chapter  4
19 Pages

The development dimension or disillusion? The EU’s development policy goals and the Economic Partnership Agreements

ByMARIKKI STOCCHETTI

This quotation refers in particular to the non-reciprocal market access arrangements which have proved inadequate to reverse the declining share of ACP countries’ exports in the European market. Second, and perhaps more acutely for the EU, the current trade preferences are inconsistent with the prevailing international trade rules as defined by the World Trade Organisation (WTO) and therefore need to be changed. The fact that the non-reciprocity aspect of the CPA is not in line with the WTO’s so-called ‘Enabling Clause’ is considered particularly problematic.4 To ensure WTO compliance, the EPAs are to be regional free trade agreements that set out reciprocal liberalisation of ‘substantially all trade within reasonable length of time’ between the EU and ACP partner regions.5 In the context of EPAs this has come to be understood as roughly 80 per cent of trade that should be liberalised within 15 years (Bilal 2008: 1). There has been a WTO-granted waiver in place allowing EU-ACP unilateral Preferential Trade Agreements (PTAs) to exist, but this waiver expired at the end of 2007, which put strong pressure particularly on the ACP side (ODI 2007; Bilal and Rampa 2006). However, the EC sees no contradiction here. On the contrary, the EC considers it possible to tackle both the objectives of poverty reduction and trade liberalisation under the EPA free trade agreements. Moreover, the EC believes that ‘reforming’ the EU-ACP economic relations in line with WTO rules will also improve the EU’s contribution to the set development policy goals. In a sense, for the EC the proposed free trade EPAs are to play a double function in the governance of two possibly conflicting global policy processes – on the one hand, EPAs are to contribute to poverty reduction; and on the other hand, they are to reinforce WTO-led economic governance (see Ba and Hoffman 2005) in the area of international trade. At the same time, scepticism prevails on the ACP side. Critics of the EPA agreements agree on changing the EU-ACP economic relations, but for quite different reasons. The ACP countries, together with the European Parliament Committees on Development and International Trade, as well as various NGO platforms, perceive market access measures as inadequate to advance development in ACP countries and stress so-called supply-side constraints6 within the ACP states which make it unlikely that the majority of the ACP countries’ producers can benefit from the market access. Further, the critics point to the unequal trade rules, as well as to the high and distorting level of the EU’s own protectionism, which in their view hinders possibilities for development through trade in ACP countries. These critics fear, inter alia, that in the current international setting, allowing the EU increased access to the ACP markets by liberating ‘substantially all trade’ will have a negative impact on the development of local producers and industries as well as on public revenues of the ACP states. Therefore, the EU approach is more likely to lead to growing inequality than the achievement of joint development goals.7 The criticism of EPAs has been further reinforced by the failure of the WTO Doha Development Round, as well as the subsequent debate on the current international trade rules’ impact on development. However, while the multilateral

trade negotiations (MTN) have failed to meet every deadline set so far, the EU is aiming at further trade liberalisation through EPAs on a bilateral basis, even beyond the required WTO-compatibility.8 Although the text of the CPA records the EU and ACP parties’ agreement to conclude new WTO-compatible trading arrangements, progressively removing barriers to trade and enhancing cooperation in all areas relevant to trade and development,9 a mutually acceptable interpretation of this commitment was left to the actual negotiators to find. At the core of the disagreement has been the interrelationship between development objectives and the nature of the proposed EPA trade agreements. In this debate, the positions of the main parties – the EU (represented by the European Commission/DG Trade) and the ACP group – seem worlds apart. Yet, all the parties seem to indeed agree that EPAs are first and foremost about development and that the so-called ‘development dimension’ should be central to the future EU-ACP economic relations.10 However, the manner in which this ‘development dimension’ is conceptualised and how it relates to the objectives of poverty reduction and sustainable development has been a subject of an unparalleled debate. In this chapter, I will address the EPA debate from the point of view of discourses related to the ‘development dimension’. I claim that each party interprets development objectives and EPA negotiations according to its own discourse of ‘development dimension’. Or, more precisely, that distinctive types of discourse of EPA ‘development dimension’ defines: (a) the social context of the negotiations; (b) the object (the possible content of EPA agreements); and (c) the expected implications of EPA agreements on development. In line with Agnew’s and Corbridge’s definition (see Grainger 2004: 283-284), I regard these discourses as a historically, socially and institutionally specific structure of statements, terms, categories and beliefs on which parties constitute their positions. Finally, I have inferred these general discourses from the documents and statements of development and trade policies which guide the EPA negotiations. My contribution will focus on the EU statements regarding the interrelationship between the EU’s development and trade policy objectives that define the ‘development dimension’. In particular, I will discuss the way in which the EU legitimises its promotion of EPA free trade agreements both in the implementation of the CPA and the WTO rules. In order to do so, I will first look at the nature of the development policy goals as stated in the CPA. I will then discuss the EU’s commitments to these goals. Third, I will analyse the EU’s understanding of the interrelationship between these goals from the point of view of policy coherence as presented in the EU’s new trade agenda, ‘Global Europe’, and in the ‘European Consensus on Development’ policy statement, as well as in the Commission’s Communications on the UN Millennium Development Goals (MDGs). Fourth, I will map out the key elements on which the EU bases the development dimension in the position it takes on EPA negotiations. I will conclude with a short analysis of the EU conception of the development dimension with respect to the stated development policy goals.