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EPA will open poor countries to European pirates – report
Accra, April 23, Ghanadot/GNA – The
Economic Partnership Agreement (EPA) due to be signed
between the European Union (EU) and 110 developing countries
this year would open up those countries to European pirates
and ultimately increase poverty for less developed countries
(LDCs), a new report on the EPA said on Wednesday.
“We are not against trade but we are against the type of
rules that the EU imposes on us and that is why we say ‘no’
to European pirates,” the report quoted Ms Norma Maldonado
from the Central American-based International Gender and
Trade Network (IGTN) as saying.
The report put together by the World Trade Movement (WTM)
under the title “Raw Deal”, and launched at the ongoing
United Nations Conference on Trade and Development (UNCTAD
XII) meeting in Accra, noted that the benefits of signing a
free trade deal with the EU sat firmly with European
businesses, rather the developing countries.
Through the EPA, the EU is seeking to open up the markets of
110 African-Caribbean-Pacific (ACP), Latin American, Asian
and Mediterranean countries for free trade in spite of the
fact that all of those countries do not have strong enough
economies to compete fairly with the EU.
Critics maintain that the fact that the EU provided heavy
subsidies for its local farmers and multinationals,
something that developing countries were being asked not to
do, made the playing ground uneven.
The WTM through the report has therefore added its voice to
the widespread call for the EPA to be rejected outright.
Meanwhile other organizations, including UK-based
international charity, Oxfam, have said that a better deal
would be to include some amount of development content in
the EPA for less developed countries and for the EU to open
up its markets for least developed countries (LDCs) now.
The report captured the development impacts of two existing
EU bilateral trade agreements with South Africa and Mexico,
saying that in both examples the deals were found to be
one-sided in favour of the EU.
The impacts highlighted by the report included balance of
payment problems, decreased tax revenue, decreased access to
credit for farmers, decreased ability to effectively
regulate foreign investors and increased unemployment in
those two countries.
“An almost 50 per cent increase in South African food and
drink imports from the EU, including diary products,
cereals, and processed food and drink, coupled with the
reduction of tariffs on European sweets in South Africa has
resulted in 25 per cent fall in employment in the sweet
making industry in that country.”
It said South Africa’s growing trade deficit with the EU had
made that country more vulnerable to international debt,
particularly destabilizing short-term capital flow.
In the case of Mexico, the report said that country could no
longer regulate the proportion of foreign shareholders in
banks.
“Mexico can no longer favour domestic companies for
government procurement contracts, which amounts to six per
cent of GDP, even though UNCTAD has said that favouring
domestic companies is a vital tool of development,” it said.
It also projected government revenue loss to the tune of 7.5
per cent of GDP in Namibia.
Meanwhile Ghana and Cote d’Ivoire, who have already
initialled an Interim EPA, are expected to lose at least 83
million dollars a year in import tariffs on goods from EU.
Ms Maldonado said the EU wanted to impose things on LDCs
which they (EU) did not impose on themselves, such as
demanding access to LDCs, even though they had huge
subsidies on their own agricultural goods.
Ms. Vicky Cann, Trade Policy Officer of WTM, said EU trade
deals were unfair and hurt the poor, adding that the
evidence was that the EPA would benefit European
multinationals and hinder rather than help the development
of poor countries.
“In this time of rocketing world food prices, it is hard to
believe that Europe seeks to open up developing countries’
markets to heavily subsidized European exports, putting LDCs
farmers out of business and undermining food security,” she
said.
Charles Santiago, MP for the Democratic Action Party in
Malaysia, described the EPA as a re-write of trade rules in
favour of EU corporations, following the thwarting of EU’s
plans at the World Trade Organization (WTO) by LDCs.
“EU is now targeting LDCs individually to reap the rewards
it couldn’t get at the WTO because countries stood up and
said ‘no’ together. To developing countries I say keep away
from EU free trade agreements, they do not work in your
interest,” he said.
Mr. John Ochola from Econews in Kenya called on European
citizens and companies to stand up to their governments and
tell them not to make the poor poorer.
Meanwhile 25 individual LDCs, including Ghana, have already
initialled an Interim EPA, under which a number of exports
between them and EU were under a quota-free, duty free
regime, pending the signing of the full EPA this year.
Critics have said if the EPA is signed, people in the 110
targeted countries, 1.47 billion of which lived on less than
a dollar a day, stood the risk of even further sinking under
the doldrums of poverty.
GNA
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