Maravi

EPAs worry small-scale farmers

EPAs worry small-scale farmers
By Joan Chirwa
Tuesday June 10, 2008 [04:00]

SMALL scale farmers will completely lose out on markets once governments in the region decide to hurriedly sign Economic Partnership Agreements (EPAs) this December, East and Southern Africa Small Scale Farmers Forum (ESAFF) has observed. And Consumer Unity and Trust Society (CUTS) Zambia coordinator Angela Mulenga has called for the discontinuation of EPA negotiations to safeguard interests of small scale farmers in Eastern and Southern (ESA) region.

ESA and the African, Caribbean, Pacific (ACP) countries have between now and December this year to concretise discussions with the European Union (EU) as they move towards the full implementation of the EPAs.

Several countries have signed interim EPAs, but stakeholders have questioned the idea behind the move since ESA and ACP still have a lot of issues to iron out before the trade arrangement takes effect.

“Farmers in the region look at the EPAs like a relationship between two unequal partners. The EU is hurrying us to sign the EPAs by December this year but when we look at advantages European farmers, it will be difficult for us to compete because our colleagues are heavily subsidised,” said Mubanga Kasakula, ESAFF’s regional vice-chairperson. “Small scale farmers in the region will lose even the little market that exists if we allow the EPAs to be signed.

For example, here in Zambia, we are already complaining about the number of goods flooding our markets from within the region. So if we fail to trade within the region, how possible will it be for us to compete at international markets such as those in the EU?”

In September 2002, the European Union and the ACP countries officially opened negotiations on EPAs in Brussels, which would have taken place over a five year period, were aimed at redefining the trade regime between the two groups of countries. Some considered that EPAs have the potential to offer the ACP countries good opportunities while others foresaw much soul-searching when it came to ensuring an improvement over the former system in terms of development prospects for the ACP countries.

From January 1, 2008, the waiver obtained from the WTO at the Doha ministerial conference would have come to an end to be replaced by a new framework that must be compatible with World Trade Organisation (WTO) rules, but this target was missed owing to unresolved differences in the trade negotiations between the EU and ACP countries.

The European Commission (EC) market access offered to the ACP countries under EPAs consists of duty-free, quota-free treatment for all imports. This treatment would apply from entry into force of the agreements for all products except for sugar and rice, whose duty-free, quota-free treatment would be phased over a transition period.

ACP countries have insisted that the EU should build capacity of African countries before the EPAs are concluded to ensure fair reciprocity in trade. In practical terms, ACP countries cannot adequately compete with the EU in trade due to the formers’ poor infrastructure and diverse socio-economic problems being faced by several countries.

In terms of trade in agriculture, there is a very big production gap between EU and ACP countries as the former heavily subsidises its farmers while the scenario is totally different for the latter. Agriculture, predominantly composed of small-scale farmers in most ACP countries, has not yet reached its peak and developing nations say allowing competition with already developed industries would hurt the local producers.

During negotiations, the ACP countries have raised concerns regarding the impact and benefits of small-scale farmers from the proposed EPAs and regional trade arrangements. Activists for pro-poor trade arrangements argue that the market liberalization of agricultural trade and the speedy process of regional integration under EPAs would worsen poverty levels in rural areas where most of the people depend on agriculture for their livelihood, as is the case in Zambia.

In Zambia, the small-scale farmers continue to account for the largest amount of total maize production of around 1.2 million metric tones, with 82 per cent while the remaining portion is produced by commercial farmers. This means small-scale farmers also need to be at the centre of trade negotiations on agriculture under EPAs.

It is also argued that the EU is pushing for an agreement on agricultural issues that have not been resolved in the Doha Round of trade negotiations being spearheaded by the WTO, and ACP countries are opposing this.

“Governments in the region should re-plan and reconsider the decision they are about to take in terms of signing the full EPAs this December,” Kasakula said. “People involved in production at a small-scale level but these have not been consulted in any way.”

As a result of the foregoing, ESAFF organised a two-day regional workshop in Lusaka where Kenya, Zambia and Zimbabwe were represented. The meeting aimed at increasing awareness on EPAs and regional integration among small-scale farmers as well as provides a forum for farmers to raise and share concerns on constraints to regional and local market access and analyse implications of EPAs on small-scale producers.

Recent assessment indicate that Zambia is expected to lose US $15.8 million (approximately K62.4 billion) resulting from the elimination of tariffs through the EPAs.

Countries in ESA are set to lose US$ 212 million worth of trade with one another, while the EU would increase its exports to the region by US $1.1 billion as a result of the EPAs. With limited sources of domestic revenue and tax bases, tariffs are one key sources of revenue for African countries. According to the World Bank, tariff revenues in sub-Saharan Africa average 7-10 per cent of government revenue, thus relying on import taxes to contribute to revenue to finance public services.

And Mulenga said there is need to lobby for EPAs to be coherent with national poverty reduction strategies and national development plans.

“The Ministry of Finance becomes key at this stage,” Mulenga said. “There is need to stop EPAs before December 2008 to safeguard the interest of the small farmers and save livelihoods of small farmers in ESA region.”

Mulenga said development in EPAs could only be achieved if there is increased international financial and technical assistance to assist small farmers to improve production and enhance trade capacities.

“Therefore, the EU needs to live up to its commitment to provide additional funds and not to ask member states. It would be ideal for each member country to develop strategies of accessing the funds being proposed in the current negotiations. These then would feed into the regional resource mobilization strategy,” Mulenga said. “Small farmers are usually left out hence need to find space so that their concerns are included in the various Funds being proposed.”

ESA countries have been asked to establish an ESA fund through the COMESA fund, but Mulenga says mobilization of funds might be difficult as most member states have bilateral agreements with individual ESA countries.

As of April 2008, the EC proposed that additional funds be mobilisd from the member states, hence the need to finalise a detailed costed development matrix.

Labels: CUTS, EPAs, FARMERS

posted by MrK @ 4:43 AM