Oxfam warns EU-ACP free trade deals are unfair

See Oxfam NZ website at www.oxfam.org.nz

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For immediate release- September 27, 2006

Oxfam warns EU-ACP free trade deals are unfair –
call for comprehensive review

The European Union must urgently change its negotiating position on free trade deals with some of the world's poorest countries, or risk sinking them further into poverty, international agency Oxfam said today.

On the fourth anniversary of the opening of negotiations between the European Union and the African, Caribbean and Pacific (ACP) countries, Oxfam said that Europe is still failing to put development at the heart of these trade agreements.

In a 15-page report entitled Unequal Partners, Oxfam says that the proposed Economic Partnership Agreements (EPAs) will hurt rather than help the 75 ACP countries, 39 of which are Least Developed Countries (LDCs). The Commission's mandate, given from EU member states, must be revised to reflect key concerns coming from ACP regions and civil society groups, Oxfam says.

A meeting of Pacific civil society groups organised by Oxfam New Zealand and Oxfam Australia earlier this year highlighted concerns over the rapid progress of negotiations and the lack of consultation with Pacific peoples. The participants noted that there had been little investigation into the potential effects of the Pacific EPA that could impact areas as diverse as telecommunications, provision of water and sanitation services, and land ownership. Negotiations are particularly high-stake for the Pacific, as any agreement reached with Europe will strongly influence future agreements with the region's two major trading partners, Australia and New Zealand.

The disparity in size between the negotiating parties is striking, with the EU's economy over 1,400 times larger than the Pacific's.

"It's clear that the European Commission's position needs to be seriously revised. Many ACP countries are deeply concerned about the way negotiations of these free trade deals are going. The future of some of the world's poorest people is at stake and Europe refuses to heed their concerns. That is simply unacceptable," said Luis Morago, Head of Oxfam's Brussels Office.

Oxfam calls on the European Union to use the formal review of the EPA process over the next few months to redirect negotiations onto a different path. As a starting point, the European Commission should use the flexibility in the Cotonou Agreement between the EU and ACP to offer a fair deal to some of the world's poorest countries. This means dropping its ambitions of having reciprocal market access with ACP countries. Instead, Europe must focus on further opening its own market to ACP exporters and helping them overcome the barriers to trade on issues such as capacity constraints and restrictions on the rules of origin.

Oxfam warns that ACP concerns are being ignored, and that through EPAs, ACP governments stand to lose control over key policy instruments such as tariff policy, and competition and investment rules that all developed countries have used to progress in the past. Europe is pressuring ACP governments to include these in the final agreement, despite the fact that developing countries have repeatedly objected to this – both at the WTO and in EPA negotiations.

Oxfam highlights that if EPAs are to be pro-poor deals, they should not lead to losses in government revenue and employment, and that there is a need for comprehensive studies of the social, economic and cultural impacts of any EPA. The report argues that funding for the costs of adjustment must not be at the expense of money for health, education and infrastructure already provided by the European Development Fund and other European aid packages.

"To have a fair and equitable trading partnership between Europe and its ACP partners, you can't have one side constantly dictating the rules of the game. It is unacceptable for the EU to insist on reciprocal deals between regions of such different income levels," says Barry Coates, Executive Director of Oxfam New Zealand.

"The EU must offer Pacific and other ACP countries the alternatives that were promised in the Cotonou Agreement, specifically the right to trade terms no less favourable than they currently have. This should be supplemented by a real development package that provides opportunities to small Pacific companies and communities to benefit from trade and investment," Coates concluded. /end

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