|REPORT OF NATIONAL CIVIL SOCIETY FORUM ON THE EPA|
|Written by Sylvester Bagooro, Political Economy Unit|
|Tuesday, 06 September 2011 12:45|
Date: 25th August 2011
Venue: Alisa Hotel, Accra
The forum, organized by the National Civil Society Platform on the Economic Partnership Agreement (EPA), was a result of a series of meetings aimed at seeking clarification from the Ministry of Trade and Industry (MOTI) on the state of the interim trade deal between Ghana and the EU, and the regional body, ECOWAS and the EU as well. It aimed at raising the concerns of CSOs on the EPA processes as Ghana prepares to host the ECOWAS Ministerial Monitoring Committee Meeting in Accra in September 2011. The forum had Dr. Rose Mensah-Kutin, Executive Director of Abantu for Development, as chairperson and Dr. David Pessey, a consultant to the Ghana National Association of Poultry Farmers, championing the concerns of the private sector. The rest of the speakers, Dr. John Hawkins Asiedu and Gyekye Tanoh represented the Ministry of Trade and Civil society respectively. The programme started at 10:20am and ended by 12:30pm. This report looks at the day’s proceeding. There is an annex to the report which contains the statement released to the press houses, the attendance list and the programme of items during the forum.
2.0 Presentations by Speakers
The chairperson in her opening remarks thanked the CSOs platform on EPAs for inviting her to chair the forum. She recounted how the platform has always been at the forefront of campaigns on the EPAs among others and indicated that this particular forum was timely and appropriate. Without wasting time, she proceeded to the next item on the programme line up which bothered on presentation and entreated all especially the media to listen attentively and articulate the key concerns on the EPAs and inform the good people of Ghana appropriately.
2.1 Presentation by Dr. David Pessey, Private Sector Representative
Dr. David Pessey painted a miserable picture of the poultry industry now as compared to the 1970s when it was booming. He attributed the situation to unbridled liberalization championed by the World Bank and the International Monetary Fund.
He stated that the poultry industry has virtually collapsed over the last decade due to unbridled importation of chicken from Europe and that the ratification of the final EPAs by Ghana would only serve the purpose of getting poultry farmers completely out of business. According to Pessey, the poultry industry used to produce enough to meet domestic needs with its concomitant effects on jobs and wealth creation. However, the story changed ever since the day the government allowed unlimited importation of poultry products. Many job opportunities have been closed in the poultry industry. In his opinion, the country currently exports about 200,000 jobs annually through importation of chicken and that the unemployment situation in the country will worsen if Ghana signs the EPAs.
He put the blame on government for not doing enough to support the poultry farmer by way of subsidy as is currently done in Europe. The cost of imported chicken is relatively cheaper because EU poultry farmers receive heavy subsidy from their governments, get loans at cheaper rates and thereby making it difficult for local poultry farmers to compete.
According to Dr. Pessey, the EPAs which is based on the fiction that the economies of the EU and ECOWAS are on the same footing have been designed to further the interest of Europe and wonders why government of Ghana should ever consider signing the EPAs. He concluded with a call on government to immediately declare its stance on the EPAs – whether it is with the people of Ghana or the Europeans.
For him, the EPA was designed to further the interest of Europe and that there was no basis for the government of Ghana to even be contemplating signing it. Citing the poultry industry, he said, Ghana used to produce enough to meet domestic needs and created jobs for the populace. He made reference to the repealed ACT 641 which was enacted to raise the tariff levels for the protection of local poultry and rice producers but did not see the light of the day. This has rather allowed unlimited importation of poultry products. Hence citizens who toiled to build structures for the production and processing of poultry have gone under the drain because cheap products have flooded the market.
2.2 Presentation by Gyekye Tanoh, CSO Representative
Mr Gyekye Tanoh made the second presentation on behave of the CSOs platform on EPAs and was based on the group`s position on the EPAs. Mr. Tanoh in his presentation argued that the EPAs are a threat to the re-positioning of the national economy as well as regional integration of the Economic Community of West Africa States (ECOWAS) and therefore should be abandoned.
He explained that in a recent ECOWAS - EU negotiations, the EU tried to shoot down the proposed fifth tariff band within the Common External Tariff framework of ECOWAS with threats of WTO sanctions. The EU also demanded further liberalization of the ECOWAS markets beyond the proposed 70% so that they could flood the markets with cheap industrial and agricultural products. To him, what was even worrying was the fact that the EU sought to extend free trade rules into new areas such as health and intermediate inputs but refused to meet the requirement to provide additional funding for the high costs of adjusting to the EPA on West African economies.
