Menu

Africa must go beyond objection to social obligations in international trade agreements 18 Aug 2024

Fundamental understanding of the real issues in international trade agreements and development aid is necessary in discussing the ‘Samoa Agreement’, a partnership agreement between the European Union (EU) and the member-states of the Organisation of African, Caribbean, and Pacific States (OACPS) signed in Apia, the capital city of the South Pacific island state of Samoa, on 15 November 2023.

This crucial understanding has been missing in most of the conversations in Nigeria about the agreement, which the government signed on 28 June 2024. Certain provisions of the Samoa Agreement was deemed controversial, necessitating pushback from individuals and groups. However, the agitation has shown very limited engagement of the power imbalance in EU-Africa relations. It also ignores other substantive and grave areas of concerns that Africa’s partnership with the EU, through the instrumentality of the Economic Partnership Agreements (EPAs), raise.

The EU and Africa are major trading partners. In 2019, before the Covid-19 pandemic, which adversely affected global supply chains, trade between the EU and Africa reached €280 billion. According to Eurostat, the EU is Africa’s first trading partner and its largest export market ahead of China, India and the United States. The EU is the main trading partner to North Africa and the second-largest partner to Sub Saharan Africa (SSA), after China. Africa is the EU’s fourth-largest trading partner after the United States, China, and the United Kingdom. In SSA, West Africa is the EU’s largest trading partner and the main export market for the sub-region’s fuels and food exports.

Trade relations between the EU and Africa date back to the 1960s, when the first ever convention known as the Yaounde Convention – which conferred an association between Europe and Africa on the basis of “free trade” and “financial aid” – was signed. The Lome Convention replaced the Yaounde Convention in 1975, mainly to rectify the priority it gave to Francophone countries. This agreement was reviewed every five years until the fourth convention expired and was replaced by the Cotonou Agreement.

The Cotonou Partnership Agreement was necessary to align it with the World Trade Organisation (WTO) regulations, especially the reciprocity and non-discrimination principles. It was signed by the then 15 member states of the EU and the 77 member states of the African, Caribbean, and Pacific (ACP) group of states in 2000. It was a 20-year agreement with a clause allowing its revision every five years and was, therefore, revised in 2005 and again in 2010. The partnership agreement was due to expire in February 2020 but was extended until either a new agreement could be concluded or by 31October 2023.

The main features of the Cotonou Agreement were elimination of tariffs, creation of free trade areas, and reciprocal market access. A substantial change that began with the agreement was its articles which allowed the EU to regulate political behaviour of the ACP group of states in matters of democracy, human rights, and the rule of law. In April 2020, the ACP group of states officially became the OACPS under the revised Georgetown Agreement, and, in November 2023, the Samoa Agreement was signed to replace the Cotonou Agreement.

The Samoa Agreement articulates the EU’s economic and trade relations with 79 countries (47 in Africa, 16 in the Caribbean, and 15 in the Pacific, plus the Republic of Maldives). The structure of the partnership consists of one foundation agreement binding all parties and three regional protocols for each of the sub-regions of ACP – focusing on their different priorities. Generally, the agreement focuses on the following six key areas of priorities: human rights, democracy, and governance; peace and security; human and social development; inclusive, sustainable economic growth and development; environmental sustainability and climate change; and migration and mobility.

There has been a slow adoption and signing of the Samoa Agreement by the OACPS states. In November 2023 when it was first executed, 30 OACPS member states, mostly from the African and Caribbean regions, refused to sign the agreement. They stated the need to confirm that its provisions were compatible with their legal regimes, especially the provisions on sexual health rights. This is not particularly surprising. During the negotiations, sexual and reproductive health rights and migration were reportedly part of the key issues which negotiators experienced difficulty finding agreement on.

ACP member states were reluctant when the foundation agreement mentioned sexual orientation and gender identity (LGBTI) rights as enforceable in the member states. It was reported that negotiators were able to reach a compromise where parties’ commitment was restricted to the implementation of existing international agreements – notably the United Nation’s International Conference on Population and Development Programme of Action, especially its provisions on sexual and reproductive health rights, and the Beijing Declaration and Platform for Action on gender equality and women empowerment.

However, this compromise has not proven to be effective. Parliamentarians and heads of state and government of African and Caribbean countries have largely continued to resist the agreement on the grounds that it is capable of superseding their respective national laws and imposing reproductive (abortion) and LGBTI rights as enforceable in their countries. The EU has been accused of ‘blackmailing’ African and Caribbean countries with these conditions.

