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| Finance Minister of Ghana, Seth Tekper |
Mr. Seth Terkper, Minister for Finance is
exploring the possibility of limiting imports of foreign good and promoting the
manufacture of local substitutes.
Sources close to the
Ministry of Finance say that the Ministry of Finance say that the Minister is
under firm instructions from President John Dramani Mahama to resolve the
balance of payment difficulties of Ghanaians economy.Mr. Terkper has also set
up a small group of experts to look at how to maximize tax revenue without over
burdening the Ghanaian tax payer.
Interestingly, the biggest obstacle to
maximinsing tax revenue is the Economic Partnership Agreement (EPA) with the
European Union.
A Policy brief
prepared by the Third World Network (TWM) predicts that Ghana would lose as
much as $97 million in revenue by 2022 if
Ghana signs up to the EPA.
The policy brief is published below;
INTRODUCTION
Negotiations
between the European Union and different regional groupings in Africa (as well
as the Caribbean and the Pacific) on Economic Partnership Agreements to replace
the preferential trade regime under the Cotonou Agreement were meant to be
concluded in December, 2007. As a result
of severe differences between all the African regional groupings (ECOWAS, SADC,
CEMAC, ESA) and the EU, the deadline could not be met, and a decision was
agreed by all sides to extend the
negotiations further into 2008.
However, in
order to ensure that the exports of African countries continued to enjoy the
duty-free access to the European market that they had under the Cotonou
Agreement, African countries requested that the EU apply for an extension of
the WTO waiver. For ECOWAS, this
decision was a collective regional position adopted at the highest levels of
political leadership in the negotiations.
Civil society
organisations and individual experts put forward an alternative proposals in
case the EU found the waiver route unacceptable. For the developing country members of Africa,
the groups recommended that the EU extend to the African countries a scheme
that the EU had in place in for many other economies in Latin America, the
so-called GSP+; and for the Least developed country members, a scheme which the
EU has already bound itself to provide, the Everything But Arms (EBA).
The EU refused
both options, and (contrary to the accepted understanding that EPAs were to be
negotiated regionally) proceeded to negotiate Interim Economic Partnership
Agreements (IEPAs) with individual countries.
Of the three developing country members of West Africa, Ghana and Cote d’Ivoire
negotiated these agreements; Nigeria refused.
On December, 13
2007 Ghana and the EU INITIALLED
what they called a “stepping stone” Economic Partnership Agreement, which they
expected to SIGN by 30th
June, 2008. The deadline was not met in
2008, and the EU is now putting pressure for this to be done as soon as
possible this year. At the same time,
the full comprehensive EPA negotiations with the whole of ECOWAS is on-going,
and the parties hope to finish by June this year. Most people believe this expectation is not
realistic. Thus the pressure by the EU
on Ghana to SIGN AND RATIFY soon is immense.
However, all
the analyses carried out by a range of sources – from civil society to trade
professionals and academics – strongly converge on the view that the interim
agreement is not in Ghana’s overall interests, and in some cases, the terms are
even worse than similar agreements between the EU and other countries like
Kenya which share Ghana’s economic developmental challenges.
The agreement
not only commits Ghana to liberalise an overwhelming proportion of its imports
from the EU -- in the absence of a clear
basis for deciding how and which sectors of the economy will perform under this
situation; without clarity as to how even the
stated objectives of the IEPAs can be met by Ghana; and with provisions
which go way beyond the proclaimed objectives of the IEPAs.
In addition, on
the issues that remain to be negotiated at ECOWAS level, the agreement commits
the Government to an approach which is biased towards the European Union. These
are issues of negotiation which are still controversial, and which do not lie
in the hands of Ghana alone, but with the entire West Africa region.
Thus, signature
of the agreement will commit Government to an overall trade and development
policy which is negative to the overall interest of Ghana, both nationally and
within the West African region.
II.
LIBERALISATION OF TRADE IN GOODS
Elimination
of Customs Duties [Article 13 and annexes]
With regards to
trade in goods, the interim agreement commits Ghana to eliminate tariffs on 80%
of goods imported from European Union. Bearing in mind that 40% of all Ghana’s
world-wide imports has come from Europe, the implications of this level of
liberalisation are staggering. This will substantially reduce the revenue that government
earns from duty charged on imports from the EU, resulting potentially in budget
deficit and thus affecting resource allocation to social sectors such as
education and health.
In addition,
the elimination of duty will lead to the collapse domestic infant industry
which compete with cheap and heavily subsidized imports from the EU. Many authoritative studies, including by the
World Bank have concluded the highest level of liberalisation of trade with the
EU that countries like Ghana withstand without collapsing their industries and
local production is 60%
The Agreement
contains a schedule of liberalisation by which tariffs are eliminated on some
products by 2013, others by 2017, and still others by 2022. A final set of product will only be
liberalised after 25 years. This schedule
can be more damaging that appears on the surface, especially because the
agreement makes no provision for future
modification of the tariffs.
Indicative but respectable studies have
calculated the revenue loss to Ghana at $97 million by 2022. About 29% of this amount will be lost in the
first six years of implementation of the agreement. As one study has found out, countries like Ghana
may find it difficult, if not impossible to compensate for this tariff-related
revenue loss by other means.
Comparison of Ghana’s commitments with other
countries is instructive. For instance, Ghana
will liberalise over 70% of all imports from the EU within 10 years, and this
will reach 80% of trade by 2022. This is
an adjustment period of 15 years. This
contrasts to the 25 year adjustment period in the case of Kenya (and other
regions) where the liberalisation will not be completed until 2033. Moreover, the tariffs on the first tranche of
Kenyan products are all zero. This means
that real cuts in tariff will only start
from 2015.
In effect, Ghana will have liberalised 71% of
its imports from Europe at a point when Kenya is only just three years into
making real tariff cuts. After a further six years, Kenya will only have
liberalised 39% of imports. Furthermore, the nominal rate of protection for
excluded products is significantly higher in Kenya than Ghana, with average
(trade-weighted) tariffs set at 26.6% in Kenya and only 16% in Ghana.
Sensitive Products
By demanding the liberalisation of 80% of
European imports to Ghana, the EU has argued, and Ghana seems to have accepted,
that the 20% of the trade that is not liberalised will be sufficient to protect
vulnerable sectors – i.e. the so-called sensitive list. However, the adequacy of this protection is severely
in doubt. Preliminary studies for the
agricultural sector has indicated that about 60% of that sector alone need to
be protected from liberalisation. Thus
the 20% may not be sufficient for the entire domestic sector, agricultural and
industrial
Looking at the initial list[*]
of sensitive products submitted by Ghana, the very concept of ‘sensitive
products’ is severely undermined by the inclusion in the list of a large number
of goods (about 40%) on which the current tariff is set at zero or at rates
below 10 percent. From revenue
perspectives, it is not clear why these are included in the sensitive
list. It is even more unjustifiable
because the Ghana IEPA includes a standstill clause which, unlike IEPAs signed
by other countries, covers the sensitive list.
That is to say Ghana has
committed itself not to raise tariffs on the sensitive products. Thus, those products on the list for which
tariff is set at zero will never enjoy any tariff protection in the future
since tariffs cannot be raised on them.
In which case is in unclear what benefit these products enjoy by being
put on the sensitive list.
This goes to confirm the concern raised by civil
society and many trade experts that the definition and selection of the sensitive
products seems to have been done in haste, so that what emerged as a result is
not well co-related with the economic imperatives of Ghana or its developmental
policy objectives.
Taking as a further instance the composition of the
products on the list. While some products on the list -- such as cotton,
textiles, and apparel, as well as plastics and by products of the petroleum
industry -- make sense from the point of view of Ghana’s industrialisation
policy objectives, others do not. In
particular there are some items that are not exported by the European Union in
significant quantities to Ghana.
Examples of this include: ‘edible fruits and nuts’ (which account for
2.5% of tariff lines on the exclusion list even though they only accounted for
0.006% of imports from the EU in 2007; ‘raw skins and hides’ account for 1.6%
of tariff lines on the exclusion list even though they comprised only 0.008% of
imports from the EU in 2007.
The intention may be to protect vulnerable
agricultural sectors. But in actual
fact, the inclusion of such products where European competition does not pose a
threat to existing or potential sectors only serves to use up space that could
have been used to protect other products subject to real competition.
Standstill
Clause [Article 15, IEPA]
Like all the interim agreements, Ghana’s IEPA
agreement includes a standstill clause, by reason of which no new custom duty
on imports from the EU can be introduced and those currently applied can not be
increased. But Ghana’s clause is draconian in its restrictiveness. Unlike say the SADC or the Pacific IEPAs
where the clause applies only that portion of the trade meant to be liberalised,
Ghana’s standstill clause extends to the so-called sensitive list, the category
of goods not meant to be liberalised. As
argued above, this undermines the very use of the sensitive product.
Moreover, by agreeing to such a restrictive
standstill clause, Ghana has unnecessarily given up its rights under the WTO
(GATT article XXIV) which expects commitments in relation to only that (substantially all) portion of trade that
is liberalised.
Elimination of
export taxes [Article 18, IEPA]
Another unnecessary but damaging concession made
by Ghana in the IEPA is the commitment to give up its right to charge duties on
exports. According to the agreement, the
Government will not introduce new export duties, nor will it raise the current
ones to a higher level. This can only be
varied in emergency conditions, after consulting the EC. Thus the Government has given up a policy
which governments all over the developing world, including Ghana, use when
necessary to discourage the excessive export of locally produced materials in
their raw form, so as to encourage value-added processing and export.
For instance, at the moment Ghana has export
duty on scrap metal, to discourage export of this, and make it available to the
local capital goods sector, especially technology produced in the informal
sector for the poor in agriculture.
The wide-ranging beneficial use to which a
policy on export taxes can be put is demonstrated by such examples as that of South
Africa, where it is crucial to value addition in mining (through
beneficiation); in Kenya where it is important for the shoe industry. Ghana’s
own contemplation of value addition in areas of mining, the timber industry and
other areas stand to suffer from the loss of this policy tool.
And yet elimination of export taxes was never
part of the EPA agenda. Nor is it called
for under WTO – where the EC has failed in its demands to change the rules.
Rules of Origin
[Article 14, IEPA]
Rules of Origin
(RoO) are critical to how much of the access to the European market promised to
the Ghanaian exporters can actually be realised, since they determines which
goods can qualify as originating from Ghana. The EU’s RoO have been stringent
under the generalized system of preferences (GSP) and the EU has been promising
flexible ones under the EPA. Some of
this promised flexibility has materialised such as the single transformation
provisions in relation to textiles.
At the same
time, however, the IEPA has introduced new difficulties. For instance, new rules allow cumulation with
only countries that have also signed IEPAs.
Thus in the West African region, Ghana can only cumulate with Cote
d’Ivoire. This means that Ghanaian
exporters of products which were made using inputs from other West African
countries like Togo or Nigeria will have more difficulty enjoying the benefits
of market access under the IEPAs. Ghanaians may not for instance use tuna
caught from Togo to produce canned tuna for export to the EU
This could
create a difficulty not only for current production, but especially for future
economic development, especially industrialisation prospects in which Ghana can
rely on the economies of the neighbours.
There are many
areas where the rules of origin could be improved. For instance in the area of fish (very important
for Ghana), the relaxations introduced under the IEPAs have not changed the
overly stringent EU provisions, and this could be changed to allow fish caught
in the Ghana’s Exclusive Economic Zone to more readily access EU market.
These and other
changes depends upon Ghana undertaking detailed study of its needs and
potentials, and of the specific rules of origins problems it faces. As such
detailed information does not exist, it is difficult to argue for the kind of required
changes which will enable Ghanaian exporters take advantage of the kind of
benefits touted under the (I)EPAs.
Unless improved, the (I)EPAs benefits will thus remain dreams, which
will be dearly paid for with disruptions in the business of domestic producers,
most of whom don’t even export to Europe.
Most Favoured
Nation Treatment [Article 17, IEPA]
Another
difficulty with the interim agreement is that it commits Ghana to extend to the
EU any more favourable treatment applicable as Ghana becomes party to any free
trade agreement with any major trading partners, defined in such a way as to
include China, Brazil, and India. This has the potential of negatively affect
whatever south-south co-operation is possible between Ghana and such countries
like Brazil and India, since whatever better concessions Ghana makes to such
countries must automatically be extended to the EU. This will undermine Ghana’s urgent need to
diversify trading partners, which has become even more crucial in the current
global crisis. All the efforts by past
governments and intentions of the current government to develop trading
relations with India, China, Brazil thus stand in jeopardy.
Of course, in
the Ghana IEPA, the MFN requirements are extended to Ghana as well, that is to
say Ghana will also enjoy other concessions that the EU extends to other
parties. But this is pyrrhic: Ghana
already enjoys 100 percent entry to the EU market, and the EU is keen to
exclude other areas of potential benefit like rules of origin from MFN benefit.
Again, the MFN
clause is not a requirement for WTO compatibility and thus can simply be
excluded from both the interim and the final EPA.
Development
Support
While the
European Commission and EU member states have said they would provide funds towards
compensating loses attendant upon the EPAs, there is no certainty that such
amount will be sufficient to cover the loss and now even more uncertain in the
midst of the global crises. The EU has
not been forthcoming with actual figures.
In 2005, at the World Trade Organization Ministerial the EU promised an
increase of €2 billion as Aid for Trade. However, the actual amount of
additional money in this figure amounts to only €700 million, and this is to be
shared among 79 African, Caribbean and Pacific countries, not simply for EPAs
but for other international trade issues.
In the context
of the ECOWAS EPA negotiations, and in the IEPA, the EU has also taken a
promise to work with ECOWAS and Ghana to raise funds from others to help. But even the ECOWAS negotiators have been
rather doubtful of this eventuality.
It is important
to emphasise, however, that the so-called development dimension of the (I)EPAs
is not and can never be adequately captured by financial assistance from the
EU. The real issue is one of the space
available to Ghana and other countries to pursue the policies that contribute
to transforming their economies and eradicate poverty. Trade policies such as are implicated under
the EPAs should to contribute to enhancing this policy space and this economic transformation. At least they are not supposed to undermine
them. However, as the above analysis
shows, the contents of the IEPAs lead precisely in the opposite direction.
