The EC has posted a background document as part of a public consultation on its forthcoming ‘Trade and Development Communication’, seeking contributions from stakeholders both in the EU and in the EU’s developing country partners. The new communication will aim to build on the September 2002 communication, ‘Assisting developing countries to benefit from trade’. In this earlier communication the EC argued that ‘trade can foster growth and poverty reduction, and be an important catalyst for sustainable development’. It argued for:
- ‘effective market access in favour of developing countries’;
- the importance of regional market integration;
- the need for a rules-based multilateral trading system consolidated through the successful pursuit of the Doha development agenda;
- the centrality of ‘the complementarity and coherence of trade, development and other policies at national and international level’;
- the provision of trade related assistance for developing countries.
Key developments since 2002 now make it important to update this policy framework, including:
- the continuing rise of certain advanced developing countries within the global trading system;
- the impact of the 2008–09 financial and economic crisis and food and energy price volatility on developing countries, and hence the need to enhance agriculture and food security in developing countries;
- the recognition of the importance of ‘sequencing when designing trade liberalisation schemes and the limits of a one-size-fits-all solutions’;
- ‘a better recognition of the importance of stimulating the conditions for sustainable entrepreneurship through flanking policies and regulations, including better institutions, support measures (aid for trade) and mobilising domestic resources’;
- better accommodating the role of the private sector;
- the evolution of EU policy on bilateral and regional trade negotiations;
- the ongoing failure to conclude the Doha Round;
- the evolution of the EU’s ‘aid for trade’ strategy;
- the inclusion of a formal legal commitment in the Lisbon Treaty to ‘take account of the objectives of development cooperation in the policies that it implements which are likely to affect developing countries’.
These developments need to be seen in the light of the EU’s belief that trade should drive improvements in social inclusion globally and, within the EU, should ensure that the position of the poorest countries are improved and that global resources are managed sustainably.
The EC consultation document lists a wide range of related communications and initiatives that need to be taken into account, including the EU’s 2007 ‘aid for trade’ strategy; the 2009 trade and development conference; the EU’s 2010 trade policy communication; the 2010 reflection of the future of EU development policy; and several issue-specific communications.
The stated aim of the proposed communication is ‘to optimise all opportunities to boost inclusive growth and reduce poverty’. Key issues identified in the document include ‘the role of the EU in supporting a positive relationship between trade and sustainable development’ and ‘the EU’s approach to dealing with an increasingly differentiated developing world’.
The Commission has invited inputs to the consultation process to be sent to: TRADE-and-DEV-Communication@ec.europe.eu.
While the consultation lists recent related Commission initiatives that provide the background to the consultation process, the document makes no reference to the process of preparing the 2013 round of CAP reforms. From an ACP agricultural sector perspective, this can be seen as significant area of omission in getting to grips with the policy coherence dimension of the pending trade and development communication. Critical areas in this regard include the need to address the external effects of CAP reform on ACP food and agricultural sectors (via the erosion of the value of traditional agricultural trade preferences, the increase in costs associated with serving the EU market resulting from stricter SPS and food safety regulations, and the enhanced competitiveness of EU exporters on food and agricultural markets).
In addition there is a perceived need across the ACP for the EU to address further the process of erosion of margins of ACP tariff preferences arising from the EU’s evolving policy on preferential trade arrangements with non-ACP countries. It is thought that such support should assist ACP economies in repositioning themselves in the light of evolving trade realities.
Elements of such a comprehensive response are already evident in certain EU policy initiatives and ‘aid for trade’ programmes (e.g. the EU funded restructuring programme of the Caribbean rum sector). They range from targeted programmes of support for meeting SPS and food safety standards to assistance to private sector based production and market restructuring programmes. The challenge is to generalise these and similar successful initiatives, and extend them to embrace dialogue around a growing number of non-tariff issues that impact on the costs that ACP states incur in exporting to the EU. These non-tariff issues range from the locally relevant application of food safety (horticulture) and animal welfare standards (beef), to a dialogue on a non-discriminatory agricultural product quality policy and the specific policy tools that can be effectively used to strengthen the functioning of agricultural supply chains.
Rising food prices and increased agricultural commodity price volatility have given rise to a greater focus on agricultural development and food security issues across the ACP. This would appear to require an intensified dialogue and greater flexibility in establishing transparent and accountable frameworks for the deployment of a range of non-tariff trade policy tools for the promotion of agricultural development and national and regional food security.