By Patricia Handley and Yash Tandon
CAPE TOWN, Apr 8 2010 (IPS)

The current course of the talks on economic partnership agreements (EPAs) is particularly destructive for low income African countries and may contract democratic space in such countries even further.

So says Yash Tandon, Ugandan political economist and senior advisor to the South Centre intergovernmental think tank on developing countries in Geneva, Switzerland.

“I would say that small countries through the EPAs will lose all their independence and sovereignty. Political independence that they fought for 20, 30 years ago will be compromised,” Tandon told IPS during a visit to South Africa.

Q: How do the problems presented by the EPAs affect poorer countries in Africa? A: If you look at the sections which the smaller counties of Africa are being forced to sign with the EU, you find that some of these include issues that are already precluded by the World Trade Organisation (WTO).

In the WTO it is agreed that issues like competition policy, investment policy and government procurement – the so-called Singapore issues – are outside the WTO remit. But countries in Africa are being forced by the EU to negotiate these as part of the EPA.

The South Centre has carried out extensive analyses and found that including these issues will more or less erode any policy space on the part of the countries that sign the EPAs.

For example: government procurement deals with goods and services that the government provides as part of its obligations to the people. The government issues tenders for equipment in hospitals or schools and for services like refuge collection.

These are services that should of necessity be provided by the state but when you make these subjects of international negotiations and international treaty, you open up these services for international tender. Because European companies bring with them the power of money and influence, these services can be taken away from local companies.

Smaller countries don’t have the capacity to negotiate on equal terms with Europe. Look at Swaziland, Lesotho, Namibia and my own country of Uganda. Partly because of their size and their dependence on aid from European countries, they are very weak in the negotiations and the (resultant) effect on them is serious.

For one, they will lose policy space on matters related, for example, to industrialisation, agriculture and food security. The governments will not be able to make policies that are necessary for them to service their own people.

Secondly, in the present global economic crisis, these countries are likely to look to Europe and to the U.S. and the International Monetary Fund (IMF) for bailing them out. I hope they don’t do that because we do have alternatives.

But the present leadership in our countries is so psychologically attuned to getting aid from outside that they are likely to go to these very institutions. The effect will be even more serious than that of the World Bank’s structural adjustment programmes over the last 20 years.

Thirdly, the EPAs will undermine the democratic process within these countries because these countries will be accountable to the donors rather than to their own electorates.

Q: Why are EPAs an issue now? A: The EPAs have become urgent mainly because of the pressure put on us by the European Commission.

The EU is desperate to conclude an agreement with African countries because in the present period of trade liberalisation, combined with the global economic and financial crisis, there is an intense struggle for the markets and resources of the world.

Q: Since negotiations began in 2002, what has been achieved, considering the original intention to facilitate trade? A: The Europeans have not got it all their way. Eight years down the road there is some self-awareness and resistance building up in Africa. That said, there have been some negative developments already.

The European Commission has negotiated a comprehensive EPA with the Caribbean countries. This has weakened the stand and broken the unity of the ACP (African, Caribbean and Pacific) countries.

In Africa, there are some countries in ECOWAS (Economic Community of West African States), like Ghana and Ivory Coast, that have signed the interim agreement. This has fragmented ECOWAS, although big countries like Senegal and Nigeria are still standing strong.

East Africa has allowed itself to be persuaded to sign the interim agreement, which is tragic. In Southern Africa, four countries have signed the interim agreement but the others are holding out. So there is some hope there.

I am a bit more optimistic than many people. Why? Because even in the case of Botswana, Lesotho, Swaziland and Mozambique, there are still pending issues such as export tariffs. These are an important means of revenue for small countries and of securing control over national resources for local processing with added value.

The other extremely important issue is the most favoured nation clause. There is no reason why we need to sign an MFN clause. Under the WTO rules, it is possible for the South to carry out their own trade without such concessions to the North. That is quite legitimate and legal.

There is no reason why our countries should not be able to sign agreements with other countries in the South without offering them to the EU.

Q: Your 2008 book is entitled “Ending Aid Dependence”. Can Africa escape the trap of aid? A: Most of our countries in Africa have become so donor-dependent for their development that they have sacrificed policy space in return for money.

One has to look into the budgetary systems in our countries and ask, why are there deficits? Once this exercise is carried out, there is no reason why any country in Africa should be short on budget.

Not only can we liberate ourselves from aid and do away with it, but it is obligatory that we do so.

Q: Including the low income nations? A: Especially the low income countries of Africa. I don’t mean we can do it at the snap of a finger. In my book I propose a seven-step strategy, beginning with ending our psychological dependence on aid.

