Fair trade with Europe should depend on quality of African exports

Participants at the 12th African Economic conference have urged African countries to add value to their exports in order to score a competitive edge when trading with Europe under the Economic Partnership Agreements (EPA). The EPAs are ongoing negotiations expected to create a free trade area between the European Union and African, Caribbean and Pacific Group of States (ACP). Although they are a response to rules set by the World Trade Organisation (WTO) to enforce reciprocity in trade with the European Union, the African continent has been indifferent over them.

Several countries in blocs such as the Economic Community of West African States (ECOWAS) signed the agreement on the conviction that it would boost their exports to new European markets. While other countries, particularly in the East African Community, have been indifferent over the deal arguing that it does not offer enough protection for local industries against goods imported from Europe. While discussing his paper titled ‘Economic interactions based on free trade agreement between European and Africa countries”, Leleng Kebalo argued that African states should consider ratifying agreements that include technological factors that improve the quality of their exports.

“If the agreement includes technological transfers, then this can lead to economic transformation. Free trade with Europe or any developed region, without technological transfers is harmful for the evolution of less competitive economies in Africa,” he told a session at the African Economic Conference in Addis Ababa on Tuesday, December 5.
“We advise African leaders to improve competitiveness of their economies through a gradual opening of their economies to European goods, in return for freedom of learning and adapting innovations,” the researcher from the University of Lomé added.
Another researcher from the Food and Agriculture Organisation of the United Nations (FAO), Davide Del Prete, said that trade policies and agreements must be analysed deeply because they impact food and agriculture global chain participation in Sub-Saharan Africa.

“We find that trade policies are key determinants of the heterogeneity of the quality of agricultural transformation across the Sub-Saharan region. Policy-makers should test alternative trade policy measures on bilateral trade relationships, including agricultural value chain interactions,” he said. The research papers were commended by John Anwanyu, Lead Research Economist in the Macroeconomic Policy, Forecasting and Research Department at the African Development Bank (AfDB). He encouraged the researchers in the session and asked them to continue their role in advancing fact-led policy implementation of trade agreements.

“Political will and evidence-based implementation are encouraged by facts and quality research that is specific and relevant to the African situation. With vast majority of African economies advancing free trade and pursuing overseas markets, research is a vital key that will ensure positive policies,” he said. The AfDB has supported the growth of exports and trade for countries across the Africa continent. The Bank has also advanced intra-African trade as a sure channel with the greatest potential for building sustainable economic development and regional integration. The Bank’s flagship report – the African Economic Outlook 2017 – cited that trade among African countries expanded from a mere 10 per cent in 2000 to 14 per cent in 2014, reflecting gains in policies advancing intra-African trade.