Market Access for Trade in Goods & Competition Policy in EPAs

Market Access for Trade in Goods in EPAs provides an overview of the market access provisions in the initialled deals.

From the Conclusion:
The scope and extend of liberalisation of trade in goods under the EPAs is unprecedented for ACP governments, highlighting the WTO-plus aspects of EPAs, even with relation to the core provisions regulating trade in goods. These agreements will entail major challenges, both for governments implementing the EPA required reforms and for the private sector trying to adjust to new competition conditions. The capacity of current EPA texts, either interim or comprehensive in the case of the Caribbean region, to yield the objectives intended depend, however, on several variables outside the scope of these texts.

For instance, the improvement of the terms of EU-ACP through economic diversification and a higher value addition of exports depend on the capacity of the private sector to innovate towards new segments of the value chain, which in turn requires ACP governments to enact supporting policies. Similarly, the capacity of firms to utilise greater competition from European products to modernise and gain competitiveness also depends on the availability of finance, workers retraining and skills development, and governmental incentives.

Because of the importance of accompanying measures, including technical and financial assistance, in promoting the realisation of EPA objectives, it is unfortunate that the focus of current EPA texts is on binding market opening, not on equivalent binding assistance provisions.

Competition Policy in EPAs analyses the competition policy provision from the Cariforum text.

From the conclusion:
The inclusion of a competition chapter in the EPAs, together with chapters on other trade-related issues, remains one of the most sensitive and divisive issues in these negotiations. Regions and countries that have not initialled an interim agreement yet have generally maintained their resistance to even discuss the matter or alternatively, have stated their firm intention to negotiate only provisions leading to greater cooperation on these issues.

That prudence seems to be justified given the fact that the interests regarding the promotion of competition differ widely in the EU and in ACP countries because of their enormous economic and productive asymmetries. The EC would very likely refuse, for systemic reasons, to accept an EPA competition chapter which reaffirms the right of developing countries to use competition policy as a developmental instrument (selective or lax enforcement of anti-concentration rules). Moreover, developing country competition policies which actively promote local industries and services suppliers to the detriment of imports of foreign suppliers would actually run frontally against the European interest of tightening competition regulations to improve the conditions of market access for its nationals.

Because many other development policy instruments are severely limited either by WTO Rules or by the EPAs (for instance, tariff policy, export taxes, intellectual property, and government procurement), ACP negotiators should avoid adding competition rules to the lsit of instruments their governments will no longer be able to use in a pro-active manner to foster their development.