Trade deal with poor nations threatened

Date: 07/12/00

By Peter Chapman

TRADE Commissioner Pascal Lamy's plan to open up EU trade in 'everything but arms' for the world's poorest countries is under threat from thinly-disguised attempts to scupper the proposal, diplomats claimed this week.

The accusation comes as the plan, unveiled earlier this year, continues to come under fierce attack from southern Union member states, the Caribbean and agricultural lobbies across the EU.

Critics inside the Union fear the initiative would lead to a flood of cheap imports of commodities such as sugar and rice, while countries in the Caribbean region claim their own exported goods, including bananas, would be priced out of the Union market.

Southern member states have succeeded in their efforts to force the Commission's agriculture directorate-general to carry out a series of impact assessment studies to examine how the proposal would affect the markets for sugar and rice in EU countries.

But diplomats from more liberal northern member states which support the plan claim that this is little more than a spoiling tactic. They add that there has been little progress in discussions on the issue since the studies were ordered six weeks ago.

Although talks got under way again this week, the earlier paralysis means there is no chance that member states will strike a deal on the proposals before the end of this year, as Lamy had originally hoped. "The studies are a deliberate ploy. The agriculture directorate-general does not want the proposal to go through. Its officials are concerned about EU farmers and, for them, the longer they can keep the studies under wraps the better," claimed one Union diplomat, adding that there were fears the figures would be manipulated to boost the arguments of the plan's detractors.

Although northern member states including Scandinavian countries, the UK and Netherlands have been lobbied hard by their farming sectors to oppose the plan, sources say they are unlikely to withdraw their general support for the initiative.

They remain unconvinced that poor countries would flood EU markets with imports of commodities such as sugar, believing that these nations do not have the productive capacity to do so. They have also dismissed fears that richer exporting countries would gain duty-free access to the EU by sending their goods to the Union via the poor nations, insisting that the European Commission has promised effective safeguards to ensure this cannot happen.

Under the Lamy blueprint - first mooted in the run up to last year's failed World Trade Organisation meeting in Seattle - the EU would give the 48 poorest countries in the world a special status and special privileges. Only arms would be excluded from the proposal, which covers 919 different product lines emanating from the poverty-stricken nations.

Trade Commissioner Pascal Lamy's plan to open up EU trade in 'everything but arms' for the world's poorest countries is under threat from thinly-disguised attempts to scupper the proposal, claim diplomats.