contribute to sustainable development; they have to be carried Gervais Nkanagu clarifies that while the negotiation by the civil society, and therefore discussions like today configuration is not COMESA, the ESA configuration are very important and have to be brought back into has asked COMESA to coordinate the negotiations. the countries. Davina Makhan wants to know which regional inteAre the EPAs a means of ensuring preferential access gration we are talking about; what is going to be the to ACP economies for Europe? basis of the continental integration, would it be through the EPAs or through the RECs? Sadjo Komlan (Togo) would like to know what competition means in the context of the EPAs. Does it mean Abdirahim Abdi replies that the Africans chose to go competition between the ACP countries and the EU or for both these groupings and that it was not the EU between the EU and the Asian countries? Does the EU who forced them to do so. He is convinced that rewant the African states to close their doors to the gional integration is one of the best things that has Asian market to have better access? happened to them, and that it is up to them to solve the problem of which country belongs to which region. Martin Dihm underlines that there is no intention to Regional trade among ACP countries should be enkeep anyone out of trade; it is up to the African or ACP couraged. Above all they should not forget about the countries to decide with whom they want to entertain Cotonou spirit to gain sustainable development and what relations. Some stakeholders have promoted the to eradicate poverty. PANEL 1 idea for the ACP to open up on a voluntary basis to all trading partners in parallel to opening up to the EU Will the adjustment funds in question be additional under EPA; however the ACP might prefer to keep to existing aid commitments of the EU? some negotiating chips on their hands that could still be used in other bilateral negotiations with important Klaus von der Ropp Furthermore, he would like to trading partners. At any rate it is not up to the EU to know more on the additional regional funds being 34 decide on this issue. discussed to help the individual EPAs in their effort for development. Are these really additional funds or According to Tidiane Wade every agreement includes are they going to be financed out of the EDF? discriminatory aspects for a party that does not take part in the agreement. If they are negotiating it, it is Gervais Nkanagu answers that they are currently because Europe deserves this preference, because it discussing additional funds separate from the EDF is in the interest of the two partners – that is what is with the EU, because their content differs from what meant by a partnership. has been agreed on in the EDF, they need to respond to specific needs. Gervais Nkanagu adds that the Chinese are already in the African market; they have identified the needs Davina Makhan would like to know the exact shape and have a very good trade policy. But in addition to of the additionality of the aid that is going to be available this, there exists a long history with Europe, which for the ACP countries, both in terms of level and should now lead to a signed partnership agreement scope. that is advantageous for both parties. Evita Schmieg refers to an EU plan as how to attain The negotiating configurations and regional integrathe 0.7% of GDP development aid goal step-by-step by tion: 2015. The BMZ is interested in increasing the share FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? PANEL 1 of trade-related aid, but they need their partners to in the ACP countries. A good EPA to him should be make proposals to invest in trade. This should not just one that would fast track the completion of Doha happen during the concrete trade negotiations, but negotiations. EPAs should be compatible to WTO rules, also during the discussions concerning the PRSP and but how can something be compatible with something bilateral aid. The German Presidency is currently that is not even complete? If the EU wants the ACP to developing EU Council Conclusions on a common have EPAs by January 2008, they should also push (Union and Member States) strategy on Aid for Trade. for the conclusion of Doha. Regional integration is a slow process, that moves at Martin Dihm replies that the EU is coming out with an different speeds but will be good in the long term. The offer on Rules of Origin, which are one of the key factors BMZ proposes for the ACP countries something like determining the developmental value of an EPA. the EU equalisation funds; the idea is to have an instrument for promoting regional integration and this Tidiane Wade suggests that the countries should disinstrument has to be fixed within the regions. It is cuss a longer delay than 10 or 12 years to realise the clear that the EU will support these instruments. free-trade zone. But it is clear that they need to dis35 tinguish between the delay of the negotiations and the What is the ACP development interest in EPAs? delay of the realisation. Victor Ogalo (Consumer Unity and Trust Society – Kenya) thinks that the EU and the ACP countries have not always been honest with each other. The EPAs are more a problem of the ACP states than of the EU. EU markets are already open to the ACP countries, but not vice versa. The ACP want a rules-based system in a transparent manner. Rules that should recognise the increasing global nature of input procurement and allow the ACP countries to procure inputs from other countries. They want an EPA that will ensure a fast opening of markets among the ACP and an opening towards the EU that will be linked to predetermined development indicators rather than to predetermined timetables. The EU needs to provide sufficient resources, because so far the necessary structures are missing According to Evita Schmieg , the WTO never framed the transition period as 10 years. Article 24 for freetrade zones defines 10 years for industrial countries, but says that it can be longer for poorer countries without giving an exact number. The ACP countries and the EU are jointly shaping the period and afterwards have to convince the partners from the WTO to accept it. She is confident that as long as EU and ACP seriously continue negotiations on EPAs, concluding them will be possible. But they cannot expect understanding from other developing countries for discriminatory practices. Ndiitah Nghipondoka-Robiati (Agricultural Trade Forum, Namibia) says that it should be kept in mind FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? that African development is not going to be solved by the EPAs. African