III.
COMMITMENTS NOT RELATED TO TRADE -- LIBERALISATION OF SERVICES AND INVESTMENT
[Article, 44]
The Agreement also
has provisions on issues not related to trade in goods at all. Prominent among these are issues of
investment, competition, services, and intellectual property. Not only are these issues not required by the
WTO for an EPA agreement to be valid. In
addition, there is controversy as to whether some of these issues – for
instance investment and competition--
should be included in the negotiations at the West Africa level, with Ghana
actively among those countries opposed to negotiating the issues. The decision was taken at the West African
level to the effect that West Africa will adopt its own regional policies on
these issues, and only after that will it consider whether these issues should be negotiated as
part of the EPA.
However, the
current agreement obliges the Ghana government to co-operate with the EC to
“facilitate all the necessary measures leading to a conclusion as soon as
possible of a global EPA between the whole of the West Africa region and the
EC” on these issues. The approach
envisioned is one in which, after the West Africa region formulates and
implements in own policies, the parties will “deepen EC-West Africa trade
provisions on these issues”. Thus the Ghana
government has committed itself to promote negotiation of the very issues
within West Africa which it has itself rejected.
It has to be borne
in mind that the since the EPA negotiations started in 2000, the EC has brought
pressure to bear on its counterparts to include these issues in the EPAs, most
of the time against the clearly expressed positions of the counterparts. Indeed, West Africa’s position that it would consider
including the issues after formulating its own regional policies is a shift
from an original decision not to include these issues in the EPA under any
circumstances. This shift was achieved
under heavy-handed and under-hand pressure by the EU. The provisions in Ghana’s
IEPA on these issues are the latest in the line of these shifts in positions
engineered by the EC. In this regard,
the clause in the IEPAs to the effect that the provision does not prejudge the
position of the regional organisations on this issue is simply an obfuscating
formality: the intention is clear.
In the end,
therefore, the government has taken a posture which not only jeopardises the
role of the country in the region, it also undermines its own future
negotiating position on issues which it has itself said are dangerous for its
right and ability to define its own policies on investment in accordance with
the needs of domestic investors and the economy as a whole.
IV.
PREMATURE COMMITMENTS
Another area in
which the Government has assumed premature commitments which are prejudicial to
whatever agreement will ultimately emerge relates to the rules of dispute
settlement. Not only are commitments not
necessary for the proclaimed purposes of
the interim agreement – that is, the need to avoid trade disruption. More importantly ACP governments, including Ghana, differ from
the EU’s demand for a dispute settlement procedure based on trade
sanctions.
In the interim
Agreement, the Ghana government accepted the EU’s view where the agreement will be ultimately enforced
through compensation or “appropriate measures” [article 56, IEPA]– in the
context an euphemism for trade sanctions.
The few concessions made here by the EU are: (i) the tautology that aid (which is never part of trade any
way) shall be excluded when EC applies trade sanctions; combined with the idea (b) that EU shall
exercise restraint and try not to jeopardise the development of Ghana in
applying the sanctions.
Such an
approach to dispute settlement in trade issues is imbalanced. Ghana has limited
ability, if any, to apply such sanctions on the European Union. More importantly, the dispute settlement
mechanism has been discussed in the context of its application to the full EPA,
including those sections like investment, etc which have not been agreed
yet. The Government has thus put itself
in a position of accepting the punishment of the crime even before the crime is
defined, thus undermining its future negotiating positions.
This is just
one example of many other details contained in the so-called stepping stone
agreement where the government would have benefited from more thorough
discussions, in particular with its negotiating partners in the region,
especially since there have differences of view point, goal, and nuance with
the European Commission.
V.
INTERIM AGREEMENTS AND GHANA’S REGIONAL INTERESTS
Finally, the
processes around the Interim Agreements as well their content threaten Ghana’s
interests within the region as well the region’s own integration needs. While countries like Cote d’Ivoire have signed
them, others like Nigeria have rejected the interim agreements, and are still
debating other options with the EU. Ghana’s signature and ratification of the IEPA
will make it a free trade area with the EC, and a source of duty-free European
good into the West African region. Nigeria
is known to have signalled its intention to prevent such European goods from
coming into its market by banning goods from Ghana and other West Africa
countries with similar agreements.
The last time Nigeria
took a similar measure, it affected a range of Ghanaian products for which Nigeria
is the main or only market. Examples
include pharmaceutical products, mosquito coils and nets, pasta, etc; corn, and
furniture. In the light of this, and
given that Nigeria constitutes close to 60% of the West African regional
market, it will be a suicidal folly to ignore these implications, and to argue,
as some have done, that Ghana can survive without the Nigerian market, dealing
with Cote d’Ivoire in its place.
Furthermore,
the resort by the EC to negotiating the Interim Agreements with individual
countries undermines the regional approach that has been adopted to the EPA,
and which the EU has itself insisted was the aim of the EPAs.
VI. WAY FORWARD
The above
suggests that, even in terms of its objectives of assuring that trade between Ghana
and EU is not disrupted in the absence of the full EPAs, Ghana’s Interim
Economic Partnership Agreement leave a lot to be desired. Many actors have
developed many frameworks that can guide Ghana in this. One of the most of authoritative of the
latter is the EPA negotiating template developed by the Africa Union. Thus at
the very least, Ghana can NOT sign the IEPA as it stands now, without crucial
changes.
At the same
time, however, the very nature of the interim agreement has confirmed all the
concerns expressed by civil society organisations and producer groups about the
fundamentally anti-developmental nature of the EPAs. The claims of the EPAs as being supportive of
regional integration and development have been exposed as inaccurate. The IEPAs offer a foretaste of the actual
intentions of Europe in relation to countries like Ghana; of the political
vulnerability of these countries to EU pressure and ability to get its way; and
thus of the extent to which an EPA will serve Europe at the expense of the
developmental needs of Ghana and other countries in our region. It is time to turn around.
EDITORIAL
FARE THEE WELL
Former British Prime
Minister Lady Thatcher is dead and tributes have been pouring out since last
Monday when she passed.
It is significant
that Margaret Thatcher her death.
Whiles leaders of the
capitalist world are busily pouring praises on her, British working people and
those who reject the current world order
of oppression and exploitation are drawing attention to her destruction
of the lives of many.
Her blatant attacks
on trade union rights and the very essence of the welfare system in Britain
wretched havoc on many families.
She obstructed the
national liberation movements in Africa and elsewhere and even referred to the
African National Council (ANC) of South Africa as a terrorist organisation.
We say farewell to
Lady Thatcher not because she was a friend of the working people or that she
contributed to any worthy cause on earth.
Our farewell is to
another human being who gained notoriety for her frontal attacks on liberty and
equality.
Lady Thatcher, Fare
thee well.
THATCHER’S
DEATH HAILED AS A "GREAT DAY"
 |
| Margaret Thatcher |
Margaret Thatcher's death
was hailed as a "great day" for coal miners today. David Hopper,
General Secretary of the Durham Miners' Association, spent all of his working
life at Wearmouth Colliery.
Mr Hopper, who turned 70
on 8th. April 2013 (the day Thatcher died), said: "It looks
like one of the best birthdays I have ever had. There's no sympathy from me for
what she did to our community. She destroyed our community, our villages and
our people. For the union this could not come soon enough and I'm pleased that
I have outlived her. It's a great day for all the miners, I imagine we will
have a counter demonstration when they have her funeral.
"Our children have
got no jobs and the community is full of problems. There's no work and no money
and it's very sad the legacy she has left behind. She absolutely hated working people and I have got very bitter memories
of what she did. She turned all the nation against us and the violence that
was meted out on us was terrible. I would say to those people who want to mourn
her that they're lucky she did not treat them like she treated us."
Chris Kitchen, general secretary for the
National Union of Miners, said: "We've been waiting for a long time to hear the news
of Baroness Thatcher's demise and I can't say I'm sorry. I've got no sympathy
for Margaret Thatcher and I will not be shedding a tear for her. She's done
untold damage to the mining community. I don't think Margaret Thatcher had any
sympathy for the mining communities she decimated, the people she threw on the
dole and the state she left the country in." I honestly can't think of
anything good I can say about Margaret Thatcher."
Mr Kitchen, speaking in
Selby, North Yorkshire, said he believed mining would be different today if
Baroness Thatcher had not become prime minister and said she had left a legacy
of her policies. He said: "If Margaret Thatcher hadn't been in power, I
would hope mining would be different. I hope it would still be a nationalised
industry, run for the benefit of the nation and we wouldn't be seeing the hikes
in energy prices we are seeing now and will continue seeing." Her policies
still have an influence today, policies of greed and profit before all else. I
only hope when Margaret Thatcher is buried, they bury her policies with
her."
Brookside actor Ricky Tomlinson said: "She was the epitome of the
capitalist belief that you should take what you can and it doesn't matter who
you tread on to get it. What she did to the miners was a disgrace. She was
prepared to use the army against ordinary, British, working class people. The
legacy she left is still apparent whenever you drive past any former coal town
and see the desolation she left. She promised them all sorts when she wanted to
close the mines, she said she would give them this industry, that industry to
help people find work but it never happened. She gave them nothing, she left
them with no jobs and no hope."
Speaking to the
Liverpool Echo, long-serving Bootle
Labour MP Joe Benton added: "I send my condolences to Lady Thatcher's
family. I also send them to the thousands of families who suffered from the
policies she put in place when she was prime minister. Generations are still
suffering from the damage she did to our industrial and manufacturing base, and
her legacy of hitting the poor to give tax breaks to the rich."
Liverpool Walton MP Labour Steve Rotheram said: "The Iron Lady was one of the most
divisive figures in British political history, celebrated by big business and
the rich and powerful, but reviled by huge sections of a 'society' she didn't
actually believe in. Far from being the saviour of Britain, the people of
Liverpool have long recognised that it was that warped view of society that
compounded many of our city's greatest problems. Her legacy for Liverpool and
virtually every other city and town outside of the traditional shires and rural
England, was one of acute misery."
Daily Mirror Columnist
Fleet Street Fox writes: ""When our story time milk was taken away at
playschool, I asked the teacher why and she said: “ Bloody Thatcher .” When I
saw hungry men dragged kicking and screaming from the picket lines on the
evening news, I asked my parents why and they said: “Bloody Thatcher. A few
years ago in Worksop I asked a heroin addict why he first got high. “The
pit shut, we had no hope, I thought I’d feel better,” he said. “Bloody
Thatcher.”
"Hillsborough, the
poll tax, 15 per cent interest rates, 3million unemployed, ruined pit towns
with thousands of jobs sacrificed to make a political point. Grim times. And
grim delight today that Bloody Thatcher is finally dead."
Mirror writer Andy Dawson writes about how he grew up in Sunderland and
saw what Thatcher did to his community - and how he despised her for it.
She was the architect of
Britain today - a fractured place with the gap between the haves and the
have-nots wider than it has ever been. So, she’s gone then. A lot of people have waited a long time for
Margaret Thatcher to die so that
they can open a bottle and have a little jig. Me, I’m not that heartless. But I won’t mourn
her passing for a single millisecond. Some might see her as the architect of
Britain today, a moderniser. But Britain today is a fractured place, with the
gap between the haves and the have-nots wider than it has ever been. Thatcher
started that and she’s the fantasy figure of Cameron and his cronies who are
hell-bent on seeing her poisonous and divisive ideas carried out to their
squalid conclusion. I’ve lived in Sunderland for my whole life, and Thatcher
was the first Prime Minister that I was fully aware of and able to form an
opinion of. I saw what she did to the community that I grew up in and I
despised her for it. The heavy industry that was the lifeblood of so much of
the North East was systematically dismantled by her. Coal mining – now gone.
Shipbuilding – now gone. Steel production – now gone.
The miners’ strike of
1984 was so cynically orchestrated that it seemed like the Prime Minister was
actively waging war on the people she was supposed to serve. Coal stocks were
built up in advance to avoid power shortages and the miners were hung out to
dry, with the police (paid for by the people) operating as her personal
militia. But, as she was the one who once said that "there is no such
thing as society", it was clear that she didn’t give a toss about the
consequences that her policies had on human lives.
If the current
government has got a downer on ‘benefits culture’, they should realise that it
was their idol who started it. Her policies back then led to black holes of
unemployment in parts of the country where there were no Tory votes to be had –
so it didn’t matter.
Like the miners and
shipyard workers, they served no purpose for Thatcher, her followers and their
ideologies, and were just a source of endless irritation.
This Sunday is North
East derby day – Newcastle United will play Sunderland at St. James’ Park, a
fixture that is usually overloaded with bile from both sets of supporters. If
the powers-that-be think that a minute’s silence for the Iron Lady will be
appropriate, they’ll find that the fans are more unified in their response than
they’ve ever been.
Flowers were left outside a home of former prime minister Thatcher
within an hour of the announcement of her death. But not all who came were so
full of praise.
One man left a half pint of milk on the doorstep - in reference to
the nickname "Margaret Thatcher Milk Snatcher", gained in 1971 when
she stopped milk for children over seven as Education Secretary.
Thatcher's policies were "fundamentally wrong", FORMER LONDON MAYOR KEN LIVINGSTONE
SAID TODAY.
He told Sky News the former Conservative prime minister was
responsible for "every real problem" faced in the UK today, as he
claimed she had led millions of people out of work.
Mr Livingstone said: "Of course she was popular, she was
offering people their homes at a cut price. But she didn't build any houses. She
created today's housing crisis, she produced the banking crisis, she created
the benefits crisis. It was her government that started putting people on
incapacity benefits rather than register them as unemployed because the Britain
she inherited was broadly at full employment. She decided when she wrote off
our manufacturing industry that she could live with two or three million
unemployed and the legacy of that, the benefits bill that we are still
struggling with today. In actual fact, every real problem we face today is the
legacy of the fact she was fundamentally wrong."
He also said that it was to Tony Blair's "shame" that he
"broadly carried on" most of her policies.
Mr Livingstone added: "She once claimed New Labour was her
greatest legacy and I am not saying she was joking."
Mr Adams and fellow senior Sinn Fein representatives were subject
to the then Mrs Thatcher's ban of their voices being broadcast during the
Troubles.
