Free Trade agreement deepening Africa’s poverty

Lesotho Times
7 Min Read

Last week, a tripartite dialogue reflecting on relations between government, civil society and European Union (EU), was held in Lesotho. Unfortunately, for reasons beyond my control, I only observed a very small part of it. To my dismay however, I sensed and observed from the discourse, a game between ‘unequals’ and diametrically opposed mind-sets. The short and little time I spent in the conference room left me devastated. 

Dubbed ‘Experiences from Lesotho and beyond’, the conference aimed at drawing Lesotho’s attention to the following: key national policy issues, opportunities and challenges identified through previously held five seminars on regional frameworks (inclusive of Cotonou Partnership Agreement).

Cotonou is a 20-year agreement between a group of African member states, Caribbean and Pacific (ACP) as opposed to European Community (EC) member states.

When considering a key framework that governs relations between Lesotho and Europe, it seems to have a potential to provide platform for North-South Non-State Actors (NSA) cooperation and influence; it introduces important changes and ambitious objectives while preserving ACP-EC’s years of cooperation experience. Comparatively, according to analysts, latest agreement represents further progress in a number of aspects.

Unlike predecessors (eg Lomé Convention), it is designed to establish comprehensive partnership with complementary cooperation pillars on which it is based on: development, economic, trade cooperation, and political.

NSA, a term brought into currency by international relations theorists, implies civil society organisations, non-governmental organisations, firms and businesses, multinational corporations and media.

In a broad-sense it also includes dangerous elements all of which are desperately knocking at our doors in a form of internationally organised crime syndicates, paramilitary terrorist groups and Mafia.

As I sat quietly observing proceedings, I had an impression that unless organised civil society gets its act together soon, the dialogue could potentially sow seeds of self-destruction as self-serving groups and tendencies eventually creep into Lesotho. Under conditions of inequality in intellectual discourse and serious economic disparities between parties, suspicions of coercion arise.

I caution that the very existence of Lesotho Council of NGOs (LCN) for which so many worked hard to establish, could become history, and organised crime could reign supreme unabated.

If I had my way, burning issues preoccupying participants that ought to meaningfully include implications for Lesotho of on-going development cooperation discourses between the EU on the one hand, and both Sadc and Sacu on the other.

Since trade and development are at the heart of Cotonou, weaker parties could seriously be harmed, their markets destroyed and poverty definitely worsened.

This calls into question the critical issue of the extent to which those who proclaim to represent the poor, marginalised and vulnerable groups of society are up to scratch when chips are down.

When parties engage into trade and development dialogue, and ultimately come to consensus, what follows is either binding agreement or conditionality, a notion dominating official EU discourse. Conditionality is a practice of setting conditions for provision of a good from one actor or organisation to another, perhaps a combination of functioning market economy with institutional protection of democracy, human rights and the rule of law.

Important and ambitious Cotonou objectives notwithstanding, there are challenges and opportunities that are likely to be faced by economies and people of southern Africa.

While possible regional economic gains are acknowledged (and to a lesser extent NSAs empowerment), there also are downsides to be understood and guarded against.

The EU is the largest global trading bloc and stronghold for development assistance for ACP. Potential economic benefits from Cotonou exist through increased EU market access and financial aid aimed at poverty reduction. However, agreement cannot be properly understood without reference to downsides, fundamental flaws and reality on the ground.

Analysts contend that while Cotonou’s main pillar is poverty reduction, Africa’s aid allocation under 9th and 10th European Development Funds (EDF) has had limited impact on majority of the poor. This translates into development cooperation which is no more than a function of long-term strategic interests of its members, rendering it an instrument with ability to tap ACP nation’s resource endowment and outlet for subsidised agricultural products.

According to Oxfam International, an NGO working to find lasting solutions to poverty and injustice, the EU is playing hardball in Economic Partnership Agreements (EPAs) negotiations by actually putting commercial self-interests before development needs.

On a larger scale of things, EPA’s could undermine rather than advance multilateralism. Firstly, by forcing ACP farmers and producers into direct and unfair competition with efficient and highly subsidised EU producers; secondly, by severely undermining ACP regional integration; and thirdly, by making ACP governments lose substantial revenue along with many policy tools needed to support economic and social development.

Oxfam’s argument is in accordance with Third World Network’s (TWN) assessment regarding development and North-South affairs. EU–ACP driven EPAs could potentially bring ramifications and harm to the development prospects of many of poorest countries. In their 2006 ‘Make Trade Fair Campaign’-related article, Oxfam quotes TWN’s caption of Ghanaian fisherman from small village who laments that free trade agreements, especially EPAs, were deepening Africa’s poverty rather than leading to sustainable development.

Consequent to EPAs, Ghanaian generations’ fishing and poultry based livelihood had become threatened by EU. Larger and more efficient vessels were fishing their seas empty, and imports of frozen chicken wings had destroyed their local market.

Lesotho’s Non-state actors need to take a leaf out of the likes of Oxfam and TWN, and seriously engage with EU and government on respective development policies and agenda to ensure that they project voice of the poor and disadvantaged. More strategically, preserve the LCN, some of  us come from a long way with it.

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