countries need to articulate what their development goals are and how they are going to achieve some of them through the EPAs. With their own objectives they can engineer instruments that can try to achieve these goals. The Europeans are not going to solve Africa’s problems. According to Tidiane Wade , it is clear that Europe is not responsible for solving all the economic problems in Africa, but they should participate in the adjustments costs created through the opening of the markets as this will have an extensive economic and financial impact. How can remaining barriers to trade on the European side be addressed within the EPA negotiations? Martin Dihm responds that the aspect of agriculture seems neglected in public discussion. The example of tomatoes shows how important the EPAs are, because they aim at strengthening customs authorities and hence will enable ACP countries to implement effectively their chosen trade policies. The EPA would allow more control over whether a country actually wants to accept subsidised products in its markets or not. In the WTO, the offer to abolish all export subsidies by 2013 is on the table. There were other earlier and similar offers in this regard that, unfortunately, did not receive a response due to divergent interests within some of the countries concerned. The elimination of export subsidies could be discussed under the EPA with those regions that are willing to open their market with regard to the relevant products. Samuel Amehou says that Africa has already been in Tidiane Wade would like to know if it is possible to a partnership with Europe since the 60s; but that it is give special treatment concerning the export subsidies true that the new partnership needs to be more strongly within the free-trade union? oriented towards development. The question should be why all the agreements in the past never held what Evita Schmieg agrees that the EPAs are a great opporthey promised. According to him the absence of impact tunity for discussing joint questions, such as subsidies studies is a factor. That is what is needed now for each and non tariff barriers to trade. The great advantage subject. Another problem is that African producers of EPAs is that they are being negotiated, so the ACP cannot compete with European producers, especially has the opportunity to make demands, e.g. on Mode in the domain of agriculture. The ACP countries want IV or subsidies. to discuss the Singapore Issues, but in the form of an equal dialog. What is the EU prepared to offer in terms of restricting subsidised products? 36 PANEL 1 FRIEDRICH-EBERT-STIFTUNG

PANEL 2 THE FINAL METERS AND BEYOND? A coherent Development and Trade Policy Moderator Stefan Mair German Institute for International and Security Affair Berlin 37 FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? Michael Hofmann Ministry of Economic Cooperation and Development (BMZ), Berlin “Regional integration is the best dynamic you can think of.“ When we talk about coherence in trade policy, we modities have been able to develop very well in other cannot leave aside the Doha Development round. Thus, regions. Therefore, for all three types of countries before I turn to the EPA process, let me first address regional integration is important; regional integration this important issue. In terms of coherence the Euro- is the best dynamic you can think of. pean Union gave various positive impulses to the Doha round, especially with regard to cotton. There is a The chances to persist in world market with classical disconnection of cotton production on the one hand products like commodities are without prospects in and the income of cotton producers on the other. We the long run. For example West Africa should not had difficult internal discussions, but in the end the concentrate on cotton alone, but needs to diversify, Europeans understood that this is a problem of using the possibilities of regional trade and thus procoherence and acted accordingly in the Doha negotia- fit from world trade. The EU has been offering prefetions. So nowadays, the problems West African coun- rential market access to ACP countries since the 1970s, PANEL 2 tries are experiencing in this area are much more but since then these countries could not increase their closely linked to the US policy on cotton and the ball exports as expected nor could they diversify the prois now very much in their(the US) court. ducts they export. The EPAs will guarantee preferential market access for ACP countries beyond the But we are here to discuss the EPAs. To summarise, phase-out of the WTO waiver at the end of 2007. The EPAs can support development especially in three existing preference regime under the Cotonou agree38 areas: ment is not compatible with WTO rules, so there was an additional necessity to act, clearly non-reciprocal • By supporting regional integration. market access was not tenable. The European Union • By fostering economic diversification; will offer improved market access that builds on the • By making Africa more interesting to investors. aquis of the Cotonou agreement. However, we also need to keep in mind that the EU has changed since We know that the construction of regional markets is the beginning of the negotiations in 2003. After the a necessity in a globalised world, because the econolast enlargement round in 2004, new European Memmies of African, Caribbean and Pacific countries are ber States might be likely to see ACP countries as too small to compete in the world market and, furcompetitors. Above this, EPAs are a lot more interesthermore, the economies are too little diversified. With ting than the Doha round, because the EU is able to regard to regional integration we have to differentiate accompany the liberalisation process with close supbetween three types of countries in Africa: I.) Coastal porting measures that go far beyond classical aid for countries rich in commodities, II.) coastal countries trade, in areas such as customs collections and compoor in commodities and III.) landlocked countries pliance with standards. that depend on the dynamics of neighbouring countries. The question is how we can develop such regional The strategy of the EU focuses on making Africa ateconomic dynamics. Coastal countries poor in comtractive for foreign investors and producers. Experience FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? has shown that a lack of legal certainty, for example on questions of property, land or bankruptcy, can put investors off engaging in a certain country or region. Investment provisions contained in the EPAs are aimed at promoting good governance and a secure