"Her failed efforts to criminalise the republican struggle
and the political prisoners is part of her legacy," he added. "It
should be noted that in complete contradiction of her public posturing, she
authorised a back channel of communications with the Sinn Fein leadership but
failed to act on the logic of this. Margaret Thatcher will be especially
remembered for her shameful role during the epic hunger strikes of 1980 and 81.
Her Irish policy failed miserably. Margaret Thatcher did great hurt to the
Irish and British people during her time as British prime minister, Working
class communities were devastated in Britain because of her policies. Her role
in international affairs was equally belligerent whether in support of the
Chilean dictator Pinochet, her opposition to sanctions against Apartheid South
Africa; and her support for the Khmer Rouge. Here in Ireland her espousal of
old draconian militaristic policies prolonged the war and caused great
suffering."
He accused her of embracing censorship, collusion and the use of
lethal force in covert operations.
 |
| Tony Benn |
Former Labour cabinet minister Tony Benn said: “I disagreed with Mrs Thatcher throughout
her time as Prime Minister but I think that always did what she believed,
believed what she said and did what she said she’d do if she had the
opportunity. She took on the miners and at the end of the miners’ strike the
Tory party got rid of her and the miners re-elected Scargill. And of course she
planned the Poll Tax which was the final blow.”
Labour former Home Secretary David Blunkett said: "Margaret Thatcher was a most
formidable opponent, undoubtedly an outstanding leader and, as the first woman
prime minister in the United Kingdom, a groundbreaking politician.
"I have to acknowledge her deep commitment to her own values
and her determination, although, with Bernard Ingham at her side, she was the
first modern exponent of carefully worked spin, which allowed her to present
compromise as merely delay, and deep irritation with opponents in her own party
as principled stance. She said she could
not forgive the leadership of her own party for her downfall, and I have to say
that I cannot forgive her for what she did to my city of Sheffield, the mass redundancies,
the damage to productive industry and the use of incapacity benefit as a tool
to avoid internal social breakdown. In simple terms, we should remember her for
what she was. A remarkable woman, a divisive figure but a politician who could
mobilise both support and opposition in a way that fired British
politics."
Jack Jazz, on Twitter wrote: “There are some truths these idiotic
right wingers need to understand! Her close friend Pinochet did not "bring
democracy to Chile," he was a fascist dictator who used the military to
overthrow a democratically elected government and used torture, rape and murder
to suppress political opposition. The miners where not "the enemy
within" they were ordinary working people protecting their own community
from her attacks. The deaths of 96 football fans at Hillsborough was not caused
by drunken scousers, it was caused by the incompetence of a police force that
she had instilled with a sense of immunity from law and public scrutiny after
she let them off the leash at Orgreave. I will not be made to feel guilty by
right wingers or liberals for celebrating her death. The world is better
place without her!
She gave everything to the rich and conned the working class out
of their right to a good standard of living. She sold them their council houses
only for them to be repossessed in yet another recessions under tory boom and
bust. She sold off state industry and utilities to win elections and now we are
paying for it with rip off gas and electricity prices she deregulated
television so that her chief propaganda merchant Rupert Murdoch could introduce
Sky and make us all pay for the privilege. She deregulated public transport and
now fares are astronomical. She smashed the miners by allowing the police to
use guerrilla tactics destroying entire communities. She took the milk from the
mouths of infants who were too young to understand the politics of class
hatred!
She will be remembered by many for her cold and callous contempt towards them!!
She will be remembered by many for her cold and callous contempt towards them!!
Dave Wilson twitted: I am not, nor was I, a miner but had to endure
the mobs of police in front of my house, "controlling" the miners
pickets at the behest of the government. I was never more disgusted. I, nor the
thousands of miners who were thrown to the wind will mourn her passing.
Robert Smith twitted: A Liar at the highest level this woman, if it
had not been for the honesty of Clive Pontin Mrs Thatchers lies about the
General Belgrano steaming to threaten our forces in the Falklands would never
have been known and by the way I was in the Royal Navy at that time She lied to
Parliament about that, if that is being a person of conviction and should be
admired Adolf Hitler had the same conviction about his policies and was just as
wrong.
FARRAKHAN
The visit of Brother Louis Farrakhan, the
leader of the Nation of Islam to Ghana has been postponed.
Sources close to the
New York office of Brother Farrakhan say a new date will be announced soon.
He was expected to
have arrived in Accra on Thursday, April 11, 2013.
During his visit,
Brother Farrakhan will deliver a public lecture in Accra and call on President
John Dramani Mahama.
He is also billed to
have discussions with religious leaders in the country.
UK public jubilant at Thatcher’s
death
 |
| A Thatcher death party |
The death of former British
Prime Minister Margaret Thatcher has unleashed a hail of street parties, and
other joyful reactions across Britain.
In a show of the depth of public hatred against the former Conservative leader, hundreds of protesters gathered in Brixton, London and Glasgow to hold “Thatcher death parties” while similar parties were also planned in Liverpool, Newcastle and Manchester.
The public rejoicing was also clearly seen on the internet and elsewhere including among the members of the National Union of Students who cheered and applauded in their conference in Sheffield when they received the news of the former PM’s death.
On the streets, protesters held banners reading “Rejoice Thatcher is dead” while others said they are “here to celebrate the death of a woman with blood on her hands”.
Thatcher was never popular even when in power and she never won the votes of more than a third of the electorate because of her domestic policy of cuts and privatization leading to massive unemployment of up to three million people, which was unseen since the great depression of the 1930’s.
A protester in Glasgow said the celebrations are totally appropriate because Thatcher committed “economic crimes” in the 1980’s that devastated many families.
Her point was echoed by a member of the executive council of the Unite the Union in Glasgow Bryan Simpson who said they want to “point out that what she began is being continued by the Tories [PM David Cameron’s government] now”.
In England, David Hopper, general secretary of the Durham Miners' Association, said her death was a "great day" for coal miners.
In a show of the depth of public hatred against the former Conservative leader, hundreds of protesters gathered in Brixton, London and Glasgow to hold “Thatcher death parties” while similar parties were also planned in Liverpool, Newcastle and Manchester.
The public rejoicing was also clearly seen on the internet and elsewhere including among the members of the National Union of Students who cheered and applauded in their conference in Sheffield when they received the news of the former PM’s death.
On the streets, protesters held banners reading “Rejoice Thatcher is dead” while others said they are “here to celebrate the death of a woman with blood on her hands”.
Thatcher was never popular even when in power and she never won the votes of more than a third of the electorate because of her domestic policy of cuts and privatization leading to massive unemployment of up to three million people, which was unseen since the great depression of the 1930’s.
A protester in Glasgow said the celebrations are totally appropriate because Thatcher committed “economic crimes” in the 1980’s that devastated many families.
Her point was echoed by a member of the executive council of the Unite the Union in Glasgow Bryan Simpson who said they want to “point out that what she began is being continued by the Tories [PM David Cameron’s government] now”.
In England, David Hopper, general secretary of the Durham Miners' Association, said her death was a "great day" for coal miners.
Paul Kenny, General Secretary of Britain’s general union GMB, also paid his
share of condemnation of Thatcher saying "her legacy involves the
destruction of communities, the elevation of personal greed over social values
and legitimizing the exploitation of the weak by the strong".
People were also busy on the internet, making jokes about Thatcher’s death and tapping into their creativity to show their delight of the occasion.
An e-petition has been launched on the official government petitions website poking fun at Thatcher’s privatization policy and the government’s decision to hold a state funeral for her.
“In keeping with the great lady's legacy, Margaret Thatcher's state funeral should be funded and managed by the private sector to offer the best value and choice for end users and other stakeholders,” the petition, which has so far gathered 33,000 signatures, read.
The public pleasure was also seen on Twitter with political comic Jamie Kilstein writing “To honor Thatcher I will punch a poor person and to spite her, hug a coal miner”.
Another comedian Mick Ferry wrote “Maggie [Margaret Thatcher] is now working on a plan to privatize Hell” while political journalist Seumas Milne wrote called for “no state funeral for the most socially destructive prime minister of modern times”.
People were also busy on the internet, making jokes about Thatcher’s death and tapping into their creativity to show their delight of the occasion.
An e-petition has been launched on the official government petitions website poking fun at Thatcher’s privatization policy and the government’s decision to hold a state funeral for her.
“In keeping with the great lady's legacy, Margaret Thatcher's state funeral should be funded and managed by the private sector to offer the best value and choice for end users and other stakeholders,” the petition, which has so far gathered 33,000 signatures, read.
The public pleasure was also seen on Twitter with political comic Jamie Kilstein writing “To honor Thatcher I will punch a poor person and to spite her, hug a coal miner”.
Another comedian Mick Ferry wrote “Maggie [Margaret Thatcher] is now working on a plan to privatize Hell” while political journalist Seumas Milne wrote called for “no state funeral for the most socially destructive prime minister of modern times”.
Our Pastors, Jerusalem & Heaven!
Jerusalem
is in heaven!—I once truly believed.
So
strongly, in fact, that when I heard of some group of people returning from
Jerusalem alive, I thought to myself; surely, if one wanted to go to heaven
without first dying, then Jerusalem was his best bet.
More
recently, the matter of visiting the holy land has assumed new national
prominence for what some call the wrong reasons. First came the report that
Government of Ghana was paying a whopping USD 2M to send some men of God on a
pilgrimage to Jerusalem-Heaven to inter alia: pray for his Excellency’s good
health and prosperity, cast away the current dumsoric dark spirit afflicting
mother Ghana, intercede for the rains to come even as we thirst in the midst of
plenty and last but not the least, secure spiritual fortification of the men of
God themselves. Quite predictably, all hell broke loose as people questioned
the propriety of such an action as a pressing national priority.
In its
aftermath, government embarked on a fancy communication dance; clarified that
the actual amount involved was USD 600, 000 and that government was only a
facilitator and not the actual sponsor (said sponsor still remaining
unknown). At a meeting with religious
leaders later, his Excellency, apparently feeling frustrated about the a deal
gone South, asked the religious leaders themselves to clarify the current state
of their interest in order for government to decide whether to proceed or to
abort the facilitation effort.
In the
aftermath of the public outcry, many pastors and church related groups and
Councils have openly rejected the government’s offer and advised government to
use the money to address the hydra headed challenges of this nation. More
specifically, others have rejected the offer on account of bad timing,
uncertainty about the integrity of sponsors (unknown), abundant existing local
praying capacity to address Presidential prayer needs and encircling
poverty/hardship in greater need of similar donor largesse etc.
This
article will not examine the propriety or otherwise of the facilitation effort.
It will not question whether given that “the poor will always be with us’,
fighting poverty should be a cogent reason why matters of spiritual
fortification should not be pursued. It will not delve into ecclesiastical
matters of whether God hears our prayers more in Ghana or in heavenly
Jerusalem.
Rather, it will have the far narrower focus of interrogating whether
people always say what they truly believe, whether people including pastors,
have the courage of their own convictions and how sincerely we express
sometimes minority views rather than allow them to morph conveniently into the
popular view in order to gain social acceptance.
Three
years ago, I resolved to aspire always to tell the truth to myself and to
others. It was not that I was a rabid pathological liar. I had noticed however
on a very subtle basis how sometimes, in a group, one could conveniently allow
one’s own differing views to morph into the popular apparently more acceptable
opinions of others. I would later describe this as ‘mob mentality’.
 |
| Jerusalem |
I would
listen to some colleagues complain about an organization’s direction on the
quiet and in public, not have the courage to express a dissenting opinion. I
noticed how on many occasions, privately popular views, will be met with stony
silence when those same views erupted in public. For some it would be for fear
or for shame to be associated with such a view. A politician may do a good
thing but because honoring that success might be perceived as a sign of
weakness, we join the mob in condemning all politicians because we fit in
better and it earns us the favorite tag of “objective.” I resolved to speak the
truth to myself both privately and publicly.
A year after this resolution, I
was pleasantly surprised when separate conversations I had been having with two
friends who were in a conflict with each other, suddenly blew up with one
friend, forwarding all the email communication to a fourth party without my
knowledge. Because I had worked on the assumption that I must say in private
what I could defend in public, it did not end up as a big deal because I stated
the exact same things publicly.
I am
struggling to trust and accept some of our pastors/churches and the reasons
given for rejecting the Jerusalem-Heaven trip. Why? In August 2012, within three weeks of
President Mills’s death, when we as a people had forgotten how much we insulted
and ridiculed him and were showering him with a massive outpouring of unmatched
love, men of God praised President Mills for not being ashamed to identify
himself openly with Jesus Christ. Some men of God swore that Mills was already
in heaven, in the bosom of the Lord.
Others mentioned quite specifically, that
President Mills had declared his intention to make budgetary allocations to
enable Christians undertake a pilgrimage to Jerusalem akin to the Moslem mecca.
Salivating gleefully, men of God at the time expressed joy at this and when it
was reported in the media, it never created the uproar that today’s trip has.
People were still poor. We still had deficiencies in our energy requirements.
Prayers could still be said for the President at home. Nobody said a word against it. In fact some
lauded the initiative, saying they could not wait for it to happen.
Today,
because accepting the offer would be akin to what Al Gore calls an “inconvenient”
gift and will probably attract public opprobrium, because speaking out against
the trip and against government is the more popular position making you sound
more objective, more development-oriented and less trivial, I have not heard
any man of God say that, yes, I supported it yesterday, but I have changed my
mind today. Neither have I heard any man of God say that I supported it
yesterday and still do, today. This would have been far
nobler than some of today’s utterances.
In
conclusion, I have grouped the reactions from the Christian front into three
categories; those pastors who heard of this Jerusalem-Heaven for the first time
in 2013, felt outraged, and rejected it outright. And then there were those
pastors, who might have heard of the trip and rejected it in 2012 and whose
positions remain unchanged in 2013. And then there are those pastors who
praised the idea of the trip in 2012, and for reasons of political expediency,
are pretending to belong to group one.
The first two deserve respect. The last
does not. Government cannot be absolved of the manner of its handling of the
Jerusalem-Heaven trip but certainly, this third category of men of God, need to
go for confession! They have not been true to themselves and to the nation!
