Building capacity to help Africa trade better

What does the present EPA debate say about integration and economic development in Africa?


What does the present EPA debate say about integration and economic development in Africa?

Gerhard Erasmus, tralac Associate, comments on the Economic Partnership Agreement (EPA) negotiations

There is a new debate among African governments about whether to conclude Economic Partnership Agreements with the EU. The views range from the negative impact which the EPAs might have on local development and industrialization plans to concerns over technical aspects such as export taxes, agricultural safeguards and regional integration. Political issues (e.g. the promotion of good governance and human rights) also figure at times. And there are different views and needs. The October deadline set for duty free/ quota free access for African goods into the EU’s markets has made decisions about the EPAs more urgent, resulting in high level debates in e.g. the African Union (AU).

What do these arguments tell us about policy making in Africa and the adoption of economic development strategies? Do we witness policy shifts and novel approaches for debating these issues? Are there new opportunities for Africa to pursue regional and global integration and industrial development? Are African nations and their Regional Economic Communities (RECs) more united or do they increasingly recognise the dictates of national priorities? What are the implications of these debates and differences for concluding the Continental Free Trade Agreement (CFTA); the negotiations of which are scheduled to start in 2015?

The global and local political context has changed quite drastically since the EPA negotiations started more than ten years ago. This is reflected in several of the arguments now raised. The “Africa rising” perception provides a new impetus and confidence in many circles. It inspires the resolve to conclude the CFTA but does not suggest self evident solutions.

China has become a major African trading partner. It is refining its involvement in the continent towards that of a special partner for infrastructural development. The Doha Round has lost its allure and there are even concerns now about what was agreed to in Bali.

Within Africa the role of “hegemons” (with the number one voice now coming from Lagos) has introduced a novel element. They will play essential roles in how trade arrangements are negotiated and implemented. In the context of industrial development it is not clear at all how national demands will be translated into regional supply chain benefits and opportunities.

The CFTA negotiations will be tasked with generating new answers and approaches. It is aimed at a continental plan for how Africa will do business with itself. It may find that the traditional linear model for pursuing regional integration is outdated when measured against the very arguments now raised in Africa’s own debates. What are the real bottlenecks? Trade facilitation and infrastructural needs are major issues.

The CFTA faces a cluster of new challenges. It will have to provide realistic and suitable solutions for contemporary problems. Existing regional configurations should not be written off; they may gain in importance as destinations for locally produced goods and services. It seems unlikely that dramatic shifts towards new intra African markets are on the cards for all. The first priority (e.g. in SADC) might be to consolidate the FTAs already agreed to. Will the CFTA negotiations tackle this particular challenge too as part of accommodating the AU sentiment to use the RECs as building blocks for Africa’s further integration?

The relationship between national development plans and the demands for certainty in new trade arrangements introduces political difficulties. They come at a time when many governments invoke their sovereignty as the basis for unilateral action. African governments increasingly behave rather typically and pursue national priorities. They are discovering that the implementation of legal obligations flowing from REC agreements is a complicated matter. Rules-based integration is inevitable. It becomes increasingly obvious that “solidarity” will not prevent the consequence to respect obligations freely entered into. Neither will sovereignty do so. Trade negotiations are about national offensive and defensive interests; even if pursued in the context of African solidarity.



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