Spinning a deal with the ACP?

By David Cronin

Date: 28/04/05

For much of his career, Peter Mandelson has been associated with the art of spin. So when the European commissioner for trade insists that he wishes to use his portfolio as a tool for poverty alleviation, it comes as no surprise that others ask for proof that he can turn his rhetoric into reality before taking him at face value.

Although it may not garner as much media attention as the transatlantic dispute over aircraft subsidies for Boeing and Airbus, one of Mandelson's key challenges for his five-year term is to renew trade accords with the 79-member African, Caribbean and Pacific (ACP) bloc. To be known as the Economic Partnership Agreements (EPAs), these are to come into effect in 2008 and will replace existing schemes designed to give ACP products preferential access to the Union's markets.

Addressing the ACP-EU Joint Parliamentary Assembly in Mali last week, Mandelson stated that the accords must complement the UN's Millennium Development Goals of large-scale reductions in global poverty by 2015. "You have my absolute commitment that this will form the bedrock of my approach," he affirmed. "For what we are doing in our trade relations meets my broader view of politics. It's about providing a framework of opportunity, in which economic change and social justice combine. It's about finding one's way in the global economy, dealing with its inequalities and harnessing its strengths."

Some analysts suggest that if Mandelson is to make good on that pledge, he will need to shake up the European Commission's directorate-general (DG) for trade. Until now, it has had a reputation for pursuing European commercial interests in a somewhat bellicose manner. Such an approach might be necessary when haggling with the US, yet something different is required for handling the ACP, a group that comprises all bar nine of the world's least developed countries.

Patricia Hewitt, the UK secretary for trade and industry, is among those who have asked Mandelson to ensure that experts on the links between trade and poverty be appointed to DG Trade, so that they can assess the impact of its policies on the world's poor.

There is some nervousness inside the DG about perceived meddling by Hewitt. One official says there is a view that Mandelson is more eager to heed the views of the British government than the EU executive and that the level of consultation between the commissioner's cabinet of advisers and the DG is inadequate. Prime Minister Tony Blair has vowed to make poverty in Africa and climate change its two top priorities for the UK's EU presidency in the second half of this year.

During the last Commission, responsibility for trade relations with the ACP countries was transferred from DG Development to DG Trade. A unit there is now overseeing the EPA negotiations and its remit, says another insider, is to ensure the accords are "a genuine tool for development". He plays down suggestions of tension between Mandelson and the department's 'traditionalists', adding: "DG Trade has always had a strong commitment to development."

One sign of a possible change in Mandelson's position on the EPAs concerns the so-called Singapore issues. Covering investment, competition policy and transparency in government procurement, most of these questions have been excluded from the Doha Round of world trade talks after opposition from developing countries.

Mandelson has been arguing that these should nonetheless be included in the EPA talks. Until recently, he sought to deflect concerns voiced by various charities that pursuing the issues could leave ACP nations powerless to restrain unscrupulous multinational investors. Representatives of ACP governments do not seem to share the charities' view, he has claimed.

Then, however, Kenya and Zambia rejected Mandelson's argument. Zambia's Trade Minister Dipak Patel said he was concerned that despite their removal from the Doha round, the EU was pushing the Singapore issues with a "backdoor approach".

Earlier this month, the international development committee at the UK's House of Commons' report alleged the Union was treating the EPA talks as "if they were a game of poker".

"The Commission is refusing to lay its cards on the table and to dispel the ACP's fear that it stands to lose more than it will gain," the report said. "While this may be acceptable behaviour for partners with comparable hands, it is unnecessary and unwelcome in the current negotiations."

Aides to Mandelson say he has decided the Singapore issues should only be dealt with in the final stages of the negotiations. The question of Europe's access to the ACP markets would be considered only after it is known what level of access the ACP countries would have to the EU's markets.

"Mandelson's approach on the EPAs, as far as can be judged, is much more of a shift in tactics than in substance," argues Tetteh Hormeku from the Third World Network in Accra, Ghana.

"On the Singapore issues, Mandelson only wants to adopt a less aggressive approach, which presumably means leaving the issues to the very end. Whether they are left to the very end of the negotiations or not does not change the essentially anti-developmental character of these agreements."

Hormeku raised worries that the accords could usurp ACP states' access to affordable medicines if the Union insists that they adhere to its new rules on 'data exclusivity'. To come into effect in November, these would grant exclusive marketing rights to pharmaceutical companies for certain medicines, even if they were not under patents. According to Hormeku, this could enable large drug firms to "charge monopoly prices", damaging the ability of poor countries to meet their public health needs.

Matt Griffith from the Catholic Agency for Overseas Development (CAFOD) says he would not be surprised if Mandelson ditches the Singapore issues entirely. "They are such an obvious inconsistency for the European Commission and also a potential lightening rod for ACP disquiet about the wider EPA process," he adds.

He describes Mandelson as sympathetic to the anti-poverty lobby but bemoans the lack of interaction between trade and development officials in the Commission. "The problem is the complete dominance of DG Trade officials driving EPA negotiations. There is virtually no joining up between DG Trade and DG Development officials and member states have no ability to peak over the sides to see what's going on."

Tom Sharman of ActionAid concedes Mandelson has been constrained by the negotiating mandate given to him by EU governments, which include the Singapore issues. But he feels that the commissioner should seek a fresh remit, which takes greater account of how the ACP bloc is much weaker economically than the Union.

"We have had a lot of rhetoric and at face value, it sounds good," Sharman says. "But the problem with trade negotiations is that they are very detailed. It is the detail that counts."

Major analysis feature looking at the agenda of the European Commissioner for Trade, Peter Mandelson, especially in relation to the renegotiation of trade relations with the ACP countries and the WTO's Doha talks, to be resumed later in 2005.