Sodzi Sodzi-Tettey
28th
March, 2013
US spikes military tensions over North Korean nuclear program
By Alex Lantier
 |
| White House |
Washington
is continuing to escalate military tensions in the global crisis triggered by
the US confrontation with North Korea over its nuclear program. All of the
region’s major powers are carrying out military exercises amid rising fears of
a war fueled by the US “pivot to Asia,” aimed at containing China, North
Korea’s main ally and protector.
Yesterday, US officials deployed
more forces to the Asia-Pacific and held high-level talks with Asian allies in
Washington, while North Korea pledged to restart the Yongbyon nuclear reactor.
As part of the two-month-long US-South Korean “Eagle Foal” military exercises,
the US deployed a second guided missile destroyer, the USS John McCain,
to Korean waters.
President Barack Obama met with
Singaporean Prime Minister Lee Hsien Loong at the White House.
At a press
conference following the meeting, the two leaders promoted US-Singaporean
military and economic cooperation and announced the deployment of more US
warships to Singapore, a port located on waterways connecting the Indian and
Pacific Ocean that are critical to Chinese trade. Neither Obama nor Lee raised
the military stand-off in Korea.
US Secretary of State John Kerry met
with South Korean Foreign Minister Yun Byung-se. Yun said their meeting focused
on the Korean peninsula, the US-South Korea alliance, and a coming state visit
in May by South Korean President Park Geun-hye. Adding that South Korea
supported US policy in Asia, Yun said China was being “cooperative” on North
Korea.
 |
| John Kerry |
For his part, Kerry said the US
“will not accept North Korea as a nuclear state.” This formulation, applied to
Iran, has been used to signal US willingness to go to war to keep Iran from
obtaining a nuclear weapon. On Monday, South Korea announced arrangements that
give US operational control of South Korean forces in wartime and reportedly
authorize possible “pre-emptive strikes” against Pyongyang.
At his press briefing yesterday,
White House spokesman Jay Carney called for China and Russia to pressure
Pyongyang to fall in line with US demands. “We are in close contact with our
allies in Seoul and Tokyo,” he said. “We are regularly reaching out to Beijing
and Moscow to encourage them to do more to restrain the North Koreans.”
North Korea is restarting a reactor
it shuttered in 2007, detonating the plant’s cooling tower. Its bid to
normalize relations with the US in exchange for ending its nuclear program
failed after the Bush administration refused to accept its nuclear verification
protocols.
The side that is escalating tensions
without restraint is not Pyongyang, but Washington. It will take several months
to restart the reactor, which Pyongyang said would be used for civilian energy
purposes, and at least a year to produce enough material for a nuclear bomb,
should Pyongyang use the reactor for that purpose.
The latest US deployments, on the
other hand, follow on the heels of the Pentagon’s decision to fly
nuclear-capable B-2 stealth bombers and B-52 bombers to Korea. Washington
claimed this was to signal its nuclear deterrence capabilities and prove to its
allies in South Korea and Japan the obvious fact that the US militarily
outclasses tiny North Korea. In reality, it was a blunt threat to the Chinese
regime that the US is willing to use nuclear weapons.
China and Russia also held
large-scale military exercises over the weekend. The Chinese navy held
live-fire exercises in the South China Sea, and Russian President Vladimir
Putin ordered snap naval exercises by Russia’s Black Sea fleet after returning
from a summit of emerging powers, including China, held in South Africa.
Washington is using the North Korean
nuclear standoff to pressure China, which has emerged as the most powerful
block on US imperialist policy. Not only is China the United States’ largest
creditor, it has vetoed UN resolutions that would have sanctioned open and
direct military intervention by Washington against Syria. China, moreover,
continues to trade with Iran.
These points of conflict underscore
the powerful imperialist interests driving Washington to adopt an increasingly
provocative posture toward Beijing with the aim, in the short-term, of shifting
China’s foreign policies.
On North Korea, Beijing has
distanced itself from Pyongyang’s decision to restart the Yongbyon reactor.
Foreign Ministry spokesman Hong Lei said, “We have noticed the statement made
by the DPRK [i.e., North Korea] and feel regretful about it. We are calling for
all parties concerned to remain calm and restrained, return to dialogue and
consultation as soon as possible, and jointly seek ways to appropriately
resolve the issue.”
In an April 1 article, China’s Global
Times called for Beijing to limit its support for North Korea and work out
a joint policy with Washington. The article stated: “China and the US have
shared common interests on the denuclearization of the Korean peninsula and
maintaining stability there. China’s policy toward North Korea should shift
over time.”
The article also warned Pyongyang
against believing that China has “tolerance toward North Korea’s possession of
nuclear weapons or constant nuclear tests.”
Such comments reflect the political
crisis shaking Beijing, as Washington demands that it turn upon a country to
which it has deep political and geo-strategic ties.
In 1950, the year after a revolution
brought the Chinese Communist Party to power, the Chinese army intervened in
the Korean War against the United States to prevent the destruction of North
Korea by US and South Korean forces. It thus blocked the establishment of a
pro-US state directly on China’s border and a possible US invasion of China to
restore capitalist rule. The war cost nearly one million Chinese soldiers’
lives. The Chinese army maintains close ties to its North Korean counterpart to
this day.
 |
| The North Korean people |
Unlike the Chinese and Vietnamese
bureaucracies, however, which turned to exploiting the working class as cheap
labor for export industries based on Western capital during the 1980s,
Pyongyang has remained economically isolated. Washington has consistently
opposed attempts to normalize relations with Pyongyang—a decision fraught with
complex consequences in the explosive geo-political environment of the Korean
peninsula.
Nonetheless, the Pyongyang regime is
as reactionary as its counterparts in Beijing and Hanoi. As the global economic
crisis drives regimes throughout Asia to prepare new assaults on working class
wages and social conditions, sections of the North Korean regime are signaling
their intention to press ahead with further market measures.
Monday’s
nomination of market reformer Pak Pong-ju as North Korea’s prime minister is
one such signal of attempts by the bureaucracy to find a basis for better
relations with US imperialism.
At the same time, the Pyongyang
regime remains deeply divided internally and fearful of the consequences of
normalizing ties with the US, especially under conditions where Washington is
constantly threatening it with war.
In January, Germany’s conservative Frankfurter
Allgemeine Zeitung wrote that North Korean officials were secretly
consulting German economists and lawyers on how to restore ties to the world
capitalist economy. One of the experts told the newspaper that Pyongyang was
interested in the market model in Vietnam, “where selected enterprises are
chosen to carry out investment.”
Another said that the army, which
currently dominates North Korea’s economy, largely opposed such plans. “The
military in North Korea will not want to give up control, however, so it is not
at all clear that the reforms will succeed,” he stated.
Under these conditions, US
imperialism appears set to further escalate its military threats in an attempt
to whip Pyongyang and Beijing into line.
A Perspective on Economic Integration in Africa (Parts I and II)
By Sudhanshu Sharma
 |
| Map of Africa |
Regional integration has received
much support from African governments. Many African countries, since
independence, have adopted regional integration as an important component of
their development strategies and concluded a very large number of regional
integration arrangements (RIAs), several of which have significant membership
overlap.
There are however few success stories. African RIAs are generally
ambitious schemes with unrealistic time frames towards deeper integration and
in some cases even political union. More often than not, African RIAs are
usually neighbourhood arrangements. The African paradigm is that of linear
market integration, following stepwise integration of goods, labour and capital
markets, and eventually monetary and fiscal integration. The starting point is
usually a free trade area, followed by a customs union, a common market, and
then the integration of monetary and fiscal matters to establish an economic
union. The achievement of a political union features as the ultimate objective
in many African RIAs.
The issue of economic integration in Africa will be explored in two parts. Part 1 discusses the rationale and need for such integration, the history of economic integration in Africa, various initiatives and their current state. It also evaluates the efficacy of economic integration initiatives in Africa. The paper argues that a linear model of economic integration, i.e. from Free Trade Area (FTA) to Economic Union, is inadequate to address Africa’s needs, and an alternate, inclusive and holistic model is required. Part two of this paper will explore what could such an approach be.
Rationale for economic integration in Africa
Regional economic integration has been at the forefront of economic and political discourses in Africa. African leaders have committed to implementing the regional economic integration agenda, recognising that without it most African countries, many of them land-locked, have small domestic markets that restrict economic growth and limited individual negotiating power.
The issue of economic integration in Africa will be explored in two parts. Part 1 discusses the rationale and need for such integration, the history of economic integration in Africa, various initiatives and their current state. It also evaluates the efficacy of economic integration initiatives in Africa. The paper argues that a linear model of economic integration, i.e. from Free Trade Area (FTA) to Economic Union, is inadequate to address Africa’s needs, and an alternate, inclusive and holistic model is required. Part two of this paper will explore what could such an approach be.
Rationale for economic integration in Africa
Regional economic integration has been at the forefront of economic and political discourses in Africa. African leaders have committed to implementing the regional economic integration agenda, recognising that without it most African countries, many of them land-locked, have small domestic markets that restrict economic growth and limited individual negotiating power.
Most African
countries have low per capita income levels and small populations which result
in limited markets. Small domestic markets and continental fragmentation
translates into a lack of scale economies in the production and distribution of
goods and services. Access to regional and international markets on more
favourable terms allows trade to be an engine of economic growth. Improved
efficiency within a country’s economy through reduced tariff and non-tariff
barriers (NTBs), fewer barriers to market entry and lower transaction costs,
including for transport, stimulates investment.
This will contribute to
improved agricultural production and economic diversification, and ultimately
lead to increased food security and improved welfare, including in the areas of
health and education. The need for effective implementation of the regional
economic integration agenda, as a path to job creation and poverty reduction,
is critical if African countries are to become internationally competitive.
History of economic integration in Africa
Africa’s geo-political configuration has been largely determined by the European colonial powers. The immediate post-independence era was characterised by a strong commitment to economic planning. The lynchpin of this approach was the belief that development would be promoted by industrialisation. The ambition of African leaders to integrate Africa, and to develop the continent through import substitution industrialisation, was a key feature of the immediate post-colonial period, and provided the rationale for the Lagos Plan of Action (LPA).(2) The LPA was an initiative of the Organisation of African Unity (OAU), adopted by heads of state in April 1980, and keenly supported by the United Nations Economic Commission for Africa (UNECA). A decade later in 1991, the Abuja Treaty provided strong support for the African integration agenda. The Treaty emphasised African solidarity, self-reliance and an endogenous development strategy, through industrialisation.
The proposed framework for African integration and continental industrialisation was the division of the continent into regional integration areas that would constitute a united African economy, the African Economic Community. In order to achieve this, UNECA supported three regional integration arrangements: the Economic Community of West African States (ECOWAS) for West Africa, which was established in 1975, predating the LPA; the Preferential Trade Area (PTA) covering East and Southern Africa, which was the precursor of the Common Market for Eastern and Southern Africa (COMESA); and the Economic Community of Central African States (ECCAS) for Central Africa. The Arab Maghreb Union (AMU) was established in 1989, completing continental coverage.(3)
The Southern African Development Co-ordinating Conference (SADCC) was established in 1980, by the so-called front line states with the specific aim of reducing economic dependence on apartheid South Africa, which was still excluded from the African integration plan. However, in anticipation of South Africa’s democratic transition in the early 1990s, SADCC became the Southern African Development Community (SADC) in 1992 and South Africa joined SADC in 1994.(4) SADCC was not a market integration arrangement; the front line states constituting the arrangement adopted a broad development mandate. Although the SADC Treaty (and subsequently the SADC Trade Protocol) does not articulate a detailed plan for integration, the detail was provided in the Regional Indicative Strategic Development Plan (RISDP) of 2003.(5)
History of economic integration in Africa
Africa’s geo-political configuration has been largely determined by the European colonial powers. The immediate post-independence era was characterised by a strong commitment to economic planning. The lynchpin of this approach was the belief that development would be promoted by industrialisation. The ambition of African leaders to integrate Africa, and to develop the continent through import substitution industrialisation, was a key feature of the immediate post-colonial period, and provided the rationale for the Lagos Plan of Action (LPA).(2) The LPA was an initiative of the Organisation of African Unity (OAU), adopted by heads of state in April 1980, and keenly supported by the United Nations Economic Commission for Africa (UNECA). A decade later in 1991, the Abuja Treaty provided strong support for the African integration agenda. The Treaty emphasised African solidarity, self-reliance and an endogenous development strategy, through industrialisation.
The proposed framework for African integration and continental industrialisation was the division of the continent into regional integration areas that would constitute a united African economy, the African Economic Community. In order to achieve this, UNECA supported three regional integration arrangements: the Economic Community of West African States (ECOWAS) for West Africa, which was established in 1975, predating the LPA; the Preferential Trade Area (PTA) covering East and Southern Africa, which was the precursor of the Common Market for Eastern and Southern Africa (COMESA); and the Economic Community of Central African States (ECCAS) for Central Africa. The Arab Maghreb Union (AMU) was established in 1989, completing continental coverage.(3)
The Southern African Development Co-ordinating Conference (SADCC) was established in 1980, by the so-called front line states with the specific aim of reducing economic dependence on apartheid South Africa, which was still excluded from the African integration plan. However, in anticipation of South Africa’s democratic transition in the early 1990s, SADCC became the Southern African Development Community (SADC) in 1992 and South Africa joined SADC in 1994.(4) SADCC was not a market integration arrangement; the front line states constituting the arrangement adopted a broad development mandate. Although the SADC Treaty (and subsequently the SADC Trade Protocol) does not articulate a detailed plan for integration, the detail was provided in the Regional Indicative Strategic Development Plan (RISDP) of 2003.(5)
This strategic plan articulates the roadmap for SADC’s integration and provides
for the establishment of a free trade area by 2008, a customs union in 2010, a
common market in 2015, a monetary union in 2016 and the introduction of a
single currency in 2018. There is still a long way to go before this plan
materialises as reality. Although the RISDP is not a legally binding
instrument, it enjoys significant political legitimacy and is recognised as the
strategic plan for SADC’s integration. The linear approach was also adopted by
the East African Community (EAC), established in 1997, and by ECOWAS in West
Africa. Progress in ECOWAS to establish a free trade area has been very slow
and the customs union is still a work in progress.
