If developing countries “get it wrong” in the current round of global and hemispheric trade negotiations then they could be faced with a steep decline in their Gross Domestic Product (GDP).
This warning was delivered by Senator the Hon. Julian R. Hunte, Minister of Foreign Affairs, International Trade and Civil Aviation of St Lucia as he addressed the opening session of the 8th African Caribbean and Pacific (ACP) Ministerial Trade Committee Meeting (MTC) at the Sandals Grand Hotel, St Lucia on Thursday 27 February 2003. The Ministers are preparing for negotiations with the European Union (EU) on Economic Partnership Agreements (EPA) under the Cotonou Agreement which governs aid, trade and economic arrangements between the EU and the ACP countries.
Mr Hunte told his colleague ministers that “the agreements which we reach, and the nature of the rules will have a direct influence on our trade; the prices of our exports; our access to overseas markets and the conditions which we face there; the cost of our inputs; and the levels of private and public inward capital flows.”
“For all of us dependent on the changing conditions, the economic impact can be decisive. In our case, we anticipate that if we get it wrong with the EPA negotiations and the WTO, not to mention the FTAA, our GDP could decline by at least 15%,” he said.
“We must get it right,” he stressed.
The Minister went on to outline three steps, which could lead to securing the best results for developing countries out of the trade negotiations. First of these was to determine what was genuinely in the interests of the countries. He pointed out that there had been little difference in the experiences of those countries who had followed and those who had rejected the advice of international financial institutions and other agencies on the methods to grow and develop their economies.
“It is for our countries that are familiar with our constraints to determine what we need and what is in our interests in the rapidly evolving regulatory framework,” Mr Hunte said.
The second element he identified as courage to pursue the goals which had been thus defined. “If we are going to accept responsibility in this way, we need to fundamentally rethink our policies and how we seek to pursue them. The relatively laid-back approach to past negotiations whose outcome would not have had the likely far-reaching impact of EPAs or the Doha negotiations (at the level of the WTO), would be virtually suicidal,” Mr Hunte said.
The St Lucian Minister then stressed unity as his third step. “I am not talking here about mere political solidarity but rather the mature realisation that we as an ACP group can achieve more by standing together to safeguard our interests rather than by squabbling among ourselves for a larger share,” he argued.
He urged that the fundamental objectives of the EPAs be kept in focus. This he said was the promotion of economic growth and development in the ACP countries. “It is the trade and regulatory arrangements of the EPA itself which must be conducive to our countries’ growth and development. As a result of the EPA, we should be able to export more and obtain better prices. There should also be a greater flow of inward investment and our productive capacity should be augmented. Unless the EPA can do those things, what will be its purpose – how will it help us?” he asked.
Speaking specifically on the concerns of the Caribbean Region, Minister Hunte said the countries of the Windward Islands in particular were facing an economic crisis as a direct result of the imposition of the WTO principles on the European banana market.
“Already our sister state Dominica has had to resort to the dubious succour of the IMF…….If current trends continue, it will only be a matter of time for the rest of us. We must act and we must do so astutely and quickly, if we are to stem those trends,” he added.
The MTC, which brings together 18 representatives of the 46-member group, will meet on Saturday with the EU Trade Commissioner, Mr Pascal Lamy at the same venue for the Fourth Meeting of the Joint ACP-EU Ministerial Trade Committee. The Negotiations for the EPAs and preparations for the 5th WTO Ministerial Conference to be held in Cancun, Mexico later this year will be the focus of Saturday’s meeting.
