In this interview, Alhaji Mohamed Daramy affirms his support for economic partnership agreements (EPAs) but warns that the required fiscal reforms will not come without an upfront cost, and he believes an EPA regional fund should be created to support this process, to which the European Union (EU) should contribute. He argues for a five-year transition period after the signature of an EPA, after which an efficient indirect taxation system should be put in place. Within this period, ECOWAS will aim to move some activities from the informal sector to the formal economy. The certainty and sustainability of financing ECOWAS activities will then be reviewed at this point.
Health equity in economic and trade policies
An interview with Alhaji Mohamed Daramy, ECOWAS Commissioner for Trade, Customs and Free Movement of Persons and Goods
Trade Negotiations Insights 9(5): June 2010
Economic partnership agreements and food security
Matthews A: Trade Negotiations Insights 9(5), June 2010
The African, Caribbean and Pacific (ACP) countries face a massive challenge in tackling hunger and under-nutrition, but many critics have argued that the commitments required of ACP countries under Economic Partnership Agreements (EPAs) will make this more difficult. This article investigates the threat to food security posed by these agreements. While some observers blame trade liberalisation for these problems, the article identifies the lack of investment to improve productivity and address supply-side constraints as the major limiting factor. It argues that the debate around the issue of EPAs and food security distracts from the more important question of what domestic initiatives ACP countries need to take to ensure that agriculture can play its role as an engine of economic growth and poverty reduction. Government should invest in agriculture rather than rely on trade restrictions for food security. The potential of EPAs to improve food security can only be realised by a focus on greater agricultural investment and improved institutions. Resources can be made available from the EU budget, the EU’s European Development Fund and bilateral external funders, but the prerequisite is that these requirements are prioritised by the ACP countries themselves.
Gender justice in trade policy: The gender effects of economic partnership agreements
One World Action: 2010
This study provides the first detailed economy-wide analysis of the likely gender effects of economic partnership agreements (EPAs) based on the goods tariff liberalisation schedules agreed by Tanzania, Mozambique and Jamaica. The study found that the employment and production effects of trade liberalisation on women will depend on the extent to which women are employed in the sectors sensitive to import competition, but most importantly, their ability to relocate to an expanding sector of production. It predicts that, under an EPA, women’s employment is likely to be minimally affected in Jamaica, Mozambique and Tanzania. Findings suggest that the consumption effect of trade may be regressive: imports, such as washing machines in Mozambique or gas cookers in Tanzania, will most likely benefit the wealthier, as they are not consumed by poorer households. For example, increasing availability of household appliances could reduce the workload of women with access to electricity, but only 7% of Mozambican households have access and an indirect effect could be a drop in demand for domestic workers, most of whom are women. The loss of government revenue from tariff removal constitutes the most immediate and significant impact, estimated at 2% of revenue, with too little time to compensate for lost revenue. The study urges that further monitoring of the implementation of trade liberalisation is required from a gender perspective. The gender-aware framework and analytical approach developed could be used to examine other EPAs and other trade agreements.
Latecomer development: Innovation and knowledge for economic growth
Oyelaran-Oyeyinka B and Sampath PG: Routledge, 2010
This book is based on a macro analysis of 79 countries and micro-surveys in different sectors and countries, spanning seven years. In it, the authors argue that rich countries have built strong institutions to complement to their production systems, which has allowed them to build up strong production and the exportation of high quality goods and services, a path followed by emerging economies. However, poor countries continued to produce raw materials for the richer countries. Central to the production activities of all countries that became rich is a set of industrial and innovation policies, which are discussed in the book. ‘Latecomer countries’ are defined as countries that are late in developing, and which do not innovate at the 'global frontier,' which is occupied by the top industrialised countries. They need industrial and innovation policies that shift attention from commodities to development of productive capacities. Innovation is not research and development, it is about knowledge that countries acquire, according to the book.
Mercury exposure in a low-income community in South Africa
Oosthuizen MA, John J and Somerset V: South African Medical Journal, 100(6): 366–371, June 2010
This study aimed to establish whether a specific community in a gold mining area, with potentially associated small-scale gold mining activities, was exposed to mercury. Thirty respondents completed a questionnaire and mercury levels were determined in 28 urine and 20 blood samples of these respondents. Three (15%) of the blood samples exceeded the guideline for individuals who are not occupationally exposed, while 14 (50%) of the urine samples exceeded the guideline for mercury in urine for those not exposed occupationally. The cause of these elevated levels is unknown, as only 20% of respondents indicated that they used coal as an energy carrier. Furthermore, nobody from the community was reportedly formally employed in a goldmine. Nineteen (63%) respondents consumed locally caught fish, while 20 (67%) drank water from a river. The study concluded that some individuals in this study may be occupationally exposed to mercury through small-scale gold mining activities. As primary health facilities will be the first point of entry for individuals experiencing symptoms of mercury poisoning, South African primary health care workers need to take cognisance of mercury exposure as a possible cause of neurological symptoms in patients.