The Southern African Customs Union (SACU), often acknowledged as the oldest functioning customs union in the world, has a very specific history.(6) It was not established as a result of a decision by sovereign states, but is the outcome of a decision by a colonial power (Britain) to establish a customs union consisting of the Union of South Africa (now the Republic of South Africa), Basutoland (now Lesotho), Swaziland and Bechuanaland (now Botswana). Namibia, as a part of South West Africa under South Africa’s rule, was part of SACU before 1990; however it joined SACU as an independent country in 1990. SACU now consists of these five member states.
The Southern African Customs Union (SACU), often acknowledged as the oldest functioning customs union in the world, has a very specific history.(6) It was not established as a result of a decision by sovereign states, but is the outcome of a decision by a colonial power (Britain) to establish a customs union consisting of the Union of South Africa (now the Republic of South Africa), Basutoland (now Lesotho), Swaziland and Bechuanaland (now Botswana). Namibia, as a part of South West Africa under South Africa’s rule, was part of SACU before 1990; however it joined SACU as an independent country in 1990. SACU now consists of these five member states.
Despite its history spanning
more than a century, SACU is still a customs union in progress. South African
agencies still manage the affairs of the customs union related to the
implementation of the common external tariff. The SACU Tariff Board and
national bodies which would manage this function for SACU are provided for in
the 2002 SACU Agreement, but have not yet been established. SACU currently
faces many challenges: declining revenues, the need to revamp the revenue
sharing model - a major flash point, achieving inclusive growth and addressing
high levels of unemployment in the region are some of them.
Africa’s economic integration reflects a strong focus on liberalisation of trade in goods in the establishment of free trade areas and customs unions. Trade in services becomes a feature of the regional integration model when the stage of the common market is reached, yet, to date, services have received very little attention in formal African integration arrangements.
This is also
true of African countries foray into the regional trade agreement (RTA) arena
with external partners. The inclusion of services (issues such as investment,
competition policy and government procurement) is notable by its absence, and
has been contentious to say the least. The neglect of the trade in services
agenda is somewhat ironic in Africa where infrastructure services such as
transport and telecommunications adversely affect the costs of doing business,
and pose obvious challenges to the regional and continental integration.Africa’s economic integration reflects a strong focus on liberalisation of trade in goods in the establishment of free trade areas and customs unions. Trade in services becomes a feature of the regional integration model when the stage of the common market is reached, yet, to date, services have received very little attention in formal African integration arrangements.
Regional integration and Africa’s economic and trade performance
Africa’s regional integration record is not impressive. The fact that the large number of Regional Integration Agreements (RIA) have done very little to promote intra-regional trade raises questions about the relevance of linear integration models for addressing the real challenges that inhibit regional trade. What factors, in spite of numerous RIA and integration efforts, have caused Africa’s relatively dismal economic performance over the last few decades?
Contemporary research in the field of economic integration has been focusing on
this question for a while. This disappointing economic performance can be
attributed, partly, to the disproportionate dependence of African economies on
very few export products primary
commodities representing more than 80% of Africa’s total exports in recent
years and one or two sectors.(7) Such high dependence on commodities creates
severe constraints on growth due to commodity price volatility, a factor which
is external to these countries and beyond the scope of their domestic
policies.(8) However, many African countries lack the industrial capacity for
diversified manufactured goods, and are faced with inadequate infrastructure to
support trade.(9)
Although Sub-Saharan Africa is one of the fastest growing
regions in the world at present,(10) [t]his growth appears therefore to be intrinsically
fragile and based on distorted factors rather than sound economic fundamentals.(11) Consequently, it has been argued that a change in trade
composition, coupled with industrialisation, an improvement in infrastructure,
and structural transformation, would be key processes in triggering sustainable
growth paths in Sub-Saharan Africa.(12)
The situation of intra-regional trade in Africa is dismal. More than 80% of its exports are destined for markets outside Africa, the European Union and the United States of America being the most important export markets.(13) Asia, in particular China and India, is also an important market for Africa’s exports. In addition, Africa imports more than 90% of its goods from countries outside the continent, despite resource endowments which provide the potential to supply its own import needs.(14) Integration of very small and poor economies results in a relatively small regional market. Any market integration will facilitate some economies of scale benefits, thereby promoting a more competitive industrial development, however, in practice small regional integration constrains the benefits from economies of scale.(15)
The question of competitiveness
In the global scenario, trade competitiveness is crucial. A country’s trade performance, export sophistication and diversification are important indicators of its competitiveness. Considering various RIAs in Africa, SADC is the best performing region with three of the top five most competitive countries in Sub-Saharan Africa, namely South Africa, Mauritius and Botswana.(16) These countries have relatively conducive business environments with good institutional frameworks, efficient goods and labour markets, and mature financial markets. However, economic inequality, poverty, health and limited technological capability are a cause of concern. Inefficient government bureaucracy, an inadequately educated workforce, poor infrastructure and the lack of access to finance are important factors which hamper the ease of doing business in this region.
COMESA includes two of the top five best performing countries in Africa (Mauritius and Rwanda),(17) and also performs well in relation to other African regions. COMESA countries, in general, have strong institutions and well-developed financial markets, as well as efficient goods and labour markets. Factors hindering business in the region include access to financing, corruption, high tax rates, and inefficient government bureaucracy. EAC, one of Africa’s most successful regional economic integration initiatives, has efficient financial and labour markets and sound institutions. However, the quality of infrastructure, macroeconomic stability, health and education indicators and technological readiness is poor in the bloc. Countries within ECOWAS perform worst on the Global Competitiveness Index indicators in comparison to other RIAs. They are the strongest on institutions and innovation, and the weakest in the areas of health, education, and infrastructure development. Some of the most problematic factors for doing business in the bloc include access to finance, corruption, burdensome tax regulations, and inadequate supply of infrastructure.(18)
An important objective of RIAs is to reduce the transaction costs of trade. African RIAs have focused very much on the import tariff, aiming to achieve duty-free trade in goods among member states. The tariff is undeniably an important barrier but it may not necessarily be the most important one. Multiple border crossings for goods to reach land-locked countries add significantly to the transaction costs of intra-regional trade.(19) Also, inefficient border procedures and corruption are significant hindrances to intra-regional trade. It is encouraging to note that about half of all trade facilitation reforms made in 2009/2010 took place in Sub-Saharan Africa and the Middle East and North Africa, many motivated by regional integration efforts.(20) Easing trade regulations is increasingly important for business in a globalised world, as excessive documentation, burdensome customs procedures, inefficient port operations, and inadequate infrastructure all lead to additional costs and delays for exporters and importers, which ultimately hampers trade.(21)
However, it remains more onerous, costly, and time-consuming to export and import goods and services in Africa than in all other regions, with the possible exception of South Asia which requires more documentation to export and import than some African regional economic communities (RECs).
The situation of intra-regional trade in Africa is dismal. More than 80% of its exports are destined for markets outside Africa, the European Union and the United States of America being the most important export markets.(13) Asia, in particular China and India, is also an important market for Africa’s exports. In addition, Africa imports more than 90% of its goods from countries outside the continent, despite resource endowments which provide the potential to supply its own import needs.(14) Integration of very small and poor economies results in a relatively small regional market. Any market integration will facilitate some economies of scale benefits, thereby promoting a more competitive industrial development, however, in practice small regional integration constrains the benefits from economies of scale.(15)
The question of competitiveness
In the global scenario, trade competitiveness is crucial. A country’s trade performance, export sophistication and diversification are important indicators of its competitiveness. Considering various RIAs in Africa, SADC is the best performing region with three of the top five most competitive countries in Sub-Saharan Africa, namely South Africa, Mauritius and Botswana.(16) These countries have relatively conducive business environments with good institutional frameworks, efficient goods and labour markets, and mature financial markets. However, economic inequality, poverty, health and limited technological capability are a cause of concern. Inefficient government bureaucracy, an inadequately educated workforce, poor infrastructure and the lack of access to finance are important factors which hamper the ease of doing business in this region.
COMESA includes two of the top five best performing countries in Africa (Mauritius and Rwanda),(17) and also performs well in relation to other African regions. COMESA countries, in general, have strong institutions and well-developed financial markets, as well as efficient goods and labour markets. Factors hindering business in the region include access to financing, corruption, high tax rates, and inefficient government bureaucracy. EAC, one of Africa’s most successful regional economic integration initiatives, has efficient financial and labour markets and sound institutions. However, the quality of infrastructure, macroeconomic stability, health and education indicators and technological readiness is poor in the bloc. Countries within ECOWAS perform worst on the Global Competitiveness Index indicators in comparison to other RIAs. They are the strongest on institutions and innovation, and the weakest in the areas of health, education, and infrastructure development. Some of the most problematic factors for doing business in the bloc include access to finance, corruption, burdensome tax regulations, and inadequate supply of infrastructure.(18)
An important objective of RIAs is to reduce the transaction costs of trade. African RIAs have focused very much on the import tariff, aiming to achieve duty-free trade in goods among member states. The tariff is undeniably an important barrier but it may not necessarily be the most important one. Multiple border crossings for goods to reach land-locked countries add significantly to the transaction costs of intra-regional trade.(19) Also, inefficient border procedures and corruption are significant hindrances to intra-regional trade. It is encouraging to note that about half of all trade facilitation reforms made in 2009/2010 took place in Sub-Saharan Africa and the Middle East and North Africa, many motivated by regional integration efforts.(20) Easing trade regulations is increasingly important for business in a globalised world, as excessive documentation, burdensome customs procedures, inefficient port operations, and inadequate infrastructure all lead to additional costs and delays for exporters and importers, which ultimately hampers trade.(21)
However, it remains more onerous, costly, and time-consuming to export and import goods and services in Africa than in all other regions, with the possible exception of South Asia which requires more documentation to export and import than some African regional economic communities (RECs).
Trade
facilitation therefore remains important for the promotion of Africa’s
intra-regional and global trade performance. Though import tariffs may not be
the most important border concern, this measure highlights the specific
challenges of most African economies related to a weak and narrow tax base.
Trade taxes are important sources of revenues for most African governments.(22)
The poor implementation of tariff phase-downs in some RIAs can be traced down
to this potential loss of revenue.(23)
The second step in the linear model of regional integration is the formation of the customs union. It brings in new challenges, such as setting up supra-national institutions, and managing a common external tariff. Arrangements for the collection and distribution of customs revenue could prove to be contentious, specifically taking into account the complex compromise that is necessary within a diverse group of countries. This challenge is complicated in cases where a regional hegemony may have very specific industrial policy objectives informing its position on the import tariff. In some regional groups, significant divergence in perspectives on the role of the import tariff exists; for some, the import tariff is an important source of government revenue, while for others it is an instrument of industrial policy to be used selectively to protect specific industries.(24)
In this context, the importance of NTBs cannot be underestimated. The most important NTBs hindering regional trade in the east and southern African region (COMESA, EAC and SADC) include customs procedures and administrative requirements, technical standards and the lack of physical infrastructure. NTBs are of special relevance to agriculture within the region. Cumbersome documentation requirements, stringent standards and inefficient road and rail networks cause time delays and increase the cost of intra-regional trade.(25)
The second step in the linear model of regional integration is the formation of the customs union. It brings in new challenges, such as setting up supra-national institutions, and managing a common external tariff. Arrangements for the collection and distribution of customs revenue could prove to be contentious, specifically taking into account the complex compromise that is necessary within a diverse group of countries. This challenge is complicated in cases where a regional hegemony may have very specific industrial policy objectives informing its position on the import tariff. In some regional groups, significant divergence in perspectives on the role of the import tariff exists; for some, the import tariff is an important source of government revenue, while for others it is an instrument of industrial policy to be used selectively to protect specific industries.(24)
In this context, the importance of NTBs cannot be underestimated. The most important NTBs hindering regional trade in the east and southern African region (COMESA, EAC and SADC) include customs procedures and administrative requirements, technical standards and the lack of physical infrastructure. NTBs are of special relevance to agriculture within the region. Cumbersome documentation requirements, stringent standards and inefficient road and rail networks cause time delays and increase the cost of intra-regional trade.(25)
Though agreement on services is not essential for the conclusion of free trade
area or customs union, services are crucial in this context. Services contribute
significantly to economic activity and play an important role in facilitating
trade in goods. The lack of services infrastructure can restrict
competitiveness and increase trade transaction costs.
Reduction in transaction costs will result in the expansion of market access but it cannot ensure economic growth and development. Enhanced market access without enhancement of the capacity to produce goods and services to benefit from those opportunities will fail to produce higher economic growth. Most of the constraints to economic growth of African economies are on the supply side. Challenges related to enhancing supply-side capacity include improving the quality of governance, developing institutional capacity, investing in infrastructure and developing the associated regulatory infrastructure, and creating a business environment that will support domestic business to develop, and encourage foreign direct investment.(26)
Reduction in transaction costs will result in the expansion of market access but it cannot ensure economic growth and development. Enhanced market access without enhancement of the capacity to produce goods and services to benefit from those opportunities will fail to produce higher economic growth. Most of the constraints to economic growth of African economies are on the supply side. Challenges related to enhancing supply-side capacity include improving the quality of governance, developing institutional capacity, investing in infrastructure and developing the associated regulatory infrastructure, and creating a business environment that will support domestic business to develop, and encourage foreign direct investment.(26)
It is possible to develop policy
regulation and institutional capacity, in areas such as services regulatory
reform, investment and competition policy, at a national level. It may be
argued that a deeper regional integration agenda can assist in addressing the
national-level supply-side constraints by anchoring domestic policy and regulatory
reform processes. However, low income economies often have weak policy and
institutional infrastructure, and capacity constraints to manage these domestic
policy processes. Being unable to develop, manage and implement a comprehensive
regional integration agenda themselves, weak states may well be stumbling
blocks to the development of robust rules-based RIAs.
Africa and rule-based RIAs
In Africa, there are numerous political commitments to ambitious regional integration agendas, which often conflict or overlap with each other. A crucial question is that whether Africa’s regional integration experience demonstrates commitment to rules-based governance or whether RIAs are perceived as rules-based dispensations by their member states.
African RIAs have not been very successful in achieving successive steps of the linear model of regional integration. Delays in the ratification and domestic incorporation of regional legal instruments by member states, failure to implement specific provisions of the agreements such as negotiated tariff reductions, are common in RIAs. Sanctions for lack of implementation are generally absent in African RIAs.
