SUNS #4293 Friday 2 October 1998


DEVELOPMENT: NEGOTIATIONS OVER FUTURE ACP-EU RELATIONS START

Brussels, Oct 1 (IPS/Niccolo Sarno) -- Formal negotiations over the future of the Lome Convention, the European Union's giant trade and aid pact with the 71 countries of the African, Caribbean and
Pacific (ACP) group of nations, are finally under way.

European Union officials are suggesting substantial changes to the Convention, the world's largest trade and aid pact. It expires in February 2000 and must be revised to meet the World Trade
Organisation (WTO) global free trade rules.

Although the final EU negotiating directive, released ahead of the negotiations, which began Wednesday, asserts that the EU "will examine all alternative possibilities," European ministers are
backing the 'Free Trade Areas' (FTAs) option.

The FTAs, as envisaged by the EU, would link those ACP countries which have already achieved a certain level of development, and aim at establishing regional agreements between the EU and sub- regions of the ACP.

David Jessop, executive director of the Caribbean Council for Europe says that "for the ACP, the new arrangement must be about development and greater equity between sovereign states of
differing sizes and wealth." Adds Jessop, "unfortunately, it appears that for the EU, the negotiations seem to be about encouraging the ACP towards compatibility with World Trade Organisation rules and creating new political and economic conditionalities."

Under the EU proposal, access to the EU market would remain the same as now enjoyed under Lome, but the ACP states would be expected to match this by opening up their own markets to EU
exports, after a transitional period of 10 to 15 years which would start in 2004.

The EU proposal is to grant special agreements only to the Least Developed Countries (LDCs) and the small island states within the ACP, which have the most fragile economies.

Among the 71 ACP states, 39 are LDCs, which already benefit from zero-tariff access to EU market, and 20 are small island economies for which the EU hopes to set special rules.

Philip Lowe, director general for development at the European Commission, recently said the plan was to open the EU market, on a non-reciprocal basis, for all products coming from the ACP LDCs
which have not signed Regional Free Trade Agreements by 2004.

The proposed solution for the LDCs is the granting of 'enhanced' preferences, or completely tariff-free access to the European market, under the EU's existing Generalised System of Preferences
(GSP).

ACP countries acknowledge the need to be integrated and competitive in the world economy, but they are expected to propose "more realistic time scales" in respect of phasing out preferential trade
agreements.

The failure to reach an agreement in trade talks between the EU and South Africa, after the 22nd round of negotiations here this month, suggests that ACP-EU negotiations over FTAs may not be as quick as hoped by the EU's executive Commission, which will negotiate on behalf of the EU.

Glenys Kinnock, a member of the European Parliament, echoed this view by recently saying that "in the current hostile climate, it is unrealistic to believe that ACP countries will be able to prepare
and negotiate Free trade Agreements with the EU in five years."

For NGOs campaigning for poverty reduction, the overall emphasis on free trade is worrying. NGOs say that under a system of regional FTAs the advantage will lie with the EU's globalised exporters, not the ACP states, whose membership includes some of the poorest nations in the world.

"It (trade and investment) is an area over which there is considerable concern in ACP and European civil society about the EU's real intention," Simon Stocker, Director of Eurostep, a
network of European NGDOs, told the European Parliament Development Committee this week.

Stocker noted that IMF predictions for African economies are bleak. The IMF estimates say that exports from Africa, after a year of stagnation in 1997, will fall 2.7 percent this year. The IMF also
predicts a fall in Foreign Direct Investment over the same period from 10.3 billion dollars to 9.7 billion dollars.

European NGOs say that the timetable proposed by the EU could do "serious damage" to the economies of ACP states. Under the finalised FTAs, ACP countries would lose their present preferential access to EU markets and would be forced to open up to EU exports.

"The move of ACP countries towards regional integration can benefit from EU support, but it cannot be driven from outside" said the European Centre of Development Policy Management, an independent foundation based in Maastricht in the Netherlands, in a recent comment.

The Commission aims to finalise the first regional FTAs by 2015, starting with those groups of countries which have already begun a process of regional integration. Caribbean countries may form a FTA based on the existing CARICOM and CARIFORUM agreements and Southern
African countries may build upon their SACU-SADEC customs union agreements.

More time would be needed to form FTAs in West Africa, building upon the UEMOA monetary union, in East Africa, between neighbouring Kenya, Tanzania and Uganda, and in the Pacific.

The Commission suggests that a transitional period of 10 years or more could start in 2005 during which time it could implement the regional economic partnership agreements. These would also need WTO approval, and even then WTO would only give it if the FTAs were purely temporary and that trade access to the FTA member nations would be free for all by the end of the ten years.

ACP foreign ministers said Saturday the Lome Convention and international human rights conventions are violated in the EU on a regular basis, and they asked the EU to take action to stop the harassment of immigrants.

The ministers condemned the "inhuman, cruel and degrading treatment" inflicted on Semira Adamu, who died on Tuesday after police held a cushion over her face while trying to deport her.
They said the death of a Nigerian refugee in Belgium reflected the "inhuman practices" their citizens face across the EU.