environment for investment, so as to attract or stimulate pro-development domestic and foreign investment. Asian successes were not only due to an Asian interest in international markets, but also to the fact that there were investors realising how interesting Asia was to them. A strong dependence on just a few commodities is an obstacle. A comprehensive approach is missing and needs to be developed. Some actors in Africa agree and want to use their chances, but others do not. It becomes an African question of deciding and clearly articulating what they want. Extending the waiver is out of the question, so the time until the end of the year has to be used in the best way possible. The EU is willing to make attractive offers to ACP regions in market access in goods, but there also remains work to be done – not all Member States will like what the Commission offers, and we still have to do everything we can to convince all the EU Member States of the attractiveness of Africa, but belief in regional integration has to come from the African states themselves. 39 PANEL 2 FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? “Africa is interested in trade and not in aid.” Samuel Amehou ACP African, Caribbean and Pacific Group of States, Geneva If the European Union really wants to be coherent, it should revise the subsidies given to their producers. The goal of cooperation between the European Union and the ACP countries aims to stimulate the ACP countries. But does our current behaviour, the behaviour of the ACP countries and of the European Union conform to the goal of sustainable development? Not all activities have been coherent. The example of the subsidies the EU grants to their farmers shows certain incoherence, because they have without doubt a negative influence on African markets. Agriculture is very important to most African countries, but the subsidised products from Europe coming to Africa discourage the local farmers. The farmers lose their already rather weak ability to compete. This point is not coherent. On the one hand the EU grants funding and on the other they put the African economy at risk. Cotton is another very good example to show how subsidies destroy the economy in Africa. And the EU has to accept a share of the responsibility. Because of these subsidies, Africa is no longer competitive and is losing its income. If the European Union really wants to support African producers and wants to be coherent, it should revise the subsidies given to their producers. Calculations say that every year Africa is losing more money just in cotton than it gets through all of the different development funds. Africa is interested in trade and not in aid. PANEL 2 40 FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? PANEL 2 John Mahama Member of Parliament Accra “This new generation wants to prove that Africa is not a basket case, but a continent that is ready to compete with the rest of the world.” • Africa should take responsibility for its develop- The option of a rules-based trading system is no longer ment. an option; it is a necessity. It is not possible to go back • In certain sectors it is now well positioned to comto anything else, we need fairness and equity. Trade pete internationally. issues are very important, but unfortunately the way in • To be able to compete a fair and equal playing field whichmanyofthenegotiationstookplaceinourcountries has to be establishe d. has not been consultative enough. The fact that a lot of the people concerned with the EPAs, including many There are long standing relations between Africa and parliamentarians, do not even know anything about them Europe, with Africa’s main trading partners being is going to have a negative impact on our countries. European countries. In most cases Africa was colonised by European countries. Since independence, most In the discussion with Europe, Africa is to put safe countries have moved in a new direction and Africa guards in place. Certainly, development is a key issue has tried to reorder itself in terms of surviving as inof the EPA; there should be good quality development dependent nations, which is not always easy. There and it must be a comprehensive package. This will is no need to blame external factors for most of the support African countries in developing the ability to problems. Since independence, Africans have had the compete. In Africa, most of the producers are smallchance to conduct their affairs in a better manner and scale producers; their basic aim is not commercial 41 could have achieved much more than they have now. agriculture, but the simple necessity to ensure food But instead, post-colonial Africa was marred by dictasecurity for their families. But we should also not torships, misappropriation of public funds, etc. It was underestimate the role of markets to them – excesses not until the late 80s that a noticeable wind of change produced are sold on the market to provide cash inbegan to blow; new presidents are ready to overcome come if needed and livestock such as goats can provide the old dictatorship style. This new generation wants to an insurance for these families that way. These tradiprove that Africa is not a basket case, but a continent tional producers are losing out; they cannot compete that is ready to compete with the rest of the world in with e.g. the cheap chicken parts coming from Europe, terms of trade and other issues. We have a comparative flooding urban markets. The barriers to trade have to advantage in agriculture and agro processing. The be removed. African farmers are able to compete, if manufacturing base in Africa is less strong than in they are helped technically with the capacity to proEurope, America or Asia, so it is going to take longer to duce more efficiently. But will all the barriers and be competitive in this sector. But in the sector where subsidies be removed? If so, African producers will Africa has a comparative advantage, the continent wants be able to compete. We have gone through some rough to have a situation where there is fairness in the exand painful processes to get to where we are today: change. Ghana has 6% growth rate. The revenue generated flows back into social services, making it an important factor for development. FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? Raymond Agaba Ministry of Trade, Kampala “Coherence is lacking within the ACP and between ACP and EU” • ACP had expected the Doha round to define the donor community is believed to be a result of lack of framework for the negotiations of the EPA. transparency, which shows the need for fighting cor• African states could be