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By Patricia Handley and Yash Tandon
CAPE TOWN, Mar 29 2010 (IPS)

Respected Ugandan political economist Yash Tandon has added his voice to the call for a moratorium on the negotiations between African countries and the European Union (EU) on the trade deals known as economic partnership agreements (EPAs).

Yash Tandon: African countries should first create their own regional common market before opening to the EU and others. Credit:

Tandon now works as senior advisor to the Geneva-based South Centre intergovernmental think tank for developing countries after serving as the centre’s executive director.

He visited Cape Town as speaker at the 86th Harold Wolpe Memorial Trust Open Dialogue where he described the situation with the EPA talks as “a turning point for Africa”.

Q: What do you mean by the destructive course of the EPAs? A: The EPAs are driven mostly by European interests. It is an asymmetrical negotiation … driven mainly by considerations of power exercised by the EU and by weak African governments that are dependent on economic aid from Europe and access to markets in Europe. It’s a very unequal relationship.

Secondly, the effect of the negotiations at the moment is total fragmentation of Africa. One example: in Southern Africa, South Africa has refused to sign the interim EPA but it has been signed by Botswana, Lesotho, Swaziland and Mozambique.

These countries will be able to import products from Europe which could then, through the Southern African Customs Union (SACU), find entry into South Africa.

South Africa could take action to prevent this but (such action) will dismantle SACU. I hope that South Africa does not do it because it (will) simply implement what the Europeans want. The Europeans want to divide and conquer Africa.

The second example is that countries like Zambia and Zimbabwe, which were the founding members of the Southern African Development Community (SADC), are not even part of the negotiations with Europe within the SADC framework.

They are negotiating within the East African (bloc). Here, again, is the breakdown of SADC and creation of a new bloc including Zimbabwe and Zambia that is different from the regional groupings that Africans had agreed to in the Abuja Treaty.

Q: What is the alternative? A: We must do this in two steps. First, we must put an embargo on negotiations with the EU until we have our house in order. As long as the EU goes on putting pressure on us and forcing individual countries to sign separately, we cannot even think of an alternative. We have time. Europe does not have time.

Then I suggest that the heads of state of SADC and East African countries meet for half a day and mandate their trade ministers to negotiate a COMESA (Common Market for Eastern and Southern Africa)-like customs union that should include COMESA, SADC and the East African Community to begin putting in place what they had agreed in 2008.

They should lay out a time-scale (for harmonising) their customs tariffs and complex issues like rules of origin, facilitation of trade and transportation and information networks.

This will take time but they should work out agreements on these issues in order that these countries first drop barriers to trade and investments and movement of people amongst themselves before they open up to the outside world. And by outside world I mean also China, India, Brazil and the U.S.

Our parliaments must take their responsibility seriously. None of the parliaments in our countries is sufficiently aware of what is happening.

How ironical that our parliamentarians can spend a lot of time talking on local issues but are oblivious to issues of a global nature that can have serious and irrevocable – except at great cost – consequences for our countries and the region.

The committees in parliaments that look at trade and treaty issues should compel our executives to put these treaties before parliaments to be fully debated, in view of the public and the media, in order for them to understand what the implications are.

And if they think that the implications are negative for our people, as in fact is the case, they should refuse to ratify these.

Q: What is the feasibility of your alternative? A: It depends on the political will of the leadership and the extent to which they can be pressurised by the people and those economic interests that will be hurt by the EPA. It’s a political question.

In our countries there are export-sector interests that want to enter into EPAs because they want access to the European market.

But (small and medium industries and businesses) will lose out: small clothing firms; firms that provide food domestically; small manufacturing sectors that produce goods and services for the local, domestic or regional market.

These firms are not so much involved in the negotiations and are unaware that they will be hurt very badly if we open up markets to Europe.

It is feasible to reverse the situation provided three things happen. First, provided there is political will on the part of our leadership. Second, provided our people and parliaments are able to pressurise our governments to be sensitive to the domestic needs of our countries.

Third, provided those commercial and business interests in our countries that depend on the domestic and regional market are mobilised to put their case, as opposed to the case of the export-oriented industries.