He described the IEPAs as a Trojan horse which has the potential of making it easier for the overall EPAs process among others to override, as well as block process towards West Africa`s regional efforts to develop coherent common tariff regimes that provide sufficient developmental space. Besides, the EPAs as a trade regime, threatens to introduce multiple trade regimes in West Africa, a step CSOs consider very dangerous.
According to Tanoh, there were strong signals that Ghana would sign and ratify its IEPA as a substantive bilateral agreement just as Cote d’Ivoire. He said such a move will be detrimental to long-term development goals and aspirations of the country and the sub region as a whole. According to him, countries like Swaziland and Botswana have currently slipped into full blown financial crisis after they had signed the EPAs and that Ghana`s own will not be different if government ignores CSOs concerns and signs the EPAs. In the case of the Southern Africa Customs Union (SACU), the EPAs have a rival trade regime with the current SACU arrangements and this led to the downgrading of Swaziland and Botswana in the sub-regional common customs revenue and distribution scheme.
Gyekye indicated that the group`s position against the EPAs was vindicated by the recent action of EU civil society and pro-development politicians on the EPAs. They are sending strong representations against the EU`s new efforts to use the EPAs and Free Trade Agreements to obtain unrestricted access to Africa`s raw materials and natural resource wealth. According to him a good example was the recent call on the EU to extend the provision of the Everything But Arms programme to goods from poorer developing countries within regional groupings not just LDCs.
Mr. Tanoh urged the government of Ghana to abandon the IEPAs and join the ECOWAS harmonization and integration process as the country`s current approach has introduced confusion in the regional EPAs processes.
He concluded with a call on governments within the sub region to learn from the recent global economic crisis as well as the current Euro- Zone and diversify trade away from over reliance on the EU markets.
2.3 Presentation by Dr. John Hawkins, Government Representative
Dr. John –Hawkins Asiedu a senior economist at the Ministry of Trade and Industry who represented the Minister of Trade and Industry made the last presentation. His presentation was more of a response to the concerns raised by the first two speakers who painted a bleak picture about the Economic Partnership Agreements (EPAs). He started with a brief background of the trade arrangement between the EU and Ghana (ECOWAS).
Dr. Asiedu provided a justification for Ghana initialling the IEPAs in 2007. According to him, Ghana unlike Nigeria (exports oil) exports horticultural products to the EU market and that if Ghana had not initialled the IEPAs, these products would have been slapped with high tariffs. Besides, our exports to Europe would have been faced with stiff competition from Latin American countries. Companies like Blue Skies would have folded up according to the Dr. Asiedu.
However, he admitted that there were some contentious issues in the agreements, but assured the Platform that they were receiving attention from government. He said government is currently making efforts for the IEPAs to be returned to the table for negotiations on the contentious issues.
In his opinion, the biggest challenge the country’s economy faces today is not Europe but Asia especially, China which he said was flooding the Ghanaian market with cheap exports, thereby undermining local manufacturing companies. As a result, he urged CSOs to be rather concerned about this current development and not dwell so much on the EPAs which is been addressed by government.
That notwithstanding, he said government was ready to listen to concerns and contributions from CSOs in order to get a better deal for the nation on the EPAs.
2.3 Reaction from other Forum Members
With regards to the statement made by Dr. Asiedu to the effect that the Asian countries pose more threat to the Ghanaian economy than Europe, Mr Tanoh gave a quick response by saying that the trade arrangement between Ghana and the Asian countries (China) is different in the sense the country has no binding and irreversible trade agreement with them as it will be in the case with the EU. He said under the EPAs, Ghana is expected to surrender almost all protective trade tools which are currently not the case in the Country’s trade with the Asian countries.
A question was asked regarding what would have been the situation with Ghana exports assuming Ghana had not initialled the IEPA.
In his response, Dr. Asiedu gave a catalogue of products (canned tuna, aluminum, pineapples, wood products, vegetables, yam, gari etc with their respective percentage increases) and said they would have attracted tariff increases if Ghana had not initialled the IEPAs. He added that Ghana will still face similar sanctions as a country in case of failure to sign the final EPAs by 2013.
Again, a participant wanted to know in monetary terms the impact of the EPAs on Ghana. His response to this question was that, the country stands to gain about $242 million dollars if we sign the EPAs but will lose revenue to the tune of 13% of national revenue in case of to sign the EPAs.
Finally, there were several other questions that the Minister`s representative though attempted could not give clear cut answers to.
3.0 Interviews and Press Briefing
After the presentation the press men and women were given the opportunity to interview speakers and ask more probing questions from the presenters. The programme had intended a press briefing on the key issues but by the end of the first part of the programme most issues were exhausted. It was therefore decided that the press release would be e-mailed to the media to update their reports in case of need. The Chairperson then brought the event to an end and thanked all present. Participants were then given coupons to go for lunch.