willing to discuss some, ruption. Once corruption is reduced, then – maybe – but not all the Singapore Issues. Africa could be able to attract donor assistance and • Problem of multiple memberships in negotiation be able to address some of the outstanding economic groupings needs to be solved on the political, not issues. technical level. • Africa needs support that is more accessible than The problem of multiple memberships in regional the EDF. integration(e.g. Tanzania in SADC and Kenya and • EPA light is proposed as a fallback position. Uganda in ESA and yet the three are members of the East African Community) is also an example of a lack The negotiations have played out different to what of coherence in the policy. This is a problem that was planned in the Cotonou Agreement. We were governments, politicians should resolve. It is not a PANEL 2 expecting the Doha Round to be concluded before the technical issue. EPA negotiations find their end. That would have set the rules for the EPA. We expected predictable and Looking at the 25 years of development and trade transparent rules under the auspices of the WTO but cooperation with the EU under Lomé, Uganda does the ACP have not realised this objective. So today not seem to have taken any advantage(in terms of 42 there is the question of which rules we are going to utilising the Market Access Preferences). It did not for put on the EPA negotiations. Already the fact that the example make full use of its sugar protocol quotas, Doha Round did not conclude is a lack of coherence while other countries that exploited them more effecand complicates“sequencing” of the negotiation clustively, such as Mauritius, have been able to make ters for different regions. Of course, uncertainty is at great progress on this basis. We cannot blame the EU times part of negotiation processes. And there is still for that, but rather our own countries(ACP). commitment between the parties to try and conclude EPAs according to the Cotonou Agreement. Looking at the negotiations as they are proceeding right now, there are already many issues of convergence The fact that the WTO has not set rules concerning between the negotiating parties. If, for instance, all the Singapore Issues or procurement means that the the joint conclusions between the ESA and EU could African states have a fallback position, which is to be implemented, there would be no doubt that EPAs discuss some, if they so choose, but with no obligation would move the ACP trade agenda forward. But the to discuss all of the Singapore Issues. For some countruth is that these principles are not easy to fulfill. In tries, public procurement seems to hold a lot of relethe context of the EDF a lot of money is promised, but vance. For instance in Uganda some stakeholders seem rarely fully utilised. There is a problem of accessibility to hope that procurement could help put in place more due to stringent EU rules and bureaucracies. We have transparent rules. The misuse of resources from the not addressed the infrastructure issues; many things FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? have not been done. Now additional funds are being discussed but what assurances do we have that the same problems will not occur again? Coherence is lacking within the ACP and between ACP and EU, and due to past experiences even if we agreed to the joint conclusions there is a suspicion that they may not be met. Talking to different stakeholders gives yet another picture: the civil society is against signing; the private sector wants to be assured that its trade will not be interrupted. The government now has the challenge of deciding what to do. That is why we would like to continue the negotiations until there is hope of achieving better results/ positions. That is why we propose, in consultation with all the stakeholders, the EPA light at the current time as a fallback option to ensure continued access especially for our goods come 31 December 2007. Negotiation of other sectors such as services and trade-related issues could be concluded later. The approach differs depending on the regional peculiarities(priority sectors). 43 PANEL 2 FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? DISCUSSION ROUND 2 How do we achieve diversification and what role does made attractive to European investors and thus Aid for Trade play? worthwhile investing in. This is only possible if Africa shows that it is heading for regional integration and Samuel Amehou says that it is true that there needs thus the creation of bigger markets and improved to be more diversification in African markets to attract infrastructure. But the German G8 programme can European investors and this is an issue which is being only communicate this, if it has a clear signal from taken very seriously by Africans, but it is not easy for Africa. For this it is necessary to really make something many African countries to achieve diversification. It of the EPAs. PANEL 2 takes expertise, resources and years to set up new sectors. And the problem of subsidies still persists, It is true that EPAs have so far just been discussed this means that Africans cannot sell these products. among experts; this has to change. Another incoherence In a certain way the EU forces Africa to produce basic is that the civil society is creating a network called commodities so they can buy and market them. Tariff ”Stop EPA” and that none of the presidents from the escalation forces them to export unprocessed goods, ACP countries ever says,“stop EPA”, but rather –“there 44 while the real value added is in processing. He wants are some problems, let’s negotiate these”. to believe in“Aid for Trade” but fears that it might be just another catch phrase to appease the African comDuring the transition period the Europeans will figure munity. The international community often does not out how things are going and what support is really follow-up on their decisions. Aid for trade needs to be necessary. The 10 th EDF will have an Aid for Trade additional and controllable and dedicated instruments element within the regional envelope. In the EPAs, should be created to ensure this. long transition periods are possible for ACP liberalisation process of goods that are important to food Michael Hofmann admits that there are incoherencies, security and sustainable livelihoods, especially in the question is how they can now be removed. At the rural areas. When liberalisation is implemented, some moment the German government is preparing the of the losses will be compensated by the positive deupcoming Africa Summit in Lisbon. In this context, velopment of other sectors. Other