Nov 14, 1987.
HURDLES TO ACP/EEC TRADE IDENTIFIED.
HARARE NOVEMBER 12 (IPS/GODFREY KARORO) –As trade and economic operators knock heads to try and stimulate trade among the African, Caribbean and Pacific (ACP), delegates attending the ACP/European Economic Community (EEC) trade operators’ conference here are agreed that intra-ACP trade is largely untapped.
Increased intra-ACP trade could also be an opportunity for member countries to break out of the fixed and traditional channels of trade and economic relations with the EEC.
Most of the 66 member countries of the ACP were at one time or another under colonial rule, which established two-way trade routes between the colonial power and their territories.
Statistics of the UN Conference on Trade and Development (UNCTAD) paint an optimistic picture of the potential trade between the developed and developing countries and among the ACP countries themselves.
South-south trade increased from only 2.5 percent of world trade in the early 1970’s to the present nine percent per annum.
The figures also show that south-south trade proved resilient as trade between the developing countries and their counterparts in the north declined by 20 percent between 1981 and 1983 due to the world economic recession.
During this period, south-south trade declined by only 10 percent.
ACP member countries wish to establish a strong dialogue between the trade and economic operators of their region and their colleagues in the North, the chairman of the ACP Conference of National Chambers of Commerce told IPS.
"People want things to happen and move to pre-empt action-oriented resolutions", F.N. Macharia said.
Macharia said his organisation was concerned about several issues which hinder ACP-EEC and intra-ACP trade.
These include commodity prices, exchange rates, south-south trade development, the debt crisis and the role of private sector in development.
"We want to see clear, definite, resolutions directed at our respective governments", Macharia said. "If these are there, we can see things moving quicker than hitherto", he added.
The ACP chairman said his organisation had impressed upon the EEC that, while commodity prices of many products such as coffee, cocoa, copper had declined, the cost of inputs –chemicals, machinery, fertiliser and fuel – had increased "tremendously".
Macharia said the situation was aggravated by the exchange rates, which were advantageous to the developed nations.
He gave the example of the Kenyan shilling, which a few years ago was valued at five shillings to one U.S. dollar. Now it is 17 shillings to one U.S. dollar.
"By the time the developing countries start paying back their loans, the rate would be in favour of developed countries which has resulted in the debt crisis", Macharia asserted.
ACP-EEC trade and intra-ACP trade is also hindered by outdated statistics and information on south-south trade.
Macharia said that ACP governments should facilitate the flow of information and he disclosed that the ACP would establish an information centre to help alert member countries to trade opportunities.
To facilitate increases south-south trade, British economist James McLeod called for a reduction in tariff and non-tariff barriers.
While the EEC grants tariff-free access for the vast majority of imports from developing countries, the majority of ACP countries levy tariffs.
ACP trade operators are also of the opinion that regional co-operation should be encouraged to influence trade promotion.
Ten major regional trade and economic groupings have been established around the globe.
"Such bodies have already taken positive steps to encourage regional trade, which in turn will help to lay the path for inter-regional trade"; McLeod told the four-day conference.
Zimbabwe’s Trade and Commerce Minister strongly urged EEC countries to refrain from using protectionist measures against products and commodities from ACP members.
"It is still something of a disappointment that while the EEC undertook to refrain from using protectionist measures against products and commodities from the ACP, this has not been observed", the Minister complained at the Conference.
Macharia also noted the EEC countries acknowledged that this resulted in the decline in international trade and a loss in agricultural and commodity markets.
But the potential for south-south trade "will only be realised if the governments and the private sector of the ACP work with the international community at large to pool their knowledge and aspirations", he added.