The EU’s trade deal with six southern African countries should be radically overhauled if the bloc is to retain its influence, a leading MEP has warned.
The European Commission has contracted a consortium led by BKP Economic Advisors GmbH/SQ Consult B.V to prepare an external evaluation study on the EU’s economic partnership agreement with six members of the Southern African Development Community (SADC) as part of a wider review of the deal. The evaluation study is expected to be completed by April.
In a report by the European Parliament, which was adopted by MEPs in Strasbourg last week, lawmakers warned that the geopolitical changes affecting EU-African relations and EU-SADC relations and the growing role of other actors such as China mean that the EU needs to significantly improve its offer to SADC countries.
“This needs more than just improvements in trade policy, Fundamentally, it requires adopting a mutually-beneficial and partnership-based approach to relations with SADC countries and other African nations,” Joachim Schuster, the German centre-left MEP who drafted the report, told EUobserver.
The EU’s offer “should be complemented by climate partnerships that should attract both private and public investment to the region,” said Schuster, adding that “this should be achieved through additional agreements rather than reopening the [economic partnership agreement] EPA itself.”
Although the EU is still the main trading partner with SADC countries, Mozambique, Namibia, South Africa and Botswana have seen significantly increased trade volumes with China.
In the case of Namibia, its trade with the EU nearly doubled from €1.1bn in 2016 after signing the EU EPA to €2bn. However, its trade with China grew almost nine-fold, from €0.3bn to €2.6bn.
“It’s crucial to recognise that addressing the development needs and aspirations of SADC countries goes beyond the scope of a traditional free trade framework. Instead, the EU should focus on fostering comprehensive cooperation that promotes local value addition and sustainable development, particularly in sectors such as renewable energy,” Schuster also said.
The economic partnership agreement with the SADC is one of the few successes in the EU’s attempts to broker trade deals with African regional blocs and is the only one that has been ratified and implemented in full.
However, the EPAs have been criticised by some African states and civil society groups who complain that they do not offer enough scope for SADC countries to develop supply and value chains and industrial bases.
The EU proposed organising a joint conference between with SADC on the five-year anniversary of the EPA, but the offer was not taken up by the SADC side. Instead, a trade conference with the participation of business representatives was foreseen.
“The current structure of the EU-SADC EPA primarily reinforces the traditional trade dynamic, with SADC countries serving mainly as commodity exporters,” Schuster told EUobserver.
“This limits the scope for SADC countries to develop robust supply and value chains or to promote industrialisation,” he added.
On Thursday (29 February), MEPs approved an EPA between the EU and Kenya, an agreement which breaks a 10-year deadlock.
366 EU lawmakers voted in favour of the EU-Kenya EPA, with 86 members against while 56 members abstained.
The pact will ensure Kenya’s exports, the bulk of which is made of agricultural produce and flowers, has duty and quota-free access to the EU market.
The text is largely identical to the EU-East African Community pact which was first agreed in October 2014 but then stalled when several countries in the EAC refused to sign it.
The major change is the inclusion of clauses around climate change.