losses may be absolute, they developed a new partnership, which is currently but the EU will continue to support ACP countries. being discussed by the African Union and the EuroThere will be an 11 th and 12 th EDF and so on. And pean Union. In the German G8 programme there is there will be the possibility to influence this positivean“Africa” pillar where they explicitly try to give Africa ly. Adjustment compensation will be necessary. Also a new, better image. One of diversity and growth, that the European Union needed them for its integration, is not just due to resource prices and democratic the SADC-EPA group needs them. But the Europeans leaders. European businesses are not“forcing open” have to wait and see the real need and not write African markets, instead African markets have to be cheques in advance. Together something is being done FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? PANEL 2 that is new to all. Not everything can be foreseen; it Hauwa Mustapha (Nigeria Labour Congress) comments has to go step-by-step. That is a partnership. Everyon Africa’s own responsibility to shape things like they body should also be honest about the dynamics of are needed. Africa has the moral responsibility to take negotiation processes. Progress is often only visible in the ownership of its development process, but at the the last minutes. same time it should be made clear that Europe has social responsibility and political obligation towards Are the objective of the EPA and regional integration Africa and a moral justification to facilitate the ownercoherent? ship of the development process in Africa. It is not about blaming the colonial masters; it is about blaming According to John Mahama , regional integration is the effects of some of the practices as they are seen the reason they raised the red flag on EPA. ECOWAS today. It cannot afford to be ignored. Her idea of cois one of the oldest sub-regional economic partnerships, herence is that Europe needs to help Africa. Not in which includes signed protocols on free movement of terms of aid, but as an obligation derived from its people and goods within the region. So far the protopolitical history. The world is now a global village. cols signed have not been achieved. But the region is Europe cannot afford to ignore what is going on in making an effort to adhere to these protocols and Africa, because it will affect Europe. It is a shared implement them. The basic problem remains a fallout responsibility. Partnership means helping Africa in its from colonial times. There exists in West Africa the development and at least remove the stumbling blocks particular problem with former French and English in its way. colonies. France has maintained a very strong relationship with its former colonies, while Britain has John Mahama comments that colonialism was a tranot. These Francophone countries integrated their gedy, but instead of being stuck in the past and blaming economies better in terms of adopting a single monecolonialism, Africa should rather look at the time tary zone, setting up a single central bank and harsince colonialism and what it has done with that time, monising their customs duties and tariffs. Now they there have been coup d’états and despicable presidents are trying to bring Anglophone and Francophone of that time, like e.g. Mobutu. The West can be blamed countries together to create a more competitive subfor its role during the cold war where it propped up region, creating single monetary and customs union. such brutal dictators in Africa to prevent the spread First the English speaking countries are trying to set of communism. These dictators trampled on human up a single monetary union, which will eventually be rights and looted their countries’ coffers dry. Other 45 merged with the Francophone monetary union to create colonies which gained independence at the same time a single currency for West Africa. These processes are as most African countries, such as Malaysia, have done not easy for many reasons. But while they try to much better. Africa must come out of the blame game strengthen integration in the subregion, they are conand instead look at the opportunities it has. fronted with signing another agreement with Europe. Trade among African countries is 11%, which is rather Michael Hofmann replies that he does believe that low. The first target is to increase trade within the region; European history gives European reason to be involved these issues have to be balanced out. Another issue is in Africa. Personally he feels a deep commitment to Chinese investment. In one single year trade with China ensure that Europe contributes to Africa’s development. increased by 40%. They do not bother with human rights But his readiness for self flagellation is also rather and spend a lot of money in infrastructure. limited. It is important that Africans clearly articulate their wishes, but should not stress the bad conscience To be developmental, EPAs have to be a win-win situatoo much. Guilt may generate charity, but not partnertion, that is why it is called a partnership. That involves ship. Partnership means meeting eye to eye, expressing having a clearly defined transition period and review positions and negotiating results. Bad conscience may mechanism, so that the red flag can be raised if carry development aid policy, but certainly not the problems occur. They need sufficient reassurance, that economy. Europe needs to make sure that economic in going forward no one will lose out. actors see the potential Africa has – Europe is at the point where they can do business together and create What is Europe’s responsibility towards Africa? growth and employment. FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? How can Africa move towards expanding its exports see opportunities in their partnership with the EU. of processed goods? Partnership within the WTO framework is very important for Africa, as this could give certainty and Komlan (Togo) recalls the title of the conference and predictability to the agreements reached. The EPAs would like to know what follows after the‘Final Medo not mean just market access like what African ters’? Furthermore, he would like to know whether countries expect to get out of bilateral trade negotiations the European countries are ready to construct comwith China, because EPAs go beyond that by including panies in Africa so that products can be manufactured/ development aspects. It is a package. If market access, processed there? Michael Hofmann replies that he is combined with development assistance in the form of certainly not opposed to building