EPAs:
Forging an Instrument for Development
Dame Billie Miller, CARIFORUM Ministerial Spokesperson on EPAs
The third phase of negotiations for an Economic Partnership
Agreement (EPA) between CARIFORUM countries and the European Union is
being launched today, in Saint Lucia.
The EU Commissioners responsible for Trade and Development Cooperation,
Peter Mandelson and Louis Michel respectively, have been promoting the
EPA as a tool for addressing supply-side constraints and institutional
shortcomings in the Region. The results so far have been less than convincing.
Resources that could be directed at addressing these constraints have
not been delivered by the European Commission, and in this regard it
is expected that CARIFORUM Trade Ministers will express their scepticism
and deep disappointment forcefully to Commissioner Mandelson.
The Region’s position is that neither trade nor market access
by themselves are sufficient to promote development. Countries suffering
from capacity constraints and institutional inadequacies will not be
able to make the best use of market access, even under preferential terms.
It is for this reason that CARIFORUM has been insisting on the need for
an EPA to address the Region’s development needs. This position
has been emphasized time and again.
With trade liberalization, preferential market access
granted to developing countries has been reduced; and this has had
far reaching and devastating consequences for Caribbean societies. In addition to sustaining
many of the Region’s economies, preferential access to European
markets safeguards the livelihood and welfare of tens of thousands of
families in the Caribbean.
Over the past year and a half of discussions, the
Region is greatly concerned about the Commission’s commitment
to development in its interaction with CARIFORUM, especially given
the challenges facing export commodities such as sugar and bananas
entering the EU market.
CARIFORUM is disturbed that as the two sides meet to take stock of
progress in Phase II of EPA negotiations and provide political instructions
on the future orientation of those negotiations and consider issues germane
to Phase III, the European Commissioner for Development will not be present
at the encounter. This is particularly troubling, as CARIFORUM has consistently
highlighted that negotiations for an EPA are about crafting an instrument
for development-centred trade liberalization. This approach enables an
EPA to build on the Cotonou Partnership Agreement (CPA).
An EPA is not an end in itself, but a tool for development, and as
such must be complemented by specific support measures. It must seek
to strengthen CARIFORUM regional integration, while contributing to sustainable
development and poverty alleviation.
The design of an EPA must take into consideration the differences in
size and levels of development, between CARIFORUM and the EU. The pace
of what should be asymmetrical trade liberalization must be set by CARIFORUM,
with clear exceptions for sensitive products.
An EPA is intended to be a modern trade agreement,
contributing to an environment in which corporate entities can improve
their international competitiveness. While there is the expectation
that the EPA will mediate the Region’s transition to full international
competitiveness and synchronize the CARIFORUM economic space with the
dynamic aspects of the global economy, it must be based on a sound
development thrust.
As negotiations are poised to enter Phase III, there is agreement on
both sides that the second phase of negotiations can only be described
as a qualified success. What has been achieved so far is a good basis
for deliberations in Phase III, but there remain mounting concerns over
the scope and pace of the adjustment process, which would result from
the conclusion of an EPA with the EU. In particular, there is increasing
apprehension as Governments contemplate the burden of financing economic
restructuring and export diversification, while adjusting to the fiscal
fallout from reduced tariffs.
The Region must contend with this adjustment at a
time when f undamentalist free trade policies are eroding what little
policy space remains available to small, vulnerable developing economies.
This trend is foreclosing the development options of countries such
as ours in the Caribbean.
It is of paramount importance, given the adjustment process the Region
faces, that the promised Commission support for advancing the regional
integration process and addressing supply-side constraints begin to flow
as soon as possible, and well before the scheduled conclusion of EPA
negotiations at the end of 2007.
September 30 , 2005
Gros Islet , Saint Lucia
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