Box 7: Concerns over the Development Impact of the EPAs Economic Partnership Agreements – EPAs – are essentially free-trade arrangements aimed at opening up the markets of poor countries to European goods. Seventy-six countries from Africa, the Caribbean and Pacific have been negotiating the deals with the European Commission (which negotiates on behalf of European Union member states) for five years. Using trade to lift poor countries out of poverty is meant to be at the heart of these agreements. But ACP governments and campaigners have expressed serious concerns that free trade between an established, wealthy trading bloc like the European Union and their own, poor economies will destroy farmers and industries in their own countries. In-depth empirical investigations and analyses by ACP activist organisations have produced comprehensive and cogent critiques drawing out the destructive anti-development implications of the reciprocal trade liberalisation that drives the proposed EPAs between the gigantic EU and the much smaller, weaker ACP countries(3). They expose the aims and the implications of the WTO-type ‘trade-related’ aspects of the EPAs, defined in the EC’s plans as ‘new generation’ issues. These include investment liberalisation, guaranteed protection for European corporate property and increased ‘intellectual property’ rights, the opening up of ACP services sectors and government procurement (public tenders) to the operations of European companies, the imposition of inappropriate ‘competition’ rules and much else. 433 There is a powerful critique pointing to damaging anti-development effects and other dangerous implications of the trade and other liberalisation dimensions of the EPAs, including: • The inherently unbalanced nature of trade flows between economies of very different sizes that are at totally different levels of development, encouraged by so-called ‘reciprocal markets’; • the consequent trade deficits in the weaker economies, contributing to balance of payments difficulties, continued external indebtedness and continuing aid dependence; • the extensive reduction in tariffs eroding the revenues of governments heavily dependent on custom duties for their budgets, with negative implications for essential public spending; • the intrinsically unfair competition between large and highly competitive producers/exporters from the EU, in relation to the much smaller and weaker counterparts in the ACP countries; • the inevitable decline and even closure of ‘uncompetitive’ companies in the ACP, contributing to the de-industrialisation already set in motion there by IMF and World Bank liberalisation programmes; • the accompanying retrenchments and exacerbation of unemployment, now reaching generalised and catastrophic proportions in most of the ACP countries; - 174 -