Africa and rule-based RIAs
In Africa, there are numerous political commitments to ambitious regional integration agendas, which often conflict or overlap with each other. A crucial question is that whether Africa’s regional integration experience demonstrates commitment to rules-based governance or whether RIAs are perceived as rules-based dispensations by their member states.
African RIAs have not been very successful in achieving successive steps of the linear model of regional integration. Delays in the ratification and domestic incorporation of regional legal instruments by member states, failure to implement specific provisions of the agreements such as negotiated tariff reductions, are common in RIAs. Sanctions for lack of implementation are generally absent in African RIAs.
Regional institutions, established in RIAs,
are envisaged to contribute to the implementation of these agreements. However,
these institutions have not been able to play a robust role as an external
agency to ensure national compliance, domestic policy synchronisation and legal
and institutional development as may be required by the RIAs. The case of the
SADC Tribunal can be considered in this context. Following a decision by the
Tribunal that Zimbabwe was in breach of Article 6 of the SADC Treaty, Zimbabwe
expressed its dissatisfaction with the decision, and as a result, at the August
2010 Summit, the SADC Tribunal was suspended.(27)
While considering deeper regional integration within Africa, an important issue is the perceived loss of sovereignty that such an agenda involves. This issue is part of the broader policy space debate. It must be acknowledged that sovereignty is a feature of the state and not the government. Governments, acting on behalf of their respective states, conclude RIAs and thus the issue of loss of sovereignty is often more perceived than real. However, legitimate concerns about challenges to national sovereignty may well arise in situations where supra-national bodies act in an ultra vires manner or usurp powers over matters best left to legitimate national agencies.
In the case of Africa, when it comes to regional integration, a major concern is weak institutions and vaguely defined mandates. Even the compliance monitoring mechanisms are generally weak in most RIAs and completely absent in some of them. It is a common understanding that once legal arrangements have been established to pursue a common regional integration agenda, then transparency, certainty, predictability and respect for the rules should follow. Compliance should be monitored and non-compliance should be addressed. In short, this refers to the application of the rule of law at inter-state level. It seems fair to conclude that the rules-based nature of RIAs is not yet accepted by many African governments.(28)
While considering deeper regional integration within Africa, an important issue is the perceived loss of sovereignty that such an agenda involves. This issue is part of the broader policy space debate. It must be acknowledged that sovereignty is a feature of the state and not the government. Governments, acting on behalf of their respective states, conclude RIAs and thus the issue of loss of sovereignty is often more perceived than real. However, legitimate concerns about challenges to national sovereignty may well arise in situations where supra-national bodies act in an ultra vires manner or usurp powers over matters best left to legitimate national agencies.
In the case of Africa, when it comes to regional integration, a major concern is weak institutions and vaguely defined mandates. Even the compliance monitoring mechanisms are generally weak in most RIAs and completely absent in some of them. It is a common understanding that once legal arrangements have been established to pursue a common regional integration agenda, then transparency, certainty, predictability and respect for the rules should follow. Compliance should be monitored and non-compliance should be addressed. In short, this refers to the application of the rule of law at inter-state level. It seems fair to conclude that the rules-based nature of RIAs is not yet accepted by many African governments.(28)
Rule-based governance is not only significant in relation to the role of
governments in regional integration, but also to other stakeholders such as the
private sector. Though governments enter into RIAs; it is the private sector
that is responsible for the bulk of economic activities involved in regional
integration. Transparent rules and a supportive economic environment are
important for private sector activities in this context. This is compounded by
the limited role of the private sector in the design of African RIAs. The
feedback loop of private sector and other stakeholders is weak, and RIAs are
mostly fully state-driven. There is no doubt that the private sector can
provide important inputs into state matters of trade and technical issues like
Rules of Origin.
Conclusion
There is a strong rationale to pursue a regional integration agenda in Africa. Though regional integration has been at the forefront of the policy agenda of many African countries, RIAs have not been able to deliver the gains expected from them; this is attributable, in large part, to inefficient implementation rather than inadequate institutions. The linear model of economic integration, from FTA to Economic Union, is not feasible for African realities. The unique challenges Africa faces calls for an alternate and more inclusive approach to economic integration. What could be such an approach? This is the key question that will be explored in the second part of this paper.
NOTES:
(1) Contact Sudhanshu Sharma through Consultancy Africa Intelligence Finance and Economy Unit ( finance.economy@consultancyafrica.com). This CAI discussion paper was developed with the assistance of Gaylor Montmasson-Clair and was edited by Nicky Berg.
(2) McCarthy, C., 1999. Regional integration in Sub-Saharan Africa: Past, present and future in Oyejide, A., Ndulu, B. and Greenaway, D. (eds.). Regional integration and trade liberalization in Sub-Saharan Africa (Volume 4: Synthesis and Review), Palgrave Macmillan: Basingstoke.
(3) Ibid.
(4) Ibid.
(5) Ibid.
(6) Ibid.
(7) Sindzingre, A.N., The conditions for long-term growth in sub-Saharan Africa: China as a model, a constraint and an opportunity, Cahiers du Centre, Working Papers no. 9, July 2011, http://www.durkheim.sciencespobordeaux.fr.
(8) Ibid.
(9) Assessing regional integration in Africa IV: Enhancing intra-African trade’, United Nations Economic Commission for Africa, 2010, http://new.uneca.org.
(10) Doing Business 2011: Making a difference for entrepreneurs. Southern African Development Community (SADC), World Bank, 2011.
(11) Sindzingre, A.N., The conditions for long-term growth in sub-Saharan Africa: China as a model, a constraint and an opportunity, Cahiers du Centre, Working Papers no. 9, July 2011, http://www.durkheim.sciencespobordeaux.fr..
(12) Ibid.
(13) Assessing regional integration in Africa IV: Enhancing intra-African trade, United Nations Economic Commission for Africa, 2010, http://new.uneca.org.
(14) Ibid.
(15) Ibid.
(16) The Global Competitiveness Report 2012 2013, World Economic Forum, 2012, http://reports.weforum.org.
(17) Ibid.
(18) Ibid.
(19) McCarthy, C., 2007. Is African economic integration in need of a paradigm change? Thinking out of the box on African integration, in Bösl, A., et al. (eds.). Monitoring regional integration in Southern Africa (Yearbook Vol. 6 – 2007). Trade Law Centre for Southern Africa: Stellenbosch.
(20) Doing Business 2011: Making a difference for entrepreneurs. Southern African Development Community (SADC), World Bank, 2011.
(21) Ibid.
(22) South Africa and Mauritius are exceptions in this regard trade taxes contribute a very small percentage of overall tax revenue.
(23) In the case of SADC, the establishment of a free trade area in 2008 was hampered by a lack of implementation of agreed tariff reductions by several countries, due to revenue constraints Malawi and Mozambique were amongst the countries that were battling to keep pace with their tariff reduction commitments, as a result of government revenue concerns.
(24) McCarthy, C., 2007. Is African economic integration in need of a paradigm change? Thinking out of the box on African integration, in Bösl, A., et al. (eds.). Monitoring regional integration in Southern Africa (Yearbook Vol. 6 2007). Trade Law Centre for Southern Africa: Stellenbosch.
(25) Viljoen, W., Non-tariff barriers affecting trade in the COMESA-EAC-SADC Tripartite Free Trade Agreement, Trade Law Centre for Southern Africa, Working Paper, 2011, http://www.tralac.org.
(26) McCarthy, C., 2007. Is African economic integration in need of a paradigm change? Thinking out of the box on African integrationâ€, in Bösl, A., et al. (eds.). Monitoring regional integration in Southern Africa (Yearbook Vol. 6 – 2007). Trade Law Centre for Southern Africa: Stellenbosch.
(27) Afadameh-Adeyemi, A. and Kalula E., 2011. SADC at 30: Re-examining the Legal and Institutional Anatomy of the Southern African Development Community, in Bösl, A., et al. (eds.). Monitoring regional integration in Southern Africa (Yearbook Vol. 10, 2010). Trade Law Centre for Southern Africa: Stellenbosch.
(28) Erasmus, G., Deeper regional integration in SADC. Do the EPAs undermine the process? Trade Law Centre for Southern Africa, Working Paper, 2011, http://www.tralac.org.
Conclusion
There is a strong rationale to pursue a regional integration agenda in Africa. Though regional integration has been at the forefront of the policy agenda of many African countries, RIAs have not been able to deliver the gains expected from them; this is attributable, in large part, to inefficient implementation rather than inadequate institutions. The linear model of economic integration, from FTA to Economic Union, is not feasible for African realities. The unique challenges Africa faces calls for an alternate and more inclusive approach to economic integration. What could be such an approach? This is the key question that will be explored in the second part of this paper.
NOTES:
(1) Contact Sudhanshu Sharma through Consultancy Africa Intelligence Finance and Economy Unit ( finance.economy@consultancyafrica.com). This CAI discussion paper was developed with the assistance of Gaylor Montmasson-Clair and was edited by Nicky Berg.
(2) McCarthy, C., 1999. Regional integration in Sub-Saharan Africa: Past, present and future in Oyejide, A., Ndulu, B. and Greenaway, D. (eds.). Regional integration and trade liberalization in Sub-Saharan Africa (Volume 4: Synthesis and Review), Palgrave Macmillan: Basingstoke.
(3) Ibid.
(4) Ibid.
(5) Ibid.
(6) Ibid.
(7) Sindzingre, A.N., The conditions for long-term growth in sub-Saharan Africa: China as a model, a constraint and an opportunity, Cahiers du Centre, Working Papers no. 9, July 2011, http://www.durkheim.sciencespobordeaux.fr.
(8) Ibid.
(9) Assessing regional integration in Africa IV: Enhancing intra-African trade’, United Nations Economic Commission for Africa, 2010, http://new.uneca.org.
(10) Doing Business 2011: Making a difference for entrepreneurs. Southern African Development Community (SADC), World Bank, 2011.
(11) Sindzingre, A.N., The conditions for long-term growth in sub-Saharan Africa: China as a model, a constraint and an opportunity, Cahiers du Centre, Working Papers no. 9, July 2011, http://www.durkheim.sciencespobordeaux.fr..
(12) Ibid.
(13) Assessing regional integration in Africa IV: Enhancing intra-African trade, United Nations Economic Commission for Africa, 2010, http://new.uneca.org.
(14) Ibid.
(15) Ibid.
(16) The Global Competitiveness Report 2012 2013, World Economic Forum, 2012, http://reports.weforum.org.
(17) Ibid.
(18) Ibid.
(19) McCarthy, C., 2007. Is African economic integration in need of a paradigm change? Thinking out of the box on African integration, in Bösl, A., et al. (eds.). Monitoring regional integration in Southern Africa (Yearbook Vol. 6 – 2007). Trade Law Centre for Southern Africa: Stellenbosch.
(20) Doing Business 2011: Making a difference for entrepreneurs. Southern African Development Community (SADC), World Bank, 2011.
(21) Ibid.
(22) South Africa and Mauritius are exceptions in this regard trade taxes contribute a very small percentage of overall tax revenue.
(23) In the case of SADC, the establishment of a free trade area in 2008 was hampered by a lack of implementation of agreed tariff reductions by several countries, due to revenue constraints Malawi and Mozambique were amongst the countries that were battling to keep pace with their tariff reduction commitments, as a result of government revenue concerns.
(24) McCarthy, C., 2007. Is African economic integration in need of a paradigm change? Thinking out of the box on African integration, in Bösl, A., et al. (eds.). Monitoring regional integration in Southern Africa (Yearbook Vol. 6 2007). Trade Law Centre for Southern Africa: Stellenbosch.
(25) Viljoen, W., Non-tariff barriers affecting trade in the COMESA-EAC-SADC Tripartite Free Trade Agreement, Trade Law Centre for Southern Africa, Working Paper, 2011, http://www.tralac.org.
(26) McCarthy, C., 2007. Is African economic integration in need of a paradigm change? Thinking out of the box on African integrationâ€, in Bösl, A., et al. (eds.). Monitoring regional integration in Southern Africa (Yearbook Vol. 6 – 2007). Trade Law Centre for Southern Africa: Stellenbosch.
(27) Afadameh-Adeyemi, A. and Kalula E., 2011. SADC at 30: Re-examining the Legal and Institutional Anatomy of the Southern African Development Community, in Bösl, A., et al. (eds.). Monitoring regional integration in Southern Africa (Yearbook Vol. 10, 2010). Trade Law Centre for Southern Africa: Stellenbosch.
(28) Erasmus, G., Deeper regional integration in SADC. Do the EPAs undermine the process? Trade Law Centre for Southern Africa, Working Paper, 2011, http://www.tralac.org.
Part
II
Part I of this discussion paper considered the history, need and rationale of economic integration in Africa as well as the benefits it has in store for the continent and the challenges that it involves. The most significant development happening with regard to economic integration in Africa is the development and negotiation of the Tripartite Free Trade agreement (T-FTA).
This CAI paper focuses on the proposed T-FTA between the Southern African Development Community (SADC), the East African Community (EAC) and the Common Market for Eastern and Southern Africa (COMESA). The paper delves into the rationale, structure and policy considerations which must be taken into account to make this proposed free trade agreement a success. It looks at the T-FTA as a watershed in the economic integration narrative of Africa, with important economic and developmental implications.
The Tripartite Free Trade Area: A turning point in Africa’s regional integration?
In recent decades, there has been marked upsurge in regional trade agreements worldwide and Africa has had its fair share of it. Despite the large number of ambitious, but ineffectively implemented, integration initiatives, member states of SADC, EAC and COMESA have embarked on another ambitious integration programme. With more than 527 million people and a gross domestic product (GDP) of approximately US$ 624 billion, the 26 member countries of the Tripartite make up 57% of the population of the African Union (AU) and just over 58% in terms of GDP. This makes the Tripartite vital to the envisaged single market and continental integration of the African Economic Community (AEC).(2)
The heads of state and governments of the 26 member states of COMESA, EAC and SADC agreed in October 2008 to establish a grand Free Trade Area (FTA), now referred to as the T-FTA. Since its political inception, this initiative has followed a rather different course from other regional integration initiatives in Africa. The first step has been the setting up of various teams of technical experts who have been engaged in analytical work and have prepared a Draft Agreement and 14 Annexes, covering tariff liberalisation, Rules of Origin, the movement of business persons and dispute resolution, amongst other issues. Negotiations, however, were only officially launched at a summit, held in South Africa, in June 2011.
