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LESSONS OF THE EPA
Norman Girvan
Civil Society Forum
12 June2008
http://normangirvan.info
Country
GSP SENSITIVE EXPORTS – 2005 data
% EXPORTS
TO EU
% TOTAL
EXPORTS
% EXPORTS
GOODS &
SERVICES
BELIZE
75.1
20.7
8.5
GUYANA
72.3
27.7
21.8
ST. KITTS & NEVIS
71.5
0.1
0.0
JAMAICA
47.6
11.0
4.3
SURINAME
44.8
DOMINICA
42
7.4
2.3
ST. LUCIA
27.4
11.1
1.0
BARBADOS
21.7
4.2
0.5
TRINIDAD AND TOBAGO
17.4
2.7
0.3
GRENADA
9.1
2.3
0.4
ST VINCENT/GRENADINES
3.9
1.2
0.2
BAHAMAS
3.4
0.0
0.0
ANTIGUA & BARBUDA
1.4
0.0
0.0
DOMINICAN REPUBLIC
COUNTRY
VULNERABLE PRODUCTS
Belize
BANANAS, SUGAR, ORANGES
Guyana
SUGAR, RICE, RUM
St. Kitts & Nevis
SUGAR (?)
Jamaica
SUGAR (CANNED ACKEE)
Suriname
BANANAS, RICE
Dominica
BANANAS
Dominican Republic
BANANAS, RUM
St. Lucia
BANANAS
Barbados
SUGAR, RUM
Trinidad and Tobago
SUGAR (?), JUICES, JAMS, FOOD
PREPARATIONS, METHANOL
Grenada
..
St Vincent/Grenadines
BANANAS
Bahamas
..
Antigua & Barbuda
ANCHOVIES
1. Removes duties and all other restrictions on the
majority of imports from Europe within 15 years.
(13% are permanently excluded).
2. requires that such imported goods be given the same
treatment as national and regionally produced goods
3. requires an overhaul of customs and trade
administration to conform to standards largely set by
Europe
4. circumscribes the kind of actions that governments
are allowed to take to defend national producers and
regional producers against unfair competition from
bigger and much better European firms
5. grants EU firms immediate free access to the
majority of our service sectors
6. requires that service suppliers from Europe be
granted the same treatment as national and regional
service firms,
7. restricts the ability of regional governments to regulate
service industries in the public interest
8. allows European service firms to bring in their own
people as senior managers without specific qualifications
and recent graduates as interns,
9. guarantees that European firms that establish
themselves here can repatriate their capital and current
earnings freely
10.requires regional governments to pass new laws and set
up new institutions in Intellectual Property, Competition
Policy, Pubic Procurement, and e-commerce that are
mainly aimed at facilitating European business and
conforming to the European global trade policy agenda
11.pre-empts Caricom’s own development policies in these
areas and hence in effect supersedes the CSME process
12.establishes an implementation machinery, presided over
by a joint Council with the EU and the DR with binding
13.establishes a Trade and Development Committee with
powers to supervise, monitor and implement every
aspect of the agreement;
14.establishes a Dispute Settlement Machinery which
tightly circumscribes the ability of governments and
government agencies to get out from under the
obligations of the agreement and allows for punitive
trade sanctions in the event of non-compliance
15.requires that OECS countries open their economies to
imports from the DR as well as Europe, hence removing
their special and differential treatment that they currently
enjoy in the Caricom-DR FTA
16.requires that we extend to Europe whatever we might
agree in the future with other large developing countries,
and
17.is an international treaty with legally binding force, of
indefinite duration, and with limited scope for revision
% and timing of imports to be liberalised
COUNTRY
ANTIGUA / BARBUDA
0
5Y
10 Y
15 Y
20Y
25Y
EXC
7
7
25
35
2
2
22
BAHAMAS
32
2
13
34
3
2
13
BARBADOS
48
0
2
24
1
1
23
BELIZE
13
6
10
27
1
3
39
DOMINICA
17
3
18
27
2
1
27
DOMINICAN REPUBLIC
53
8
5
21
3
5
5
9
14
20
25
2
3
28
GUYANA
53
1
7
18
2
1
18
HAITI
60
0
1
7
2
4
27
JAMAICA
56
0
1
26
2
1
13
ST. KITTS AND NEVIS
18
16
16
17
2
2
29
ST. LUCIA
38
0
4
22
5
2
29
ST. VINCENT/GREN
8
7
14
30
2
2
37
SURINAME
9
9
20
27
2
3
28
TRINIDAD/TOBAGO
73
0
1
18
0
1
6
CARIFORUM
53
3
5
22
2
2
13
GRENADA
A ‘Level Playing Field’?
POPULATION GDP
(Millions)
(PPP)
$ Bil.
12165
PER
CAPITA
GDP
(PPP)
24,811
CARIFORUM 25
138
5,532
CARICOM
65
4,220
EU
490
15
Country
Dominica
St Kitts Nevis
St Vincent
Grenada
Antigua
St Lucia
Belize
Guyana
Suriname
Barbados
Bahamas
Jamaica
Haiti
Trinidad and Tobago
Dominican Republic
Denmark
Romania
Portugal
Czech Republic
Greece
Austria
Sweden
Belgium
Poland
Netherlands
Spain
Italy
France
United Kingdom
Germany
GDP (PPP)
GDP (PPP) LEVEL
2006
PLAYING ON THE
FIELD
2,500,000,000,000
Aggregate GDP – PPP 2005
2,000,000,000,000
15 RICHEST EU COUNTRIES
1,500,000,000,000
1,000,000,000,000
CARIFORUM COUNTRIES
500,000,000,000
0
CARIFORUM Adjustment Costs
Estimated – Milner Report 2005
1. Fiscal adjustment costs:EU 375 m
2. Trade facilitation and export development
costs: 240 m EU
3. Production and employment adjustment costs:
140 M
4. Skill development and productivity
enhancement costs:EU 210 M
• TOTAL 924 M
•
Amount allocated for EPA implementation in 10th EDF: 33 M
ESTIMATED EPA ADJUSTMENT COSTS FOR CARIFORUM COUNTRIES (in million €) (in 2005-equivalent prices)
NO.
