John Maré
5 February 2008
opinion
Johannesburg — THE historic relationship between Europe and Africa, Mediterranean and sub-Saharan, remains of central relevance for each. However, the start of a new year sees it encountering fundamental challenges at a time of international flux that underscores the benefits of stabilised mutually beneficial relations.
The stakes are high and the way forward could have long-lasting consequences for both sides.
It is imperative that stakeholders try to promote positive results and that African businesses should become more informed and involved as their direct interests are especially affected.
The Lisbon summit between the European Union (EU) and Africa in December was a milestone but unfortunately failed to yield enough to suitably ease growing tensions. These were fuelled by the fact that overcoming increasingly complex hurdles seems to be the price Africa must pay for doing business with the world's most sophisticated market. Problems range from stringent EU criteria for food import quality to good governance criteria. Africa can benefit if capacity is built by overcoming these challenges.
Innovative ways for African business to manage its EU-related activities are needed urgently to make use of the opportunities that exist. Such moves can help enrich not only the EU-African relationship, but have spin-off positive results for African business in the broader global market place, where the EU dimension continues to be strong and tri-lateral approaches to business activities offer enhanced rewards.
A major problem needing attention is that economic relationships between EU and Africa, Caribbean and Pacific (ACP) countries in the context of the Cotonou Agreement, either terminated in some way at the end of last year, or have been incorporated into Economic Partnership Agreements (EPAs). The previous relationships were specifically supportive of development, but the EPAs are supposedly WTO-compatible based on free trade models, containing terms that are often contentious and do not build integrated regional economies.
The enormity of this issue for Africa is clear given the ongoing relevance of the EU for the continent; the ACP grouping includes all sub-Saharan Africa apart from SA
SA has a qualified ACP membership and its terms of trade with the EU are covered in a separate Trade Development Co-operation Agreement (TDCA).
The EPA intended for the Southern Africa Development Community was supposed to homogenise the EU trade aspects of the TDCA with those of the rest of the Southern African Customs Union (Sacu) where SA is the key economy. This intention was relevant for strengthened regional integration and an improved regional business climate.
Unfortunately SA could not agree to terms proposed by the EU and has now been excluded from an EPA, thereby further splitting the regional economy and almost endangering the existence of Sacu, the oldest customs union in the world, and the successful regionally integrated economy it has helped create.
It seems imperative for southern Africa and its relations with the EU that ways continue to be explored for this EPA to accommodate SA. Without such action the way ahead for the current TDCA review to include crucially important trade aspects seems unclear, and the review together with the special relationship that the EU has proposed for itself with SA, is in jeopardy.
A continuing status quo will not only hamper expanding EU relations but also perpetuate such difficulties as the ongoing situation where SA gives open tariff-free access to EU canned and beneficiated fruit and vegetables, whose production is heavily subsidised, while facing quotas and heavy tariffs for exporting the same unsubsidised produce into the EU.
The unfinished and unsatisfactory EPA issue is clearly a priority for starting to strengthen a damaged EU-African relationship that is of value to both sides. The southern African EPA should be a prime example of an EU-sponsored African programme, not its worst failure.
John Maré is an adviser on international public affairs and diplomacy, for multinational companies, governments and international organisations. He is a senior adviser in the AEAC consultancy network focusing on EU/African business issues.
Be the first to Write a Comment!
Copyright © 2008 Business Day. All rights reserved. Distributed by AllAfrica Global Media (allAfrica.com). To contact the copyright holder directly for corrections — or for permission to republish or make other authorized use of this material, click here.
AllAfrica aggregates and indexes content from over 125 African news organizations, plus more than 200 other sources, who are responsible for their own reporting and views. Articles and commentaries that identify allAfrica.com as the publisher are produced or commissioned by AllAfrica.