The first phase of the negotiations will focus on trade
in goods and the movement of business persons. Phase two will cover services
and other trade-related issues. It is, therefore, important to recognise that
the T-FTA does not exist yet, that the Draft Agreement and the annexes lack
official status and substantive negotiations have not yet begun.
Rationale and key objectives of the T-FTA
Multiple endeavours for economic integration in Africa have led to a spaghetti bowl (3) problem; many African countries have signed up for multiple trade agreements, some of which have conflicting requirements. The spaghetti bowl problem is characterised by conflicting implementation schedules and commitments of the different trade regimes, which undermine their effectiveness.
The growing awareness of the problems arising from the trade
agreement spaghetti bowl in Southern and Eastern Africa is at the foundation of
the proposed T-FTA agreed upon among the heads of state of COMESA, EAC and SADC
countries on 22 October 2008 at their meeting in Kampala. At this meeting, they
agreed on a number of issues,(4) including:
The expeditious establishment of an T-FTA encompassing the member states of the three Regional Economic Communities (RECs) with the ultimate goal of establishing a single customs union;
The development of a roadmap for the establishment of the FTA which would take into account the principle of variable geometry;(5) and
The legal and institutional framework to underpin the FTA; and measures to facilitate the movement of business persons across the RECs.
The T-FTA initiative is seen as a more realistic approach to harnessing the gains from regional integration. The summits vision is towards a large single market(6) with a theme of deepening COMESA, EAC and SADC regional integration. The Tripartite Summit agreed on a programme of harmonisation of trading arrangements amongst the three RECs, free movement of business persons, and joint implementation of inter-regional infrastructure programmes as well as institutional arrangements on the basis of which the three RECs would foster cooperation.(7) The Summit underscored the fact that the tripartite arrangement is a crucial building block towards achieving the AEC as outlined by the Treaty of Abuja.(8)
The rationale for the T-FTA initiative is to:(9)
Promote the rapid social and economic development of the region through employment and wealth creation and the elimination of poverty, hunger and diseases. It expands to skill building, innovation, factor locations towards national, regional and foreign investments to create trade opportunities;
The expeditious establishment of an T-FTA encompassing the member states of the three Regional Economic Communities (RECs) with the ultimate goal of establishing a single customs union;
The development of a roadmap for the establishment of the FTA which would take into account the principle of variable geometry;(5) and
The legal and institutional framework to underpin the FTA; and measures to facilitate the movement of business persons across the RECs.
The T-FTA initiative is seen as a more realistic approach to harnessing the gains from regional integration. The summits vision is towards a large single market(6) with a theme of deepening COMESA, EAC and SADC regional integration. The Tripartite Summit agreed on a programme of harmonisation of trading arrangements amongst the three RECs, free movement of business persons, and joint implementation of inter-regional infrastructure programmes as well as institutional arrangements on the basis of which the three RECs would foster cooperation.(7) The Summit underscored the fact that the tripartite arrangement is a crucial building block towards achieving the AEC as outlined by the Treaty of Abuja.(8)
The rationale for the T-FTA initiative is to:(9)
Promote the rapid social and economic development of the region through employment and wealth creation and the elimination of poverty, hunger and diseases. It expands to skill building, innovation, factor locations towards national, regional and foreign investments to create trade opportunities;
Overcome dependence on the export of primary commodities;
Dismantle bottlenecks attributed to regulations of commerce, particularly non-tariff measures currently undermining trade flows within respective RECs and amongst the RECs;
Jointly address poor infrastructure and institutional bottlenecks, including bureaucratic and physical hindrances such as road charges, transit fees, administrative delays at borders and ports, barriers to free movements of business persons, as well as overcome the challenges linked to the non-implementation of agreed commitments; and
Address challenges associated with overlapping memberships in the RECs, as well as ignite the stunted gains within the intra-regional tariff reforms;
The major objectives of T-FTA will be the following:(10)
To liberalise and facilitate trade in goods through inter alia the elimination of tariff and non-tariff barriers (NTBs) substantially on all intra-RECs trade;
To liberalise trade in services in selected sectors;
To facilitate, promote and enhance trade and investment as well as other areas of cooperation, e.g. industry, agriculture development and food security;
To enhance movement of business persons across the region; and
To develop and implement joint infrastructure programmes.
Will the T-FTA be different?
Africa’s integration record is marked by grand schemes, weak legal and
institutional foundations for a rules-based dispensation of regional
integration, and an implementation record that does not demonstrate serious
commitment. Within this backdrop, it is legitimate to ask whether the T-FTA
will be any different from its predecessors. The answer to this question lies
not in the draft instruments, but in the outcome of the political process that
will begin as member states negotiate the legal instruments of the T-FTA.
However, there are many important lessons to take from other African Regional
Integration Agreements (RIAs) which can contribute to making the T-FTA a
successful integration arrangement.
At the Second Tripartite Summit, it was agreed that a ‘developmental approach would be taken for the T-FTA integration process. The aim was to go beyond a narrow focus of removal of tariffs and other barriers restricting trade between and within RECs. The T-FTA is based on three pillars: Market integration, infrastructure development and industrialisation.(11) These pillars are expected to address the key challenges which constrain the competitiveness of African businesses, and consequently limit Africa’s regional integration achievements and also Africa’s integration with the global economy.
Market integration has been central to African integration initiatives with much focus on tariff liberalisation at the individual RIA level. Infrastructure development has featured on the regional cooperation agenda. It is about augmentation and coordination of regional and national infrastructures for the advancement of regional trade.
At the Second Tripartite Summit, it was agreed that a ‘developmental approach would be taken for the T-FTA integration process. The aim was to go beyond a narrow focus of removal of tariffs and other barriers restricting trade between and within RECs. The T-FTA is based on three pillars: Market integration, infrastructure development and industrialisation.(11) These pillars are expected to address the key challenges which constrain the competitiveness of African businesses, and consequently limit Africa’s regional integration achievements and also Africa’s integration with the global economy.
Market integration has been central to African integration initiatives with much focus on tariff liberalisation at the individual RIA level. Infrastructure development has featured on the regional cooperation agenda. It is about augmentation and coordination of regional and national infrastructures for the advancement of regional trade.
Industrialisation was part of the early
post-independence discussion on regional integration as a remedy to continental
fragmentation, small economies and small markets with limited scope for
economies of scale, but it has not, in recent years, featured explicitly on the
integration agenda.
The explicit focus of the T-FTA framework on industrial
development is notable because developing productive manufacturing capabilities
is vital for economic development. The inclusion of industrial development in
the T-FTA is also important because past industrialisation efforts of many
T-FTA countries largely failed to bring about significant industrial capacity.
As a result, most countries in the region continue to have relatively small and
weak manufacturing sectors. This has in turn led to a disproportionate
dependence of these countries on production and export of primary commodities,
making them vulnerable to global commodity prices and declining terms of trade.
The liberalisation of trade in goods could proceed expeditiously, building effectively on the tariff liberalisation that has already been achieved by COMESA, EAC and SADC.
The liberalisation of trade in goods could proceed expeditiously, building effectively on the tariff liberalisation that has already been achieved by COMESA, EAC and SADC.
Negotiations on Rules of Origin will be very important
for the T-FTA. NTBs are a key impediment to the integration process. SADC, EAC
and COMESA have established, through the Tripartite Coordination Mechanism, an
online NTB reporting system which can be effectively used in conjunction with
the existing legal instruments, and preferably a rules-based framework in the
T-FTA (the Draft Agreement calls for a concerted effort to eliminate NTBs).(12)
The T-FTA seeks to integrate 26 member states for which trade facilitation must be taken as a priority. Infrastructure development, which is recognised as an important constraint on industrial development and intra-regional trade is one of the focus areas.
The T-FTA seeks to integrate 26 member states for which trade facilitation must be taken as a priority. Infrastructure development, which is recognised as an important constraint on industrial development and intra-regional trade is one of the focus areas.
Another crucial area for the T-FTA is the development of
the services agenda encompassing services liberalisation and regulatory reform.
The T-FTA can mark a watershed for African integration if member states are committed
to the development of a comprehensive rules-based integration arrangement.
Structural challenges
Position of individual member states
In the proposed T-FTA, many countries are at different levels of development; the majority of them are Least Developed Countries (LDCs) and few are developing countries like Kenya, Namibia, Botswana, Libya, Mauritius, Seychelles, South Africa and Egypt. Although trade in goods and services has contributed to a considerable proportion of GDP in most member states, the service sector remains highly restricted and regulated.
Structural challenges
Position of individual member states
In the proposed T-FTA, many countries are at different levels of development; the majority of them are Least Developed Countries (LDCs) and few are developing countries like Kenya, Namibia, Botswana, Libya, Mauritius, Seychelles, South Africa and Egypt. Although trade in goods and services has contributed to a considerable proportion of GDP in most member states, the service sector remains highly restricted and regulated.
For the T-FTA to reach
a mutually beneficial agreement, member states will have to open some of the
regulated sectors for competition as well as investments. Its impact will be to
restrict monopoly, improve efficiencies, create employment and generate revenue
for the government in the form of domestic taxes. Also, many member states tend
to give preference to their respective national interests over the interests of
the RECs; such a conflict of interest, perceived or real, could impede the
progress on the T-FTA.
Multiple trade rules, multiple implications
The three RECs in the proposed T-FTA are at different levels of regional integration. Each of the blocks (COMESA, EAC and SADC) have notified the World Trade Organisation (WTO) as required under Article XXIV of the General Agreement on Tariff and Trade (GATT),(13) Article V of the General Agreements in Trade in Services (GATS) (14) and the Enabling Clause (EC).(15) COMESA and EAC were notified under the EC in 2001 and 2005 respectively, while SADC’s FTA was notified in 2006 under GATT Article XXIV.
Multiple trade rules, multiple implications
The three RECs in the proposed T-FTA are at different levels of regional integration. Each of the blocks (COMESA, EAC and SADC) have notified the World Trade Organisation (WTO) as required under Article XXIV of the General Agreement on Tariff and Trade (GATT),(13) Article V of the General Agreements in Trade in Services (GATS) (14) and the Enabling Clause (EC).(15) COMESA and EAC were notified under the EC in 2001 and 2005 respectively, while SADC’s FTA was notified in 2006 under GATT Article XXIV.
When a WTO member enters into a
regional integration arrangement through which it grants more favourable
conditions of trade with other parties to that arrangement than with other WTO
members, it departs from the Most Favoured Nation (MFN) rule, the guiding
principle of non-discrimination defined in Article I of GATT and elsewhere in
WTO agreements.
However, WTO members are permitted to enter such arrangements
under specific conditions which are spelled out in three sets of rules:
Paragraphs 4-10 of Article XXIV of GATT which provide for the formation and
operation of customs unions and FTA covering trade in goods, these specific
rules are referred to as the EC. Due to the differing levels of economic
development and categorisation as provided for in the EC, member states in the
course of their negotiations for the T-FTA will have to make a decision on how
they would want to notify the tripartite arrangement under the WTO.
Notification of a regional trade agreement entered into with non-LDC countries
(like South Africa, Egypt, and Mauritius) does not come under the purview of
the provisions of the EC. Thus, the member states would have an option to
notify the WTO under Article XXIV of the GATT, GATS Article V and Substantially All Trade (SAT) requirements.
A regional integration agreement is said to cover substantially all trade when it covers 95% of all HS tariff lines at 6-digit level, or 90% of all existing trade between partners. The challenge that faces the T-FTA is to reach a WTO compatible agreement within the purview of substantially all trade without violating the MFN principle.(16)Â Another aspect to consider is that many member countries to the T-FTA are also simultaneously conducting negotiations with other countries or trade blocks (like the European Community). It is important to ensure that there are minimal conflicts of interest and whether or not the member states will be able to implement multiple trade agreements coherently.
Financing
The Tripartite Task Force, which comprises of the Secretariats of three RECs scheduled to meet at least twice a year, requires financing to fund its activities and negotiations, and has entered into discussions accordingly with the African Development Bank, the World Bank, the European Union and the United Kingdom’s Department for International Development (DFID).(17)
A regional integration agreement is said to cover substantially all trade when it covers 95% of all HS tariff lines at 6-digit level, or 90% of all existing trade between partners. The challenge that faces the T-FTA is to reach a WTO compatible agreement within the purview of substantially all trade without violating the MFN principle.(16)Â Another aspect to consider is that many member countries to the T-FTA are also simultaneously conducting negotiations with other countries or trade blocks (like the European Community). It is important to ensure that there are minimal conflicts of interest and whether or not the member states will be able to implement multiple trade agreements coherently.
Financing
The Tripartite Task Force, which comprises of the Secretariats of three RECs scheduled to meet at least twice a year, requires financing to fund its activities and negotiations, and has entered into discussions accordingly with the African Development Bank, the World Bank, the European Union and the United Kingdom’s Department for International Development (DFID).(17)
For example, a
consultative meeting with the Tripartite Task Force held in London on 3 March
2010 resulted in indicative allocations of £400,000 (US$ 609,000) for the 2010
work plan from DFID TradeMark programme covering administrative and logistical
support for tripartite meetings, including the Summit and the Tripartite Trust
Fund and its sub-committees.
A total of £600,000 (US$ 914,000) was allocated
for the preparation and negotiations of a tripartite FTA.(18) DFID also
allocated at least £2.9 million (US$ 4.4 million) for the development of
corridors and infrastructure and border posts and approximately £1.5 million
(US$ 2.3 million) for developing the tripartite agenda on trade facilitation
and addressing broader trade policy issues in the region such as competition
and standards. These figures are largely for technical support for project
implementation and co-ordination.(19)
The concern here is the extent to which
this financing, which is heavily dependent on external funding, is sustainable.
This assumes more gravity when one considers the recent, rather frequent,
instances wherein donor countries have not honoured their financial aid
commitments. This raises the question of how member states would sustain the
negotiations and implementation.