COUNTRY
Fiscal
Export
Diversificat
Employment
Skills/
Productivity
Total
Adjustment
Adjustment
ion
Adjustment
Enhancement
Costs
1
HAITI
50
20
20
30
120
2
DOMINICAN REPUBLIC
50
20
25
20
115
3
GUYANA
15
30
6
10
61
4
SURINAME
20
10
6
15
51
5
JAMAICA
40
12
12
15
79
6
BARBADOS
20
5
6
10
41
7
BELIZE
20
10
6
10
46
8
DOMINICA
20
5
6
15
46
9
GRENADA
20
30
6
15
71
10
ST KITTS AND NEVIS
20
5
6
15
46
11
ST. LUCIA
20
5
4
10
39
12
ST. VINCENT/GRENADINES
20
30
6
15
71
13
TRINIDAD AND TOBAGO
40
12
25
15
92
14
BAHAMAS
20
5
6
15
46
Objections to a ‘Full’ EPA
• Includes Chapters ON Investment and Current
Account payments, Competition Policy, Public
Procurement, Intellectual Property
• The commitments are immediate, legally binding
and indefinite; while the supposed benefits are
in the future and unenforceable.
• Restrict the ability of CF governments to foster
the development of local and regional
enterprises and to regulate their economies in
the public interest--indefinitely.
•Pre-empt and prescribe the CSME policy regimes in
these areas.; These ought To have been crafted to
foster the development of local and regional
enterprises better equipped to penetrate extra-regional
markets.
•Undermine the negotiating position of the CF and
other developing countries in the WTO
•Commit governments to onerous implementation
obligations-- new laws and regulations and to set up
new institutions
Other Contentious Clauses
• Regional Preference
– Requires the Caricom LDCS to open their
markets to the Dom Rep as well as to the EU
• Most Favoured Nation (MFN) Clause
– Requires Cariforum to grant the same
treatment to the EU as they may garnt to
China, India, Brazil and MERCOSUR in any
future trade agreement
JOINT CARIFORUM-EC COUNCIL
TRADE AND DEVELOPMENT
COMMITTEE
COMMITTEE ON CUSTOMS COOPERATION AND TRADE FACILITATION
PARLIAMENTARY COMMITTEE
CONSULTATIVE COMMITTEE
Girvan EPA 01/05/08
15
IMPLEMENTATION OF THE EPA
• 336 identified implementation actions
– 90 legislative
– 72 institutional
– 110 policy
– 64 other
– Most are to be taken on provisional
application of the EPA
Outstanding for CSME implementation: 384
(2005)
LESSONS OF THE EPA
•
•
•
•
•
•
•
•
•
Absence of strategic political management
Ad hoc and expedient decision-making
Failure to maintain the ACP alliance
Failure to tap into potential sources of political
support in Europe
Failure to present our own development agenda
as the framework for the negotiations
Delays in CSME implementation of the CSME
Aceptance of negotiations on the EC template,
coming directly out of the Global Europe project,
Ideological and institutional co-optation of key
elites in the region
Lack of genuine popular involvement in the
process
Advocacy demands
1. Renegotiate the EPA to remove its
objectionable features and to insert
features designed to protect the public,
national and regional interest; preserve the
space for autonomous development policy
and protect the integrity of the regional
integration movement.
A RENEGOTIATED EPA
1. Limit the EPA to what is necessary to ensure WTO
compatibility;
2. Seek the widest possible interpretation of what
constitutes ‘substantially all trade’ vis-à-vis degree
and phasing of liberalization
3. Phasing import liberalization in line with
development of production capacities in import
substitution and exports (Brewster)
4. Insisting on binding obligations for development
support
5. Removing the ‘Regional Preference’ and ‘Most
Favoured Nation’ clauses.
6. Insertion of legally binding development
benchmarks to be monitored by the Joint
Parliamentary and/or Consultative Committees
with legally binding powers
‘Plan B’
• Demand insertion into the agreement of
– Development Benchmarks (social and
economic) as legally binding monitoring
instruments
– A Review Clause that compels an
unconditional review of all EPA provisions
after the first three years of operation, with
possibility of renegotiation. There is a similar
feature in the CPA.
‘Plan C’
• Call for Cariforum or Caricom governments to
collectively issue a Joint Declaration stating that
they are signing the EPA in spite of severe
reservations, and that they reserve the right to
undertake a comprehensive review of the EPA within
three years of signature, to determine its
development impact and its impact on regional
integration; and to seek, on the basis of such a
review, a comprehensive renegotiation of the EPA in
line with WTO rules and the development and
integration needs of the region.
‘Plan D’
• Press governments to commission an
independent, socio-economic impact
analysis of the initialed EPA to determine
challenges, threats and opportunities to
farmers, businessmen small and large,
workers, women, youth, and recipients of
public and social services; and declare
that the EPA lacks legitimacy.