4.0 ANNEX (Press Statement and Attendance List)
4.1 PRESS RELEASE:
National CSO Platform urges Ghana government to abandon interim EPA
Ghana will host the ECOWAS Ministerial Monitoring Committee (MMC) on EPAs in Accra in September 2011. The MMC is the highest EPA authority for ECOWAS and its member–states. In the run up to this, we wish to urgently share a number of growing concerns with Ghanaians.
Ghana IEPA: tool of uncertainty
Ghana initialed a separate IEPA with the European Union (EU) four years ago ostensibly to end uncertainty and protect a very small group of exporters who depend almost exclusively on the EU market as their products would have attracted additional tariffs upon expiration of the preference regime for some Ghanaian and Africa, Caribbean and Pacific (ACP) exports in December 2007.
Much has changed since then, including the onset of a global financial and economic crisis. The other change is in the shifting centre of gravity of the global economy from regions like Europe to East Asia. Our contention is that the IEPA must be abandoned. It is a threat to the re-positioning of the national economy and to regional integration in ECOWAS. We urge the government to do so for the MMC meeting it will host in September.
We also call on the Government of Ghana to expeditiously clear up this damaging uncertainty whose most tangible manifestation is the treacherous existence of the Ghana IEPA alongside the regional ECOWAS EPA positions and process.
The IEPA was also explained as a temporary measure meant to assuage specific issues of non-LDC countries in West Africa such as Cote d’Ivoire, Nigeria and Ghana, pending harmonisation and completion at the ECOWAS level. War-ravaged Cote d’Ivoire has since finalised and ratified its IEPA as a substantive bilateral agreement. This year, Ministry of Trade and Industry officials have echoed the European Commission (EC) Delegation in Accra in giving strong signals that Ghana will follow suit.
The sub-regional economic bloc, ECOWAS which is current headed by another Ghanaian, Victor Gbeho, has rejected the Ghana IEPA as a template for the sub-region. The Ghana IEPA is onerous and indeed inimical to the country’s development and to the region, yet government is threatening to make the IEPA a permanent agreement.
The IEPAs as an additional trade regime will further fragment and eventually derail harmonisation of West Africa’s regional position and regional integration.
As the only country currently in the West Africa region with an IEPA which hangs like a sword of Damocles over ECOWAS as well as over the country’s own broader, longer-term and comprehensive national economic interests (constituted by the needs of all production and livelihood sectors taken together), the Ghana IEPA is today not a tool for allaying uncertainty but rather for magnifying it to dangerous levels.
We therefore urge Ghana Government to reject the IEPAs and join the ECOWAS harmonisation and integration process as the country’s current approach has introduced confusion in these regional EPA processes. Ghana’s current stance further threatens to introduce multiple trade regimes in West Africa, a very dangerous step. Ghana’s position is also holding to ransom the country’s economy and the much larger Ghanaian exporting community that is less dependent on the EU market.
The IEPAs remain a Trojan horse as it will make it easier for the overall EPA process (among others) to override, as well as block progress towards West Africa’s regional efforts to develop coherent common tariff regimes that provide sufficient developmental space (even the small step towards to trying to implement a 5th band in the ECOWAS Common External Tariff is being blocked by the EU), the EU’s demands and pressure in areas that go beyond tariffs and WTO commitments – such as Financial Services, Public Procurement, Investment, Health, Raw Materials and Natural Resources - pose even greater threats and are of more strategic importance to Africa’s economic transformation, industrialization and overall development.
The unprecedented trade and economic liberalization commitments that the EU is seeking to impose on Africa’s regions as well as the institutional predominance of EPA mechanisms over Africa’s own regional arrangements are a clear and present danger to the kind of self-defined developmental Regional Integration whose prioritization and necessity has been even more starkly affirmed by the ongoing global Crises.
EPAs in current global economic context
One of the main lessons of the global economic crisis that has cast its shadow since 2008 is that this is the time to be diversifying trade away from over-reliance on EU markets. It is clear to all observers that the economic chaos engulfing the EU in its euro-zone heartlands shows no end in sight and the prospect of long- term stagnation is becoming ever more real.
A second lesson is that autonomous Regional Integration and the upgrading of domestic market linkages within such a framework is the best bulwark against external shocks and for recovery from such global recessions. It is also increasingly recognised as the best orientation for long-term sustained growth as well as economic transformation.
Today, more than 90 per cent of Ghana’s most dynamic manufacturing exports go to the West Africa sub-region. As we have already discussed, the EPAs directly undermine this. The third lesson of the global crisis is the enduring problem of our continued primary commodity dependence. The EPAs constitute the most important barrier to every one of these possibilities.
This is clearly not the time to lock Ghana and ECOWAS’ long-term trade and development prospects into an irreversible agreement that gives EU trade preference over every other trade partner. – END.
