June 19, 2009 15:33:51 PM
Posted By administrator
from: http://allafrica.com/stories/ printable/200906190620.html 19 June 2009 Can you imagine what will happen in a football match in which the almighty Brazil is allowed to field eleven of its world renowned players while the opposing side fields only a player? It sounds utterly absurd, doesn't it?
Simplistic as this analogy might seem, it does hold a lot when one takes a critical look at the Economic Partnership Agreements (EPAs) being negotiated between the European Union (EU) and 75 African, Caribbean and Pacific (ACP) countries. The EPAs are aimed at fostering free trade between the two sides. This means for instance that there would be substantial elimination of tariff and non-tariff barriers within the free trade area created under each of the EPAs.
The analogy holds even firmer when the EU as a group of 25 mainly highly industrialized countries, enters the agreement not with say ECOWAS as a group but with individual countries within the sub-region.
As students of the Adam Smith school of thought, the Europeans believe that free trade maximizes social welfare. But social welfare for whom? What if the trade in question is lopsided in nature; such that one of the parties to the trade has far more potential than the other? What if one party which is asking for free market access has a far stronger industrial, financial and other economic base? What if that same party is the number one subsidizer of its agricultural sector in the world? "The EU is the world's largest subsidizer of agriculture and thus causes the greatest harm to the livelihoods of the world's poorest people in developing countries," (Faizel Ismail, 2007).
On the other hand, African economies remain largely underdeveloped while at the same time African governments are being advised by their development partners not to subsidize their already famished agricultural sector.
And then as usual, African countries have refused to come together to negotiate the EPAs as a group. Deadlines have been missed and the June 2009 deadline is about missed and it is still not clear whether a deal would be reached between ECOWAS and the EU any time soon. In the meantime, Ghana, seeing that other ECOWAS countries including Nigeria are dragging their feet, has gone ahead like Ivory Coast, to "initial" an Interim Economic Partnership Agreement (IEPA) with the EU. Indeed, it is said that the document presented to Ghana was nothing but a translated copy of what the EU presented to the Ivory Coast. Those who think it was not a big deal say the same rules apply in international trade. But Mr. Tetteh Hormeku of the Third World Network (TWN) would always argue that Ghana could have negotiated on its own terms for a better deal. It was indeed, in a hasty manner that Ghana, in December 2008 went ahead to "initial" the IEPAs. A source says that not only did "our development partners" keep reminding Ghana's negotiating team that they were the number one benefactors of the country in terms of loans and grants, but that they actually used a certain $65 million grant facility as a bargaining chip.
What is interesting is that while ECOWAS is telling the EU it cannot liberalise beyond 65%, Ghana has agreed in the IEPA to eliminate tariffs on 80% of its imports from the EU over a 12 year period. "If this is the case (Patel, 2007), Ghanaians might benefit from access to cheaper (imported) goods, but this potential gain must also be seen in the context of the impact on production and Ghana's broader long-term national development. ... for more, kindly go to the source