One Millennium Development Goal that can be achieved now: Market access for the poorest countries
Elliott KA: Trade Negotiations Insights 9(5), June 2010
This article outlines how trade preference programmes can be made more effective for low income countries. It is based on five principles put forward by the Center for Global Development (CGD) to make trade preferences more effective for less-developed countries: expand coverage to all exports from all least developed countries; relax restrictive rules of origin; make trade preference programmes permanent and predictable; promote co-operation between countries giving and receiving preferences; and encourage advanced developing countries to implement trade preference programmes that adopt the other four principles. It argues that extending full duty-free, quota-free market access to all least developed countries would have far more power if it is a project of the G-20, not just the G-8, and Brazil, China, India and Turkey are already showing the way. The author urges the G-20 to show its leadership on global development issues and to realise the Millennium Development Goal of using trade as a tool for development.
Our common strategic interests: Africa's role in the post-G8 world
Cargill T: Chatham House, June 2010
The author argues that global players that develop greater diplomatic and trade relations with African states will be greatly advantaged. For many countries, particularly those that have framed their relations with Africa largely in humanitarian terms, this is argued to require a shift in public and policy perceptions. Without this shift, many of Africa's traditional partners, especially in Europe and North America, will lose global influence and trade advantages to the emerging powers in Asia, Africa and South America. The author argues that economic fortunes across Africa are diverging, making it less meaningful to treat Africa as a single entity in international economic negotiations. He claims that it is in the global interest that the African Union should be granted a permanent place at the G20 and that in turn, a more focused, sophisticated and strategic African leadership is needed.
Reconsidering regional integration in sub-Saharan Africa
McCarthy C: Tralac and Danida, 2010
This paper explores regional integration in Africa. The author observes that fragmentation of countries has led to the absence of scale in the production of goods and services. Industrialisation and regional integration policies were proposed to overcome this. For some communities, such as the Southern African Development Communities, there were also political objectives. None of the regional integration arrangements are yet fully fledged customs unions. The author notes the limits to intraregional trade by virtue of the low industrial capacity of the countries in the region. However regional integration provides in theory the economies of scale that attract investment and protects producers within a common market. He argues that these benefits of regional integration have not been achieved. As regional integration is argued to be important, the author argues that it needs to be more strongly based on national strategies for enhancing production capacities.
Regional economic outlook: Sub-Saharan Africa: Back to high growth?
International Monetary Fund: April 2010
According to this report, the current economic slowdown in sub-Saharan Africa may soon be over. Output is projected to expand by 4¾% in 2010, compared to 2% in 2009. Most countries in the region are now bouncing back from the growth slowdown or contraction in output experienced during the global recession. The brevity of the slowdown owes much to the relative strength of the region’s economies heading into 2008–2009, the expansionary macro-economic stance then adopted by most countries, and the relatively quick recovery in global economic activity. The report predicts that prospects for 2011 and beyond look good. Output growth is projected to accelerate to 5¾% in 2011, playing off the expected continued improvement in global economic conditions. Over the medium term, growth rates in most sub-Saharan African countries are expected to be only marginally below those enjoyed in the mid-2000s. In the meantime, most countries have been able to shield pro-poor and pro-growth public spending. According to preliminary budget out-turn numbers, health and education spending increased in real terms in 20 of the 29 low-income countries in the region in 2009. In a similar vein, government capital spending also looks to have held up in 2009, increasing in real terms in more than half of the countries in the region.
Supporting regional integration in east and southern Africa
McCarthy C, Cronjé JB, Denner W, Fundira T, Mwanza W, Bursvik E: Trade Law Centre for Southern Africa and the Royal Danish Embassy, 2010
This collection of papers reviews select issues on the regional integration agenda in east and southern Africa. It starts by assessing the African Paradigm of Regional Integration, as well as the broader AU integration agenda. It also reflects on the impact of the global economic crisis on Africa. This is followed by a review of progress on regional integration in the Southern African Development Community (SADC). It then considers country-specific issues, including the trade policy choices of several countries, the role of new generation trade issues, such as services on the regional integration agenda, and assesses the status of protectionism, trade remedies and safeguards in regional trade agreements, both intra- and extra-regional. Finally, it presents a review of the developments in the negotiations concerning SADC’s economic partnership agreements, specifically focusing on concerns raised within the SADC group.