There are growing examples of how deeply problematic the EPAs are proving for developing countries and regions. The official position of the Conference of African Trade Ministers held in Kigali towards the end of last year highlighted several of these problems and threats
The most recent ECOWAS-EU negotiation sessions in Brussels last June show how intractable these problems are. Yet the EU continues to push for more. In the June Brussels sessions, the EU tried to shoot down Common External Tariff framework ECOWAS is developing and implement with threats of WTO sanctions.
The EU further demanded liberalisation of market access for its goods than the 70 per cent ECOWAS is offering, which expert opinion considers as already too high and uncompetitive for West Africa. Ghana’s market opening to the EU in the IEPA is much higher, at 80.5 per cent. This is one of the reasons why ECOWAS rejected the Ghana IEPA as a template, and why the continued existence of the Ghana IEPA poses a huge problem for the country and the sub-region.
The EU also sought to extend free trade rules into new areas such as health and “intermediate inputs”, which includes access to strategic raw materials and natural resources. But at the same time, the EU refuses to meet the requirement to provide additional funding for the high costs of adjusting to the EPA on our economies.
Just how high these costs are and will be is already becoming evident elsewhere in Africa. The government of Swaziland has slipped into a full-blown fiscal crisis as a result of how its entry into an IEPA with its introduction of a rival trade regime to the existing SACU arrangements led to a downgrading of Swaziland in the sub-regional common customs revenue and distribution scheme.
Swaziland depends on regional customs and trade duties for 70 per cent of total government revenue. Even Botswana has suffered fiscal tightening under similar circumstances. Botswana receives 30 per cent of government revenue from SACU, at the same time that it has suffered from the decline of export demand for its diamonds. These national losses are in addition to the setback that the region’s integration has suffered as a whole, as well as, the negative costs of the global crisis emanating from the US and EU in particular. Rather than an EPA providing better markets and additional funding and revenue, it has been the transmitter of crisis and disintegration of economies and regions in Africa.
Kenya has re-opened studies on the real quantum of marginal tariff increments that a General System of Preference (GSP) regime, rather than an IEPA, will add to a small share of Kenyan exports to EU and to examine alternative options for how to address or absorb this.
The Namibian Government has refused to sign the EPA due to its inimical nature to the development of Namibia. In particular, they are concerned about entrenching Namibia’s heavy reliance on the EU beef export market even further, something the government and society recognise as a major weakness. The Namibian Cabinet decided that future exports should not rely on one export destination and that no single export destination should constitute more than 50 per cent of all exports of a specific commodity. Following this the meat Board of Namibia has commissioned a market diversification study to identify new potential export markets. The Government has also decided to absorb the losses of the meat industry for the next three years. Within this period the local exporters are required to diversify and look for alternative markets.
Again, according to the Trade Minister in Namibia, Hon. Hage Geingob, ‘Namibia would also have to abandon our current system of infant industry protection, in favour of a much weaker system demanded by the EC. This requirement goes directly against our efforts to industrialize, and would leave several industries that are currently benefitting from such protection completely exposed. We may have to wave goodbye to our diary and pasta industries. I fear that all our past investments in the Green Scheme, horticultural marketing, grain storage, agricultural extension and value addition to food products would be lost and we would seriously disrupt rural economies and the livelihoods of thousands of small farmers. This alone is actually reason enough not to sign this agreement. We should not be expected by people calling themselves our friends to create such instability in our rural areas!’
The EPAs will not promote industrialization and structural transformation of African economies but will lock us deeper into a primary commodity dependence trap. The Government must explain how the EPAs will help rather than hinder its new Industrial policy and Ghana’s industrialization imperatives. It must also explain how its own IEPA will help the harmonization of ECOWAS integration.
Table 1: Participants List
Table 2: Media List
4.3 Public Forum on EPA, Thursday, 25th August 2011
Arrival, Registration & Refreshment 9:45am
Introduction and opening remarks 10:00am- 10:05am
v Presentation by Private Sector Representative: Dr. David Pessey 15 Minutes
v Presentation by CSO Representative: Gyekye Tanoh 15 minutes
v Presentation by the Honourable Minister of Trade and Industry 25 minutes
Comments and questions 30 Minutes
Chairperson’s remarks 11:30am
Part II 11: 45 am
Media briefing on key issues on the EPA 15 minutes
Questions and comments 12:00pm
End of Programme 12:15pm
Lunch and Departure
 The National CSO platform on EPAs convened a stakeholders’ forum on the Ghana Interim EPA process in Accra on August 25, 2011. The platform is also a part of the Ghana Economic Justice Network (EJN)
|Last Updated ( Tuesday, 06 September 2011 12:52 )|
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