factories, but the the development matrix proposed by ESA states, could work of development policy is to create the basic parabe given, the ACP would achieve what they earnestly meters so that other people willing to construct comseek. If the infrastructure problems were addressed, panies are able to do so. But it is true that they have they would be able to address the issue of market access. a personal interest in finding these investors. GermaIt is, therefore, common for their countries to seek ny has an interest that other countries are developed. market access only to realise the capacity to satisfy it After all it is the world’s leading export nation. is lacking. This was the experience for a number of ACP countries under the Lomé Convention. Victor Ogalo (CUTS) would like to congratulate Germany on being the world’s leading export nation. As According to Samuel Amehou , the dialogue has to be he knows it is also the world’s largest exporter of intensified at this point of the discussions. Conferences coffee and he is greatly looking forward to visiting the like today’s show exactly the importance of doing this. German coffee plantations. In fact, Germany also Africa has learnt something about the incoherencies happens to be the biggest importer of Kenyan coffee that they have to overcome in order to go forward. beans. He would like to know how the EPA would The partnership has to be out of the WTO. The trade support Kenya to export finished coffee to Germany within the regions has to increase. To get that, the ACP PANEL 2 and not just the beans? states need the assistance of the EU to add value to their products. The countries want to transform their Are the different EU partnership policies coherent? own commodities. Concerning the supply of services, it is the same: the capacities are there. Together they Davina Makhan wants to know how the joint EU-AU will find the intelligence to continue. strategy fits into other existing agreements, such as 46 Euromed, TDCA etc.? John Mahama resumes by saying that he is an optimist. In Ghana he has seen what good private investment According to Michael Hofmann , the new European can do, it developed the Ghanaian telecom sector for partnership policies are something new, hence so far example, which has seen a growth explosion. Many no one can really say how it is going to work out, because Ghanaians living in the Diaspora were able to see the in the past they had individual programmes. It is still opportunities back in their own country. Most successvery complex and in many ways incoherent, different ful communications companies in the internet and IT instruments are under the control of different European networks are Ghanaian joint ventures with Europeans bodies. Africans should learn from the experiences of and Americans. He believes that these successes can other EU Partners, but it is also important that the Afribe replicated in other sectors, if they create the right can countries discuss best practices among themselves. environment of good economic policy and good governance. Create an environment to increase the private How relevant are agreements like EPA in the context sector and separate trade from politics. In the first of the dynamic trade between Africa and China, which place, indigenous African businesses should be enhas no agreements? couraged and supported. What happens after signing the EPAs? A realistic scenario should be created and Raymond Agaba still believes in the relevance of the civil society groups and the African public should be EPAs. The EU is still one of the biggest markets for educated on the implications. Once a realistic scenario Africa. Africa is willing to go into EPA, because they is created and understood, it will dispel the fears. FRIEDRICH-EBERT-STIFTUNG

CONCLUSION THE FINAL METERS AND BEYOND? Conclusion The discussions clearly demonstrated that opinions made clear that the EDF would not be suitable for this still differ on some of the core issues of the proposed purpose, primarily due to its well known limitations EPA. Thus much remains to be done before both of access. Instead, additional financing in the form of parties reach an agreement. But it also transpired regional adjustment/stabilisation funds was suggested. that the African and European negotiators’ position German representatives were, however, cautious to appear to have approximated in the past months, note that we cannot yet define the scope of the EPApossibly moving towards a compromise, to ensure related adjustment costs. Before the size of such adcontinued access of ACP producers to the European ditional financial assistance could be defined, the real markets, beyond the 2008 deadline. needs occurring needed to be assessed, taking into account the dynamic gains of liberalisation and the Given that the European side is unwilling to negotiate achievements in changing the public income base. a new exemption at the WTO, this would take the form of an“EPA light”, a WTO compatible agreement The“Singapore Issues” remain one of the most conon continued preferential access for goods only, that troversial issues. To some they are an integral part of would leave more contentious issues, such as the the development dimension of EPA, to others they are inclusion of competition, government procurement, the exact opposite. While their inclusion could foster etc. to further negotiations. Throughout the confea transparent and reliable regulatory environment, rence this was discussed as a fallback position, thought to be conducive to investment, there are fears however it was also acknowledged that this would that the regulatory capacity of governments will be imply that the EPA fell short of their ambition of constricted too severely by their inclusion. If they are becoming a combined trade and development into be included, it was agreed, that they should primstrument. arily address the regional level, i.e. opening government procurement up towards other members of the region, In the course of the discussion, various areas were but not the EU. However, it was disputed whether in identified in which the negotiations offered oppororder to achieve this, such regulation should be first tunities to the African countries, which have not yet agreed upon intra regionally and then brought into been fully seized. Thus the African countries should the agreement with the EU or whether it could be 47 use the negotiation process to push for concessions directly negotiated with the EU. from the EU in areas such as rules of origin, subsidies and enhanced market access for goods, services Certainly, regional integration remains a shared key and