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By - - and Yash Tandon
GENEVA, Jul 29 2008 (IPS)

(IPS/South Centre) The last G8 summit (Hokkaido, Japan,July 7-9) sat in judgment over the democratic credentials of the government of Zimbabwe, but it had itself no legitimacy. The G8 had no choice but to bring the matter to the Security Council of the UN. And there the West lost: China and Russia vetoed, writes Yash Tandon, Executive Director of the South Centre, Geneva. The G8 is no longer even the seat of the powerful. It is a club of the six richest Western countries -France, Germany, Italy, United Kingdom, United States and Canada, plus one rich Asian country (Japan), plus nearly rich Russia, a former Communist country that was admitted in 1998, but still sits, uncomfortably, in the margins of G7. As it turned out, the so-called G5 developing nations (Brazil, China, India, Mexico and South Africa) that were invited to Hokkaido as observers, declared that they had no particular appetite for a pre-cooked dinner in which they had no hand in preparing. They constituted themselves into the coalition of the unwilling, and issued their own Political Declaration. On the matter of climate change, for example, they placed targets for the developed countries, calling for quantified emission targets for these countries under the Kyoto Protocol after 2012, \”of at least 25-40 per cent below 1990 levels by 2020 and by 2050, by between 80 and 95 per cent below those levels, with comparability of efforts among them\”. What is needed is a radical reform of the Security Council of the UN, not a patch-up job of the G8 that should, by now, dissolve itself. It does not constitute the international community that it thinks it does.

Recently, for example, the people of Ireland decided by referendum, that contrary to the will of their government, they did not want to surrender their sovereignty to some supranational body called the European Union. What the Irish vote showed was that the democratically expressed will of the people is the ultimate test of the legitimacy of any institution that seeks to make decisions on behalf of the people.

Of course the international domain is different from the national. There is no World Parliament of Peoples. The nearest we have to a peoples assembly is the United Nations. The UN, however, is a cleverly devised global body based on an adroit balance between power (the Security Council with big power veto) and the voice of the people (the General Assembly, where this voice is presumably articulated through governments). This is the UN ultimate legitimacy test; does it properly balance the power of the mighty with the voice of the worlds people?

Fifty years after its formation, the General Assembly has more or less kept up with its representative character. It has, for example, absorbed all the new nations arising out of colonial past and given them an equal voice in the Assembly. It still enjoys some legitimacy. But the Security Council has lost its legitimacy; it no longer reflects the new reality of power. The exercise by the United States, the United Kingdom and France of a triple veto of the Western nations whilst keeping out countries like India and Brazil does not make sense any longer. Nonetheless, as long as the Security Council does not reform, it is the body that decides, for example, whether or not the internal situation in Zimbabwe constitutes a threat to international security.

The UN is a rule-based institution, even if the rules are now applied by an anachronistic Security Council. The G8, on the other hand, has no legitimacy whatsoever. It has the power of its mighty, but it does not have the voice of the people. The G8 is a self-selected club of the Rich and Powerful. Nobody ever gave it the mandate or authority to decide on matters of economy, climate change, security, or to impose sanctions on states that do not bend to their will.

The last G8 summit (Hokkaido, Japan,July 7-9) sat in judgment over the democratic credentials of the government of Zimbabwe, but it had itself no legitimacy. The G8 had no choice but to bring the matter to the Security Council of the UN. And there the West lost: China and Russia vetoed.

The G8 is no longer even the seat of the powerful. It is a club of the six richest Western countries -France, Germany, Italy, United Kingdom, United States and Canada, plus one rich Asian country (Japan), plus nearly rich Russia, a former Communist country that was admitted in 1998, but still sits, uncomfortably, in the margins of G7.

As it turned out, the so-called G5 developing nations (Brazil, China, India, Mexico and South Africa) that were invited to Hokkaido as observers, declared that they had no particular appetite for a pre-cooked dinner in which they had no hand in preparing. They constituted themselves into the coalition of the unwilling, and issued their own Political Declaration. On the matter of climate change, for example, they placed targets for the developed countries, calling for quantified emission targets for these countries under the Kyoto Protocol after 2012, “of at least 25-40 per cent below 1990 levels by 2020 and by 2050, by between 80 and 95 per cent below those levels, with comparability of efforts among them”.

The G8 missed the wisdom of the voice of the South by shortsightedly presuming to co-opt the Big Five in a preordained agenda. They thought that if they finally got the US on board on climate change, the G5 would also rejoice. They were creating grounds for their own disappointment.

They thought that if they put the President of South Africa in a corner in Hokkaido and press on him to give the G8 the legitimacy it lacked to impose sanctions on Zimbabwe, they would be able to reverse the decision of the African Union (AU) taken the previous week at Sharm al Shaikh. They did not realise that with all its weaknesses the AU has more legitimacy than the G8.

