chapter  5
14 Pages

EPAs and poverty alleviation: any link? The case of the ESA regional group


Africa’s ability to develop and makes her more vulnerable to global competition. African governments and producers are already crippled by capacity constraints that limit their ability to negotiate and compete with EU producers. Furthermore, the revenue forgone by the elimination of import duties would not only lead to severe cutbacks in public expenditure (e.g. for rural infrastructure, hospitals and schools), but also in employment for half a million people. Regarding investments, critics argue that the comprehensive market liberalisation foreseen by EPAs would remove the policy tools (and the policy space associated with these tools) that are typically used by governments to stimulate FDI inflows. Overall, the net effect of EPAs may be increased rather than decreased poverty! With the above arguments in mind, this chapter assesses whether and how EPAs can liberate the Eastern and Southern Africa (ESA) EPA configuration from the jaws of poverty, or continue to push it further and further into the abyss, taking Mauritius as a special case study. The chapter begins with an overview of the ESA group, followed by the poverty implications for the group as a whole. The next section provides an overview of the Mauritian case, with special emphasis on the impact of EPAs on protection, imports, custom revenue, employment and how these issues link with welfare effects. The chapter ends with a conclusion.