Executive summary



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Adapted from PMA Cotonou 2002 – www.pmagouv.bj


The ACP Group has prepared itself only partially for the radically different context in which it operates vis à vis the EU. The position papers and guidelines issued by the Secretariat at the behest of the Committee of Ambassadors and the Council show the awareness of the dangers inherent in the EPAs discussed below in Chapter 3.
The ACP Group has shown sharp awareness of a long-standing trend in the EU and especially the European Parliament to end the stand-alone nature of the European Development Fund with its multi-annual nature, its predictability and its co-management, by including it in Heading 4 “External Actions”22. There is also an awareness amongst those interviewed that the new constitution of the EU under referendum has no protection for the ACP Group as did the Treaty of Rome.
In the last Section of this Study, the improvements to the institutional structures of the ACP Group will receive attention. Chapter 3 will deal with the New World Order and the New Global Context in which the ACP Group needs to accommodate itself.
The remarkable durability of the ACP Group which has grown from 46 members to the present 79, not all of the members being from the mould of newly independent states, is a historic march in itself. Has the Group achieved sufficiently the goals it has set itself? Statistics show that, in Africa, economic growth of 2% has hardly outstripped population growth since adhesion to the Lomé/Cotonou Conventions/Agreements. Growth is not an absolute indicator, but Table 7 is a fair pointer that things could have shown greater improvement in the decades the EDF has meant to alleviate poverty:

TABLE 7: INDICATION OF ACP COUNTRIES’ GDP (2002) PER CAPITA % GROWTH


COUNTRY

Per Capita GDP 2002 (US$s)

GDP Per Capita Growth Rate (%)

GDP Year of highest value







1975-2002

1990-2002




AFRICA













Angola

857

-1.5

-0.1

1992

Benin

411

0.6

2.1

2002

Botswana

3 080

5.1

2.1

2002

Burkina Faso

264

1.1

1.6

2002

Burundi

102

-0.9

-3.9

1991

Cameroon

575

-0.6

-0.1

1986

Cape Verde

1 345

3.0

3.4

2002

Central African Republic

274

-1.5

-0.2

1977

Chad

240

-

-0.5

1977

Comoros

437

-1.0

-1.4

1985

Congo (Brazzaville)

825

-

-1.6

1996

Congo (DRC)