The hostile reactions of African countries to the Samoa Agreement, because of the sexual and reproductive rights provisions, underscore the lack of depth that has kept Africa as an unequal trading partner even after decades of negotiating EPAs with the EU. First and foremost, although the agenda of EPAs usually include commercial subject-matters, such as trade in goods and services, intellectual property rights, customs regimes, investment regulations and protections and competition, the agreements also provide a powerful means for a more developed state party to nurture a shared understanding with the other contracting countries on non-core economic matters, such as environmental, digital, political, and social goals. Wielding greater negotiating powers, such advanced countries can insist on these sociopolitical and environmental goals as enabled by the power asymmetry in the negotiations.

Rather than defending their social, cultural, or moral norms, African and the Caribbean countries should focus on how to tilt the dynamics of their trade negotiations in their favour. After decades of negotiating trade partnership agreements, they should not remain on the back foot. Nevertheless, it is important to note that differences in economic power, coupled with the history of colonialism, prevent any EPA with the EU from being a partnership of true equals for these countries. Also, the ongoing relations continue to weaken the ability of the African continent to garner substantial bargaining power.

For the EU, EPAs primarily serve as an opportunity to secure preferential access to African and other markets, thereby enhancing the European economic leverage. But for the developing nations, including Nigeria, the agreements present an unending balancing act between fostering economic development and sovereignty. While EPAs and other international aid-related agreements offer economic opportunities, they equally encourage external dependency, which invariably erodes national autonomy in economic decision-making. Many critics have thus argued that such agreements perpetuate a neocolonial economic relationship, where African nations remain subservient to Western economic interests under the guise of development assistance.

The EPAs have exposed African economies to adverse effects such as reduction in import duties and customs tariffs, leading to significant shortfalls in public revenue. They also tend to promote unfair competition, with the imported European products undermining local infant industries.

The mutual exchange of obligations in many international trade agreements tends to have different impacts on the two sets of contracting parties. For instance, the Most Favoured Nation Clause, (which prevents a contracting party from offering ‘better’ conditions of trade to any other developed country or bloc without extending same to the counterparty in the EPA), National Treatment Clause (which obliges contracting state parties to treat locally produced goods and foreign goods within their territories the same), and elimination of export prohibitions and restrictions clauses prescribed for EPAs under the WTO rules all have different impacts on European and African parties by virtue of their different levels of economic development.

To address these issues, it is essential for African nations to go beyond rhetoric and embrace strategic pragmatism and proactive policymaking. Nigeria, like most other developing nations, faces the dual challenge of navigating global economic integration while safeguarding its national interests and sovereignty. It must negotiate EPAs and development partnerships with its own set of underlying principles such as empowering local economies, promoting regional integration and sustainable development that eliminates dependency on external aid, and fostering inclusive growth for all citizens.

It is by addressing our own role in perpetuating structural inequalities and economic inefficiencies domestically that we can become a better negotiating party at the table. Our inability to harness our own resources for sustainable development undermines our bargaining power in international negotiations. Africa, under its EPAs, still mostly exports its raw materials and imports industrialised or finished products. Our inability to enact and implement coherent domestic policies that promote economic diversification, industrialisation, and inclusive growth affects our ability to negotiate great trade deals internationally.
 
African nations must also intensify its collaborative efforts within regional blocs such as ECOWAS to enhance intra-African trade, promote economic diversification, and mitigate the adverse effects of external trade liberalisation. By harmonising policies and enhancing infrastructure connectivity, African nations can collectively negotiate more favourable terms in international trade agreements.

The EU appears to want to maximise its benefit by negotiating trade agreements with regions and economic blocs within them. Apart from the foundational agreement, the Samoa Agreement has three agreements with each region of the OACPS. The EU also has EPAs with different blocs in Africa. In June 2016, it signed an EPA with the Southern Africa Development Community (SADC), which comprises Botswana, Lesotho, Mozambique, Namibia, South Africa, and Eswatini. The EU also has interim EPAs with Eastern and Southern Africa (ESA) countries comprising Madagascar, Mauritius, Seychelles, and Zimbabwe. These may have the effect of creating competition rather than unifying African nations in trade.

Given the EPAs already signed with the African regions, it is pertinent to ask how much each African country involved does really have left to offer under the African Continental Free Trade Agreement (AfCFTA).

As for Nigeria, it needs to take another look at the Samoa Agreement, the EPAs, and the other so-called international trade assistance frameworks and not just the social obligations in them. We need to ensure that our trade agreements are not keeping us in a permanent cycle of economic dependency. The country, together with other nations in Africa, needs to strategically determine the long-term economic goals of the continent. These should begin to underly the principles by which African countries negotiate international partnership agreements.

Funmilayo Odude is Partner at Commercial and Energy Law Practice (CANDELP).