Africa’s ‘America’ resists an EU trade deal
South African journalist, Hans Pienaar, gives his view of why South Africa is resisting an Economic Partnership Agreement (EPA) with the EU.
Port Elizabeth (South Africa).
South Africa is now regarded by many Africans as the continent’s ‘America’. Its much more efficient enterprises tend to take over large market shares and push out the competition – almost acting like a colonial power itself.
On the other hand, South Africa has become the voice of Africa on the international stage, especially under a former president, Thabo Mbeki, who was the driving force behind a number of pan-African institutions since the launch of the African Union (AU) in 2000. South Africa’s ruling party still views the West as not having South Africa’s best interests at heart. This split personality – of being a relatively ‘rich’country, and a champion of poor blacks – has come to the fore in talks over EPAs between EU and ACP states.
The EPAs gathered urgency towards the end of 2007 when the maintenance of preferential treatment given to ACP states was no longer allowed under World Trade Organisation (WTO) rules. On the EU’s initiative, EPAs were offered under the Cotonou Agreement (2000-2020). In Africa, several interim ‘EPAs’ were initialled ¬– not signed – to avoid lawsuits under WTO rules. In southern Africa, nine of the 15 members of the Southern African Development Community (SADC) have done so, threatening to scuttle regional integration, one of the cornerstones of SA’s ‘black champion’ foreign policies.
But with the EU being SA’s largest trading partner since colonial times, SA already has its own trade agreement with the EU, which is periodically renegotiated. In 2007, it also entered into a Strategic Partnership Agreement with the EU, one of only a handful of countries to have done so.
Talks over an EPA to possibly replace the current SA-EU trade agreement when it matures in 2012 have been stalling on both fronts. As a potential competitor with the EU in its own African backyard, it is nervous, especially over the future of its services sectors. In banking, for instance, bank charges are much higher in SA than Europe, and would therefore be uncompetitive outside SA. The introduction of trade policies as required by the draft EPAs would entail phasing out tariffs. But most African governments, with their inefficient tax structures, are vitally dependent on tariffs, both above and under the table, as their main source of income. South Africa wants a common external tariff for the whole region, administered under an enlarged South African Customs Union (SACU), one of the key building blocks and stages of southern Africa economic integration, which it hopes would in turn be a model for integration on the rest of the continent.
During a ministerial troika meeting in January 2009, both sides agreed that integration around SACU should be a key focal point in future negotiations. But the EU has since recorded its intention to forge ahead with an EPA with Botswana, Lesotho, Namibia and Swaziland (the BLNS countries) plus Angola and Mozambique – but without South Africa.