111

0

-

1975

Côte d’Ivoire

707

-2.0

-0.1

1978

Djibouti

861

-4.6

-3.8

-

Equatorial Guinea

4 394

12.7

20.8

2001

Eritrea

150

-

1.5

1998

Ethiopia

90

0.2

2.3

2002

Gabon

3 780

-1.5

-0.2

1976

Gambia

257

-0.2

-

1986

Ghana

304

0.3

1.8

2002

Guinea

415

1.5

1.7

2002

Guinea Bissau

141

-0.3

-2.2

1997

Kenya

393

0.3

-0.6

1990

Lesotho

402

3.2

2.4

2002

Liberia

-

-

-

-

Madagascar

268

-1.6

-0.9

1997

Malawi

177

0.2

1.1

1979

Mali

296

-0.2

1.7

2002

Mauritania

348

0.3

1.6

2002

Mauritius

3 740

4.6

4.0

2002

Mozambique

195

2.0

4.5

2002

Namibia

1 463

-0.2

0.9

1980

Niger

190

-1.9

-0.8

1979

Nigeria

328

-0.6

-0.3

1977

Rwanda

212

-0.6

0.3

1983

Sao Tomé & Principe

326

-0.6

-0.4

-

Senegal

503

-0.1

1.2

1976

Seychelles

8 320

3.0

2.6

-

Sierra Leone

150

3.0

2.6

1982

Somalia

-

-

-

-

South Africa

2 299

-0.7




1981

Sudan

412

0.9

3.1

2002

Swaziland

1 091

1.8

0.1

1998

Tanzania

267

0.6

0.7

2002

Togo

291

-1.2

-0.7

1980

Uganda

236

2.6

3.9

2002

Zambia

-2.1

-1.2




1976

Zimbabwe

639

-

-0.8

1998

CARIBBEAN













Antigua & Barbuda

10 449

4.3

2.6

2002

Bahamas

15 797

1.5

0.1

1989

Barbados

9 423

1.2

0.1

2000

Belize

3 332

2.8

1.7

2002

Cuba

-

-

3.5

-

Dominica

3 438

3.3

1.4

2000

Dominican Republic

2 514

1.9

4.2

2002

Grenada

4 060

3.7

2.7

2000

Guyana

937

0.6

4.1

2000

Haiti

415

-2.3

-3.0

1980

Jamaica

3 008

0.4

-0.1

1991

St Kitts & Nevis

7 745

5.3

3.5

2002

St Lucia

4 124

3.7

0.2

1998

St Vincent & the Grenadines

3 084

3.3

1.1

2000

Suriname

2 199

-0.8

0.5

-

Trinidad & Tobago

7 384

0.8

2.9

2002

PACIFIC













Cook Islands

-

-

-

-

East Timor

497

-

-

-

Federation of Micronesia

-

-

-

-

Fiji

2 281

0.9

1.8

1999

Kiribati

-

-

-

-

Marshall Islands

-

-

-

-

Nauru

-

-

-

-

Niue

-

-

-

-

Palau

-

-

-

-

Papua New Guinea

523

0.4

0.5

1994

Samoa

1 484

-

3.2

-

Solomon Islands

541

1.6

-2.4

1996

Tonga

1 347

1.9

2.2

2002

Tuvalu

-

-

-

-

Vanuatu

1 138

0.2

-0.1

1984

Adapted from: Human Development Report 2004 / http://trade-info.cec.eu.int
As to trade, according to a study initiated by the World Bank, African countries’ share of the EU market has declined from 3% in 1985 to 0,9% in 2003 partly, it is claimed, because of restrictive Rules of Origin (recognised even in the Cotonou Agreement and by the Joint Technical Committee on EPAs) and declining commodity prices – and this in spite of the preferential access to the EU markets.23 EU statistics give a larger (but still declining) percentage of 2,76% of EU imports from the ACP as a whole for 2004 (average decline of –5%).
Nevertheless, the EU remains the most important single market for Africa members of the ACP Group. The share of Caribbean and Pacific countries’ exports to the EU market is less significant: in the case of the Caribbean (except Antigua) ranging from 7% to 39% and smaller yet for the Pacific (with the exception of Marshall Is and Tuvalu) ranging from 2% to 25%.
The ACP-EU link therefore remains of the hub and spoke variety. The intra-ACP trade relations Pacific – Africa – Caribbean hardly appear on the radar screen and intra-African trade accounts only for 6% of African trade (if South Africa is excluded) according to some figures but is still a meagre 9,2% if South Africa is included.24 Recommendations as to how to remedy efficiency in the EU-ACP relationship are given in Chapter 3.