natural persons. aim of the EPAs. Whether the EPAs, as currently negotiated, support or subvert African regional integration No matter which form it will take, it was generally processes was however disputed. agreed that a sufficient transition period was another important element of a development-friendly design Finally, participation was identified as a neglected key of an EPA. A long delay itself will, however, not be element of the EPA negotiations. While the implemensufficient to ensure this. It needs to be complemented tation of an EPA will affect broad sections of society, by a careful monitoring of the effects of implementing participation remains weak. Key actors like subsistence EPAs. Some even suggested that the transition should farmers, NGOs, the private sector and parliamentarians be driven by benchmarks rather than a preset time– to name just some – need to be more actively inline. volved. Seen as crucial to the development-friendliness of an EPA and as a further issue where discussions seem to be progressing is the question of compensation for adjustment costs. The African experts We hope that with our conference and the continued cooperation with our partners in Africa and Europe we can contribute to such dialogue and participation. FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? List of Abbreviations ACP African, Caribbean and Pacific countries AfT Aid for Trade ATF Agricultural Trade Forum BMZ Bundesministerium für wirtschaftliche Zusammenarbeit (Federal Ministry of Economic Cooperation) CAP Common Agricultural Policy CEMAC Communauté Economique et Monétaire de l’Afrique Centrale (Central African Economic and Monetary Union) COMESA Common Market for Eastern and Southern Africa CSO Civil Society Organisation CSTT Conféderation syndicale des travailleurs du Togo (trade union confederation of workers in Togo) LIST OF ABBREVIATIONS CUTS-NRC Consumer Unity and Trust Society, Nairobi Resource Center DFQF Duty-Free Quota-Free DG Trade Directorate General Trade EAC East African Community EALA East African Legislative Assembly EAPLC East African Parliamentary Liaison Committee on Trade EBA Everything But Arms initiative ECDPM European Centre for Development Policy Management ECOWAS Economic Community of West African States EDF European Development Fund EPA Economic Partnership Agreement ESA East and Southern Africa ETUC European Trade Union Confederation 48 EU European Union FES Friedrich-Ebert-Stiftung FTA Free Trade Agreement GATS General Agreement on Trade in Services GSP Generalised System of Preferences HS Harmonised System ICFTU International Confederation of Free Trade Unions ILO International Labour Organisation LDC Least Developed Country MDG Millennium Development Goals MFN Most Favoured Nation NGO Non-Governmental Organisation NLC Nigeria Labour Congress PRSP Poverty Reduction Strategy Paper REC Regional Economic Community SADC Southern African Development Community TDCA Trade, Development and Cooperation Agreement WCL World Confederation of Labour WTO World Trade Organization FRIEDRICH-EBERT-STIFTUNG

SPEAKERS THE FINAL METERS AND BEYOND? Speakers Abdirahim Abdi was elected a member of the East African Legislative Assembly(EALA) in 2001, a Regional Parliament comprising Kenya, Tanzania and Uganda. Since 1996, he is also Managing Director of ABHA Limited, a supplier of agricultural inputs for the tea industry. From 1992 until 1996 he was Managing Director of Haithar Holdings, a transport and logistics provider in the East African region. Mr. Abdi has a Bachelor of Sciences in Business Administration(Finance) from the American University in Washington D.C. Evita Schmieg is head of the Globalisation, Trade and Investment Division in the Federal Ministry for Economic Co-operation and Development(BMZ). She is an economist by profession with several years of experience in the area of trade, globalisation and development in the Ministry as well as in the Commission of the European Communities in Brussels. On a previous post she prepared a conflict prevention strategy for German development cooperation. Gervais Nkanagu is Head of COMESA Liaison Office Brussels and member of the Negotiating Team of AfOA since February 2006. From Mai 2004 until January 2006 he was President of the National Development and Political Forum in Burundi and member of the ETPR. From 2002 until January 2006 he was Consultant Trainer at OIF, OMC and CCI. He is founding member of INNOV AFRICA Management. From July 2001 until January 2006 he was President of the Steering Committee of the“Cadre Intégré” in Burundi. From 2000 until January 2006 he was President of the Administrative Board of the University Lac Tanganyika(ULT) and founding member of the same. From 1999 until January 2006 he was with COMESA, WTO and International Trade Center in Burundi. From 1998 until January 2006 he was Director General of Trade at the Ministry for Trade and Industry in Burundi. Since 1997 he is Professor at the University of Burundi and Rwanda, faculty of Economics and Management 49 Sciences. He received a Doctorate in Management Sciences at the University Lumière de Lyon in October 1996. John Mahama is member of Parliament of Ghana since 1996. He is currently the Minority Spokesman on Foreign Affairs in the Ghana Parliament, a member of the Pan-African Parliament(Vice Chairman of the West African Caucus), the UNDP Advisory Committee and of the Communications, Foreign Affairs, Standing Orders and Appointment Committees of Parliament of Ghana. He served as Information Officer at the Embassy of Japan in Accra, then joined PLAN International Ghana as Sponsorship and Grants Manager. As Minister he served as Chairman of the National Communications Authority(NCA). He has a degree in history from the University of Ghana and in Social Psychology from the Institute of Social Sciences in Moscow. He has attended numerous conferences, won many fellowships including study at the Johns Hopkins University, Baltimore, USA, and is also a Gates Fellow. FRIEDRICH-EBERT-STIFTUNG

