tralac not only hosted its 5th Annual Conference but also celebrated 5 years of developing and building trade capacity in the region. Our flagship event was hosted at the BMW pavilion at the V&A Waterfront in Cape Town.

The negotiations to conclude Economic Partnership Agreements (EPAs) are entering a critical stage and many issues remain unresolved. The SADC EPA is unique in several respects which makes the successful outcome of negotiations in this region even more challenging. There is still no agreement on the treatment of new generation trade issues and the inclusion of South Africa is posing fundamental questions around market access and integration.

The EPA negotiation process should be considered against the backdrop of the emerging productive regional integration debate in southern and eastern Africa. It is important that the SADC EPA support and build on existing regional integration initiatives; but is this really the case? The outcome of this EPA should ultimately promote the development objectives as stated in the Cotonou Agreement and yet, there is still no agreement on what development actually implies. The EU prefers to link development to the outcome of the negotiations. To put this in perspective, the relationship between trade and development must be considered. Does causality run from trade to development or is this the other way round? At tralac’s Annual Conference participants endeavoured to contribute to these debates and even came up with innovative solutions to some of the challenges facing the region in the current negotiations.

At the 2006 tralac Conference the key focus was WTO compatibility and related legal issues, with specific relevance for the SADC EPA Group. The debate at the Conference lead to a regional workshop at which these issues were further clarified, and emphasised the implications of WTO compatibility for FTAs.

The 2007 Annual Conference focused on the following four themes:

1. The lack of agreement on the scope of the SADC-EU EPA

The EU’s aim is to negotiate a broad EPA which includes new generation issues (services, investment, competition policy, government procurement, trade facilitation) , while an official SADC EPA Group position supports a narrowly-focused Trade in Goods EPA. Important question in this regard include:

• What are the implications of a narrowly focused Trade in Goods EPA (keeping in mind preference erosion)?

• Is there an efficiency and competitiveness compromise associated with exclusion of services and other new generation issues?

2. Implications for Regional Integration

The EPA process should also be seen in the context of the regional integration debate in east and southern Africa. At this stage there is no coherent regional integration strategy with clear focus on key imperatives such as common policy, legal and institutional development.

The African Integration Paradigm requires a new approach – a significant governance gap has emerged as market-led integration streaks ahead and legal and institutional development (including the implementation of agreements, protocols and treaties) has stagnated. What are the implications of the EPA negotiations for this debate and the regional integration process?

3. Global Integration

An objective of the EPAs is to promote the global integration of ACP countries. Successful global integration is fundamentally a question of competitiveness. To what extent can EPAs assist countries in east and southern Africa to enhance their competitiveness? Would, for example, the inclusion of services and other new generation issues enhance the competitiveness of business in the region?

What has been the experience of African countries to integrate into the global economy and what are the constraints that they face in this regard? How do we engage with these issues and what are the implications of emerging global powers such as China, for Africa?

4. Development

In the final analysis, our concern in the region is development. The ‘trade and development’ and ‘aid for trade’ debates are growing in the region. In the context of the EPA negotiations there is no agreement on what development means. The EU links development to the inclusions of new issues, while in the region development is largely about the availability of more development assistance and capacity building. It is also recognised that infrastructural constraints are important. This regional perspective presents arguably a very traditional approach to the development discussion, to a large extent ignoring the importance of regulatory reform (including common policy, legal and institutional development) in development.