A possible solution is the creation of a
shared T-FTA resource pool mechanism to mobilise resources. However, the
creation of such a resource pool is debatable considering the fact that many
member states already lack the necessary capacity and resources to finance
domestic programmes such as poverty reduction, as well as the secretariats in their
current regional trade blocs.
Conclusion and policy considerations
An enlarged market created by the establishment of the T-FTA presents increased market opportunities for trade in goods and services produced within the FTA, thus stimulating increased industrialisation, production, employment, income generation and poverty reduction, among other economic and social benefits.
Conclusion and policy considerations
An enlarged market created by the establishment of the T-FTA presents increased market opportunities for trade in goods and services produced within the FTA, thus stimulating increased industrialisation, production, employment, income generation and poverty reduction, among other economic and social benefits.
The
T-FTA will definitely help in addressing some prevailing challenges among the
three regional blocks namely non-tariff measures on goods, infrastructural
problems and trade facilitation, multiple membership and rules, rules of
origin, defensive interests of some members states and eliminate member states
restriction on the movement of natural persons and service consumers.
However,
it is premature to conclude that T-FTA will completely replace previous FTAs.
Also, there is a need for a deeper economic integration framework taking into
consideration the developmental needs of other member states, especially LDCs.
With regards to goods and services negotiations, the T-FTA working committees need to examine the specific barriers to trade, especially in services, including domestic regulations in individual member states. There is also a need to adopt a rules-based system of agreement where the structures of the agreement are legally executable by a supra-national institution charged with monitoring and ensuring enforcement of the agreement.
With regards to goods and services negotiations, the T-FTA working committees need to examine the specific barriers to trade, especially in services, including domestic regulations in individual member states. There is also a need to adopt a rules-based system of agreement where the structures of the agreement are legally executable by a supra-national institution charged with monitoring and ensuring enforcement of the agreement.
The harmonisation of
technical regulations, standards and conformity assessments procedures are
necessary in the tripartite negotiations. Member states need to devote more
attention to building a mechanism under which there would be a mutual
recognition of standards and conformity assessments. This would require the
establishment of standard development centres to support uniformity of
standards, testing and certification requirements.
The T-FTA framework marks a departure from the traditional model of linear integration pursued by FTAs in Africa. This will undoubtedly lead to positive synergies; however, it is important to follow the course of its development with guarded optimism. The COMESA-EAC-SADC T-FTA is a crucial part of Africa's grand economic integration ambitions wherein it seeks to achieve a Continental-Free Trade Area (CFTA) by 2017.(20)
NOTES:
(1) Contact Sudhanshu Sharma through Consultancy Africa Intelligence Finance amd Economy Unit ( finance.economy@consultancyafrica.com). This CAI discussion paper was developed with the assistance of Gaylor Montmasson-Clair and was edited by Nicky Berg.
(2) COMESA-EAC-SADC Tripartite website, www.comesa-eac-sadc-tripartite.org.
(3) Bhagwati, J., 1995. “U.S. trade policy: The infatuation with free trade agreements, in Bhagwati, J. and Krueger, A. (eds.). The dangerous drift to preferential trade agreements. AEI Press: Cambridge.
(4) Final communique of the COMESA-EAC-SADC tripartite summit of Heads of state and government, Trade Law Centre, 2012, http://www.tralac.org.
(5) The principle of variable geometry implies a concept of a community in which some countries may integrate more (or faster) than others.
(6) Othieno, L. and Shinyekwa, I., ‘Prospects and challenges in the formation of the COMESA-EAC and SADC Tripartite Free Trade Area’, Economic Policy Research Centre, November 2011, http://www.eprc.or.ug.
(7) ‘Historic first EAC-SADC-COMESA Tripartite summit’, The African Executive, 29-05 November 2008, http://www.africanexecutive.com.
(8) Ibid.
(9) Shayanowako, P., Towards a COMESA, EAC and SADC Tripartite Free Trade Area, Trade & Development Studies Trust, January 2011, http://www.panafricanglobaltradeconference.com.
(10) Ibid.
(11) See the texts of the Draft Agreement and the 14 Annexes, http://www.tralac.org.
(12) Ibid.
(13) World Trade Organisation website, http://www.wto.org.
(14) General agreement on trade in services, World Trade Organisation, 1994, https://www.wto.org.
(15) Work on special and differential provisions, World Trade Organisation, http://www.wto.org.
(16) Under the WTO agreements, countries cannot normally discriminate between their trading partners. If it grants someone a special favour (such as a lower customs duty rate for one of their products) then it will have to do the same for all other WTO members.
(17) COMESA-EAC-SADC tripartite website, http://www.comesa-eac-sadc-tripartite.org.
(18) Regional integration strategy paper 2011 2015, African Development Bank, September 2011, http://www.afdb.org.
(19) Ibid.
(20) Draft framework, road map and architecture for fast tracking the Continental Free Trade Area (CFTA), African Union, 2011, http://www.au.int.
The T-FTA framework marks a departure from the traditional model of linear integration pursued by FTAs in Africa. This will undoubtedly lead to positive synergies; however, it is important to follow the course of its development with guarded optimism. The COMESA-EAC-SADC T-FTA is a crucial part of Africa's grand economic integration ambitions wherein it seeks to achieve a Continental-Free Trade Area (CFTA) by 2017.(20)
NOTES:
(1) Contact Sudhanshu Sharma through Consultancy Africa Intelligence Finance amd Economy Unit ( finance.economy@consultancyafrica.com). This CAI discussion paper was developed with the assistance of Gaylor Montmasson-Clair and was edited by Nicky Berg.
(2) COMESA-EAC-SADC Tripartite website, www.comesa-eac-sadc-tripartite.org.
(3) Bhagwati, J., 1995. “U.S. trade policy: The infatuation with free trade agreements, in Bhagwati, J. and Krueger, A. (eds.). The dangerous drift to preferential trade agreements. AEI Press: Cambridge.
(4) Final communique of the COMESA-EAC-SADC tripartite summit of Heads of state and government, Trade Law Centre, 2012, http://www.tralac.org.
(5) The principle of variable geometry implies a concept of a community in which some countries may integrate more (or faster) than others.
(6) Othieno, L. and Shinyekwa, I., ‘Prospects and challenges in the formation of the COMESA-EAC and SADC Tripartite Free Trade Area’, Economic Policy Research Centre, November 2011, http://www.eprc.or.ug.
(7) ‘Historic first EAC-SADC-COMESA Tripartite summit’, The African Executive, 29-05 November 2008, http://www.africanexecutive.com.
(8) Ibid.
(9) Shayanowako, P., Towards a COMESA, EAC and SADC Tripartite Free Trade Area, Trade & Development Studies Trust, January 2011, http://www.panafricanglobaltradeconference.com.
(10) Ibid.
(11) See the texts of the Draft Agreement and the 14 Annexes, http://www.tralac.org.
(12) Ibid.
(13) World Trade Organisation website, http://www.wto.org.
(14) General agreement on trade in services, World Trade Organisation, 1994, https://www.wto.org.
(15) Work on special and differential provisions, World Trade Organisation, http://www.wto.org.
(16) Under the WTO agreements, countries cannot normally discriminate between their trading partners. If it grants someone a special favour (such as a lower customs duty rate for one of their products) then it will have to do the same for all other WTO members.
(17) COMESA-EAC-SADC tripartite website, http://www.comesa-eac-sadc-tripartite.org.
(18) Regional integration strategy paper 2011 2015, African Development Bank, September 2011, http://www.afdb.org.
(19) Ibid.
(20) Draft framework, road map and architecture for fast tracking the Continental Free Trade Area (CFTA), African Union, 2011, http://www.au.int.
Source:Ocnus.net 2013
'Baghdad Bob' and His Ridiculous, True Predictions
By Emily DePrang
 |
| Mohammed Saeed al- Sahaf, Information Minister |
In March of 2003, Saddam's Minister
of Information was everybody's favorite inadvertent comedian. Sporting a kicky
black beret and delightfully bombastic lexicon, Mohammed Saeed al-Sahaf appeared
on TV daily to predict American failure and deny the Baghdad
invasion--sometimes even as U.S. tanks appeared behind him.
"He's
great," President George W. Bush said of Sahaf, admitting that he occasionally interrupted
meetings to watch Sahaf's briefings. "Someone accused us of hiring him and
putting him there. He was a classic."
Sahaf became the subject of
T-shirts, mugs, adoring websites, a pop song, and an action figure. Besides
adding levity to news cycles otherwise filled with fuzzy green explosions,
Sahaf represented everything that made Iraq's invasion seem not quite like a
real war. Wars are serious, and this guy was adorable. Even if you opposed the
Iraq invasion, you had to admit it's hard to respect a government whose
official mouthpiece told a reporter, "Shock and awe? It seems that we are
the awe on them. They are suffering from the shock and awe, okay?"
"My information was correct, but my interpretations
were not," he explained. But in retrospect, the opposite seems truer.
Sahaf stuck to his post--and his
story--until the day before Baghdad fell. Then he surrendered to American
forces, was interrogated and promptly released, suggesting a lowly spot on the
Ba'ath party totem pole. He surfaced in Abu Dhabi in July of 2003, gave a
couple of interviews, and settled into obscurity.
"My information was correct,
but my interpretations were not," he explained.
But in retrospect, the opposite
seems truer. Sahaf had bad information, sure, but several of his more ludicrous
predictions have since come true--some in the ways he meant, and, more
chillingly, some in ways no one (else) could have foreseen.
Sahaf's nickname, "Baghdad
Bob," now denotes someone who confidently declares what everyone else can
see is false--someone so wrong, it's funny. But when read beside the eventual
cost of America's decade in Iraq, "Baghdad Bob" isn't so funny
anymore.
THE PREDICTION:
"The crook Rumsfeld said yesterday that they are hunting mass destruction weapons in Baghdad
and Tikrit, and yesterday I replied to that cheap lie."
"I assure you that those villains will recognize, will discover in
appropriate time in the future how stupid they are and how they are pretending
things which have never taken place."
THE REALITY
As a 2012 CIA study concluded
definitively, Saddam Hussein didn't have weapons of mass destruction. Nor did
Iraq have 18 mobile laboratories for making anthrax and botulism, as Secretary
of State Colin Powell claimed before the United Nations in February 2003, nor
had Saddam Hussein recently tried to buy large quantities of uranium from
Africa, as President Bush asserted in his 2003 State of the Union address. A
decade of war was based on things that had never taken place.
THE PREDICTION
"They are trying to say that
the Iraqi is easy to capture, in order to deceive the world that it is a
picnic... One
day, they [will] start facing bitter facts."
"The decisive battle is
throughout Iraq. They do not know in what mud they are wading."
THE REALITY
In 2002, Kenneth Adelman, a member
of the Pentagon's Defense Policy Board, wrote in the Washington Post, "I believe demolishing Hussein's military power and
liberating Iraq would be a cakewalk. Let me give simple, responsible reasons:
(1) It was a cakewalk last time; (2) they've become much weaker; (3) we've
become much stronger; and (4) now we're playing for keeps."
Wars are serious, and this guy was adorable.
Adelman was right that beating
Hussein's military power would be easy-ish, though it took longer than George
Bush Sr.'s 100-hour incursion in 1991. What Adelman didn't realize--and Sahaf
did--was that occupation, not invasion, would be the bitter pill. Result: not a
picnic.
THE PREDICTION
"How
can you lay siege to a whole country? ...We are in our country, among our kith and kin.
...Faltering forces of infidels cannot just enter a country of 26 million
people and lay besiege to them! They are the ones who will find themselves
under siege."
"Are they not going to find
themselves besieged by the people of the countryside which they have to cross
in order to reach Baghdad? Civilians will be busy. The grassroots of the Ba'ath
Party will be busy attacking them.
He wasn't just right that Iraqis would reject the American
invasion. He was also right about how that rejection would manifest itself.
"The simple fact is this: they
are foreigners inside a country which has rejected them. Therefore, these
foreigners, wherever they go or travel, they will be rained down with bullets
from everyone. Attacks
by members of the resistance will only go up."
THE REALITY
Sahaf wasn't just right about the
fact that Iraqis would reject American invasion. He was right about how.
As predicted, troops were most vulnerable when in transit, especially from
"the people of the countryside," thanks to improvised explosive
devices (IEDs). Of the more than 6,600 soldiers killed in Iraq and Afghanistan,
almost exactly as many were killed by IEDs as by firefights. "After a
decade of war in Iraq and Afghanistan costing more than $1 trillion, U.S.
troops continue to die and be maimed by a weapon that can be cobbled together
with spare parts costing less than $30," journalist William Levesque wrote
in the Tampa Bay Times in 2012.
And the warning that resistance
attacks would "only go up"? Well, they came down eventually--about
five years later. But in 2003, the year "major combat operations"
officially began and ended in Iraq, 486 American servicemen and women died
there. By the time the last U.S. tanks rolled out of Iraq in 2011, the
grassroots resistance Sahaf predicted had taken 4,474 American lives.
 |
| Late Iraqi President Saddam Hussein |
THE PREDICTION
"This stooge, Blair...
Fantastic, this man, really. I think the British nation have never been faced
with a tragedy like this fellow."
"Blair, you are a war criminal.
You should be tried because you told the British public lies."
THE REALITY
Blair's international stature
certainly declined after his decision to enter the war.
In August of last year, Archbishop
Desmond Tutu pulled out of a conference on leadership after he learned former
British Prime Minister Tony Blair would be attending.
"The immorality of
the United States and Great Britain's decision to invade Iraq in 2003, premised
on the lie that Iraq possessed weapons of mass destruction, has destabilized
and polarized the world to a greater extent than any other conflict in
history," Tutu wrote in a piece for The Observer explaining his decision.
THE PREDICTION
THE REALITY
In 2003, this was probably Sahaf's
most quoted line. It was so conveniently ludicrous, so patently untrue, that
commentators didn't have to do any research or devote any column inches to
disproving it.
A decade later, nobody jokes about
military suicide. The Department of Veteran Affairs recently published the most
comprehensive study of veteran suicides ever conducted, revealing that about 22
American vets committed suicide every day in 2010, the most recent year for
which data was available. That's up from 18 per day in 2008.
So Sahaf was actually slightly wrong
on this one. The United States really loses their servicemen and women to
suicide not by the hundreds, but by the thousands. And not at the gates of
Baghdad, but at home.
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