Lukewarm response to EU-ACP trade deals

EU development ministers have responded cautiously to assurances from the European Commission that developing countries will not suffer from economic agreements being negotiated with the EU.

Peter Mandelson, the trade commissioner, told ministers at an informal meeting in Bonn this week (12 March) that the Africa, Caribbean and Pacific (ACP) states would have duty-free, quota free access to the EU market for all products, except sugar and rice. He added that ACP states would be allowed up to 25 years to bring down tariffs on certain products, thereby avoiding an immediate loss in revenue.

Mandelson stressed the importance of the economic partnership agreements (EPAs) as a way of bringing developing countries into the world market. "The fact is that ACP countries risk isolation from the global economy on a shrinking island of commodity trade…they export less now than they did 30 years ago," he said.

But some member states, in particular Denmark, the UK, Sweden, Finland and Ireland, are concerned that the EPAs will encourage quick liberalisation of vulnerable economies, exposing them to international competition. Loss of revenue through lower tariffs could result in the reduction of funds to vital sectors such as health and education.

One diplomat said that there were "smaller differences" now between the Commission and concerned member states but that the negotiations between the Commission and the ACPs for the rest of the year would be followed closely. "It’s a watching brief," said another diplomat, adding: "Mandelson is erratic and tailors his message to whatever audience is listening."

Some member states are wary of Commission insistence that ACPs must liberalise their economies. "His [Mandelson’s] line is always unless the ACPs turn into Singapore overnight they will have no chance," the diplomat added.

A deadline is set for the end of the year for the conclusion of negotiations on the agreements. The EPAs are being negotiated in response to a World Trade Organization ruling which said that the current preferential system between the EU and the ACP countries contravenes global trade rules.

EU development ministers have responded cautiously to assurances from the European Commission that developing countries will not suffer from economic agreements being negotiated with the EU.