-o0o-


CHAPTER 3: A NEW PARADIGM FOR THE ACP GROUP
CHAPTER 3(a): NEW WORLD ORDER: THE WHOLLY NEW GLOBAL CONTEXT FOR THE ACP GROUP: A PARADIGM SHIFT
The ACP Group has hung together, expanded and avoided divisions over three decades. It has faced continual expansions of the EU, but now its whole derivative nature and its response to a new order provides a series of potentially dangerous challenges to the outward cohesion of the Group and to its ability to meet the requirements of the EU’s political agenda which predicates the developmental implementation in terms of Annex IV of the Cotonou Agreement. The EU has thrown down the gauntlet to the ACP Group to match political standards and practices in order to unlock the resource allocation based on “needs and performance”.
Furthermore, on a trade level, the EC is gearing up to negotiate Economic Partnership Agreements with the six different regions of the ACP Group with a view to synchronising and harmonising trading arrangements compatible with the World Trade Organisation’s provisions on non-preferential trade and to achieve viable region-region agreements. Thus, for the first time ever, the EC is preparing to make direct, binding agreements with segments of the ACP which have implications for the cohesion of the ACP Group. The ACP Secretariat and the European Trade Commission in 2003 negotiated some of the principles to the Agreements at the all-ACP level, reached agreement of common areas of understanding and thereafter in 2004 moved to separate regional negotiation: but the EC and the ACP Group differed on the scope and coverage of the issues and the sequencing – the ACP Group wanted the rules aspect of trade-related issues to be resolved at all-ACP level before the EPA regional negotiation.25 A Joint Technical Co-ordinating Committee will follow these differences. A model seems to be South Africa’s Trade Development and Co-operation Agreement.
There are complications in obtaining single agreements from regional groupings with the differing level of development of the members and the privileged position of LDC’s in trade arrangements which has been highlighted by the World Bank-originated study. A belief persists amongst ACP States that the regional approach benefits the EU, divides the ACP Group and that, although the agreements are to be called Economic Partnership Agreements, they take little cognisance of development, infant industries and the fragility of monoculture economies, being, as many of those interviewed emphasised, negotiated by the Commission for Trade and hard-nosed, commercially-minded officers. EC Delegates in the ACP States consulted for the Study are optimistic about accommodating differentiated arrangements within the EPAs – though are vague about protection for emerging and diversifying industries in ACP States, and from what has been gathered, no specific guidelines on protecting infant industries or import substitution plans have been issued to the EC Delegates.
A recent UK policy statement agreed on by the Departments of Trade and Industry and of International Development put the cat amongst the pigeons by emphasising the harmful effects of trade liberalisation and the need for an alternative to EPAs.26
At present the timetable for the completion of the EPAs is the end of 2007, though it appears that, while negotiations are in progress, no concrete resolutions have been put on the table. So during a visit to the Caribbean in the preparation of this Study, information was obtained that the negotiations target CARICOM as the “implementing partner” for the EU in the region and the system is beginning to take shape with the exception of Haiti which remains a conundrum being closer to the USA than the rest of the region.
The Cotonou Agreement endures until 2020 although during negotiations, the option of making it a permanent agreement was not accepted by the Council of Ministers – the ACP Group therefore has fifteen years to ensure its relevance in the EU context which will from now include another ten (and later, other) New EU Member States who have not the same tradition of dealing with the developing world outside of Cold War solidarity undertakings and commodity off-take.
In the European constitutional provisions, now under referendum in EU States, there is no equivalent provision to Articles 131-136 of the Treaty of Rome guaranteeing special treatment of ACP members. Pacta sunt servanda and the EC declares it will not renege on its undertakings to the ACP Group - this was affirmed by members of the Directorates consulted in the course of this Study. There is general agreement amongst all those consulted, and confirmed within the EC Directorates interviewed, that the ACP Group will not have and can no longer expect, a guaranteed position written in stone. Other priorities have come to prominence like the EU’s preoccupation with its neighbouring states and North Africa. The EDF, the cornerstone of the relationship, stagnates and even diminishes by comparison with all development aid.
Leading up to 2020, the ACP Group will of necessity have to provide reasons for a continued group dynamism so as not allow the aid to its members to slide into the generality of the “External Activities” of Heading 4 of the EC budget where it is subject to the vagaries of politics. The ACP is said to be an acquis communautaire and that “best practices” in the EDF will continue as in the past27 – but this flies in the face of the single set of procedures for the EU budget, and the ACP Group is well aware of how being treated as just one of the recipients of development aid will affect the group activities and special relationship with the EU, and this is exacerbated by the enlargement of the EU to include countries themselves receiving aid28. (See Annex “E”). Already, as far as loans by the European Investment Bank are concerned, ACP applicants are treated in the same way as applicants from other regions.
The ACP Group’s core business depends on its derivative nature from the EU and it is to this that three points of the terms of reference of this study refer namely:


  • the political nature of the ACP Group, the trade element introduced by the Cotonou Agreement and the traditional co-management of development aid;




  • its improved efficiency; and




  • its future in the evolving EU.

The priority lies in making recommendations to face up to this evolving environment in the EU where the ACP has its lifeline.



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