What is needed is a radical reform of the Security Council of the UN, not a patch-up job of the G8 that should, by now, dissolve itself. It does not constitute the international community that it thinks it does. .(END/COPYRIGHT IPS/SOUTH CENTRE)

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By - - and Yash Tandon
GENEVA, May 12 2008 (IPS)

(IPS/South Centre) There is much to celebrate in the growth and development of the South in recent years, from the ability of certain Latin American countries to avoid dependence on the North to the growth of the economies of certain Asian countries whose increasing sovereign wealth is now being tapped to bail out distressed banks in the North. While there are signs of growth in Africa too, the continent is worse off than the rest of the South, writes Yash Tandon, Executive Director of the South Centre. In this article, Tandon writes that the Millennium Development Goals (MDGs) are not being met, especially in sub-Saharan Africa, where at the current rate universal access to a minimum set of social services will only be achieved in 2108, almost a hundred years later than the target date of 2015 set by the MDGs. The risks of not acting are grim. We may witness increasing misallocation of global resources, a growing financialisation of the economy and greater risk of systemic collapse, an increase in what is most accurately described as a recolonisation of Africa by welfare and aid agencies, and increasing migration from the South to the North, and within the South from the poor to the rich countries, as a response to economic distress arising from marginalization and climate change.

Despite this progress, however, the Millennium Development Goals (MDGs) are not being met, especially in sub-Saharan Africa, where at the current rate universal access to a minimum set of social services will only be achieved in 2108, almost a hundred years later than the target date of 2015 set by the MDGs.

Africa is still heavily dependent on aid from the North, which makes the continent hostage to policy priorities decided by the donor community and the dominant institutions of global economic and financial governance.

Hunger continues to stalk the South, and especially in Africa, which has gone from being a food self-reliant continent to a net food importer.

In many parts of the South, and not just in Africa, the prospect of industrialisation has receded. Indeed the last twenty years have seen a de-industrialisation and now even deagriculturalisation of many parts of the South.

At the systemic level, despite strenuous efforts by the countries of the South to reform the United Nations system to advance equitable development, the process is being subverted by powerful vested interests that will not allow even modest alignment of, for example, the Security Council to reflect the present-day geopolitical reality.

The increasing out-datedness and irrelevance of the International Monetary Fund (IMF) and the World Bank to today’s development challenges is clear, but the reforms undertaken in recent weeks to the system (the voting formula in the IMF, for example) do not address the fundamental problems of the precariousness of the global financial architecture.

The Doha Development Agenda of the World Trade Organization is not living up to its name as a new resurgence of neo-mercantilism and protectionism from the North subvert fair trade principles and decrease trade policy space for the South.

The World Intellectual Property Organization (WIPO) has made some progress in introducing a developmental dimension to the agenda. Yet the implementation of that agenda is facing powerful opposition, and the whole system of production and dissemination of knowledge that is the basis of innovation and technology remains hobbled by monopolistic practices of global corporations.

Finally, we cannot forget the overarching challenges to sustainable development that climate change poses, including to food security and sovereignty, livelihoods, and in many cases outright survival. Developing countries will be adversely affected the most by climate change, yet the South needs support from the North for adaptation, financing, and technology sharing under the UN Climate Change Convention and the North’s responsibility to effectively mitigate the emissions that contribute to climate change continue to be unfulfilled.

At the systemic level there are still many formidable obstacles to change towards a more equitable and just world, which requires urgent collective action by the global community:

– The three pillars set by the UN reform process — security, development, and human rights — are interdependent; none can be sacrificed for the others.

-MDGs are not simply a numbers game. The statistization and monetization of MDGs mask systemic and structural malaise behind these issues and divert attention from them. What led to the MDGs was the development failure in 1990s. That condition has not changed.

-The Washington Consensus is dead, and therefore there is need for fresh thinking on development and financial architecture.

-Aid and charity are the wrong way towards addressing systemic and developmental issues, especially of Africa.

-The United Nations, imperfect as it is, is nonetheless the only truly global intergovernmental system we have, and we need therefore to work through it.

The risks of not acting are grim. We may witness increasing misallocation of global resources, arising out of a growing tendency on the part of global corporations to put profit before development and the environment. We may witness an increasing financialisation of the economy and greater risk of systemic collapse. The subprime mortgage crisis is deeper than it appears on the surface and is still continuing, and there is a huge dislocation between the real values of assets and their collaterised prices. There may be an increase in what is most accurately described as a recolonisation of Africa by welfare and aid agencies. And we may witness increasing migration from the South to the North, and within the South from the poor to the rich countries, as a response to economic distress arising from marginalization and climate change.(END/COPYRIGHT IPS/SOUTH CENTRE)

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