THE FINAL METERS AND BEYOND? Martin Dihm is Deputy Head of Unit in the Directorate General for Trade of the European Commission. He deals with bilateral trade relations and the negotiations of Economic Partnership Agreements(EPA) with the African, Caribbean and Pacific countries(ACP), with WTO related aspects of EPA and coherence between trade and development cooperation. Martin Dihm studied agricultural economics at the University of Göttingen with specialisation on trade and development. Before joining the European Commission he worked for the Food and Agricultural Organisation and World Food Council in Rome. His professional experience within the European Commission comprises work as an official with the Directorate General for Development and assignments with two EC Delegations(Caribbean/ Barbados and West Africa/ Nigeria) as economic adviser for issues relating to trade and regional integration. Michael Hofmann is Head of the Department for global and sectoral tasks; European and multilateral development policy; Africa; Middle East within the Federal Ministry for Economic Cooperation and Development(BMZ) since 1999. Prior thereto, he was, inter alia, the Head of the International Department at the SPD and adviser to Willy Brandt(former Chancellor). He has a diploma in Political Sciences, Economics, Latin American Studies and Journalism and a doctorate in Economics and Social Sciences from the Freie Universität Berlin. SPEAKERS Raymond Agaba is Trade Economist and currently working in the Ministry of Tourism, Trade and Industry in Kampala. He is desk officer for negotiations of the EPAs and involved in consultations of stakeholders at national level in the framework of the Inter-Institutional Trade Committee(IITC). He prepares and discusses position papers on EPAs and is participant in panel discussion at the National and Regional Negotiation Forum(ESA, RNF). He has a Bachelor of Arts from the Makerere University Kampala and a Masters of Business in International Trade from Victoria University, Melbourne. Samuel Amehou is a Diplomat and Initiator and Coordinator of the sectoral initiative in 50 favour of cotton within the WTO, Coordinator of the LDCs at the UN in Geneva, Special Ambassador and Plenipotentiary for the Republic of Benin of the Swiss, Austrian, Hungarian, Slovenian, Croatian and Bulgarian Confederation, Ambassador and Permanent Representative of Benin at the United Nations Office, at the WTO and other international organisations with offices in Geneva. He has a diploma from the Centre de Formation Administrative de Perfectionnement(CEFAP) in Benin and a Master’s Degree from the University of Saarbrücken. Tidiane Wade is Trade Consultant and Head of the Department of International Trade Negotiations at the Ministry of Trade and Consumption in Senegal. He has, inter alia, a diploma from the Ecole Nationale d’Administration, Senegal, from the United Nations Institute of Research and Development and from the Trade Policy Course of the GATT. FRIEDRICH-EBERT-STIFTUNG

INVITATION PROGRAMME THE FINAL METERS AND BEYOND? International Conference ”The Final Meters and Beyond?“ the Economic Partnership The Conclusion of s and a tion Agreement (EPA) Negotia tation? ment Oriented Implemen Develop 28. March 2007 in Berlin “The Final Meters and Beyond?” Registration and Organisation: The Conclusion of the Economic Partnership Agreement(EPA) Negotiations and a Development Oriented Implementation? The negotiations of WTO compatible bilateral free trade agreements(EPA) between the EU and the group of African, Caribbean and Pacific(ACP) countries are to be concluded by the end of 2007. The overarching aim of the EPA is the promotion of development. The reciprocal market opening and the accompanying measures of the EPA are intended to advance regional integration, the ACP countries’ integration into the world economy and their economic growth and to make a contribution to sustainable development and poverty reduction within the ACP countries. The EPA negotiations are in a critical phase during Germany’s EU Presidency in the first half of 2007. But the EU and the African countries still appear far from reaching a sustainable consensus. Especially the development dimension and contribution to poverty reduction of the free trade agreement are frequently questioned. With the deadline for the negotiations approaching fast, it is now also time to take a look at what will happen after their conclusion. If the deadline of the end of 2007 is met, African countries as well as the EU will have a host of challenges to face as of next year. The conference will allow German, European and African politicians to discuss the implications of an agreement, the resulting challenges that will present themselves to both sides and to express recommendations to the EU Presidency. Because: reforms will be necessary on behalf of the ACP as well as the EU. The Friedrich-Ebert-Stiftung cordially invites you to participate in this discussion. Kindly register by the 23 rd of March 2007. Wednesday, 28 March 2007 A closed experts meeting will be taking place in the morning, allowing discussion between European and African experts on the EPA. The results of the meeting will be available during the conference in the afternoon and later published in the conference documentation. 2.00 pm Welcome Address Werner Puschra Friedrich-Ebert-Stiftung Public discussion After the Conclusion of the Negotiations: Implementation of the EPA – Political Preconditions and Challenges What will be the consequences of the conclusion of negotiations? Which challenges arise, for the African as well as for the European countries? The African countries have to prepare for a market opening towards the EU, the public income base in many countries has to be restructured. How can this be achieved? What shape will the developmental structural transformations processes take, that are to be promoted by the EPA. Which support can the EU offer and which reforms will be necessary within Europe? Participants: Evita Schmieg Ministry of Economic Cooperation and Development, Berlin NN DG Trade, European Commission Tidian Wade Trade Ministry, Dakar Gervais Nkanagu Common Market for Eastern and Southern Africa, Brussels Abdirahim Abdi East African Legislative Assembly, Nairobi Moderator: Bernd Ludermann, free lance journalist, Essen P R O G R A M ME 4.30 pm Coffee Break 6.00 pm Public discussion A Coherent Development and Trade Policy? The EPA will shape the(trade-)relations between the EU and the African countries. The EU is frequently accused of lacking coherence, especially in its development policy. Can the EPA successfully span trade and development policy and contribute to the achievement of the aims of German policy towards Africa? Do they form a coherent part of the German and the European trade and development policy? Participants: Michael Hofmann Ministry of Economic Cooperation and Development, Berlin NN Lisbon(tbc) Samuel Amehou ACP African, Caribbean and Pacific Group of States, Geneva John Mahama Member of Parliament, Accra Raymond Agaba Ministry of Trade, Kampala Moderator: Stefan Mair, German Institute for International and Security Affair, Berlin 8.00 pm End of conference, reception at the Friedrich-Ebert-Stiftung FRIEDRICH-EBERT-STIFTUNG 51