EU-development policies

1. EU-development policies From paternalistic preferential policies to neoliberal “normalization”?

2. A colonial past to clean • Europe: the paramount example of imperialism, colonisation, cultural superiority, ethnocentrism and depredation • At the same time: expansion of cultural parameters with the ambition of universalism: democracy, human rights, human values, etc. • Decolonisation: looking for a balance between control (own interests) and assistance

3. Decolonisation: new ties • After the Second WW: third wave of independence • Forging new relations with the ex-colonies: the Commonwealth and the French Community • 1957: Treaty of Rome: provisions for the association of dependency signatories: the ACP

4. Model: example of regulated-fair North-South relations • EU-ACP: non- reciprocal trade preferences • semi-automatic system of financial compensation for unstable export earnings in agriculture-mining products: STABEX, SYSMIN • institutional dialogue

5. BACKGROUND OF COOPERATION EC-LOMÉ • Yaundé Conventions: from the 50s to 1973 with the entrance of GB to EC. • Historical colonial links: pyramid: hierarchical preferences according to former colonial links • tensions: coordination: bilateral against multilateral policies • financial arrangements: distinction between European development Fund (EDF) financed directly by EU members and Development cooperation programs from EUs budget. • EDF +Aid budget= 10% of total EUs budget

6. COOPERATION EC-EU-ACP • Lomé I: 1975-80 • Lomé II: 1980-85 • Lomé III 1985-90 • Lomé IV signed 1989 into force: 1991: duration 10 years • Lomé IV B: Nov 1995 (revision of Lomé IV) • Cotonou: 2000-2020 (1st period: 2000-2007)

7. Lomé • General: Privileged relationship between EU and developing countries: 15 EU +71 ACP. Model for N-S relations? EU represented by the European Commission mainly. • Based on discriminatory trade preferences now incompatible with WTO. • Dilemma: how to encourage ACP’s integration to globalisation while maintaining a special relationship? How to evaluate success? Africa’s real income p/capita in 1994 below that in 1975. But without Lomé: better?

8. Lomé: some traits • Non-programmable aid: horizontal schemes available to all ACP countries: Stabex and Sysmin, + aid for emergencies and disaster relief also administered by EC • Lomé IV and IVB: structural adjustment aid for implementation of macro-economic reforms (since 88: close links EU+ IMF and WB) • -Sectoral import programmes to help ACP pay for imports, paid in local currency into counterpart fund used for new projects

9. EC, EU- LOMÉ: Economic assesment • enormous task: small means: 90s: annual average contribution: 4 euros for each ACP citizen. But still: fundamental • typical model N-S relations: manufactures-for raw materials. ACP wants to change it but how? • during the cold war: a cheap way to ensure ACP’s loyalty? But afterwards: ideological and political motivations decrease?

10. Other benefits • helping to build common platforms among Lomé countries: from an artificial entity to a new international actor within WTO and UN. • other non-state actors gain space: private sector, NGOs, civil society in general • within CFSP: Lomé helps to enhance peace and security schemes in Africa and to coordinate responses to crises/disasters. Lomé becomes a diplomatic instrument.

11. Development assistance • EDF: largest source of non-reimboursement aid to ACP states • 1996-2000: 14.6 bill euros +soft loans from EIB • same period: Medit. Countries: 4.7 bill euros, Central-Eastern Europé: 6.7 bill euros

12. Total resource-flows from donors • Resources from DAC (Development assistance Committee within OECD) increases during the 90s but half  private transfers to investment in China, India, Indonesia, Thailand. • ODA (official development assistance) in general: decreases but within EU: constant or increases

13. Trade: • preferential access for 95% of ACP export to EU market, for 100 of tropical commodities, all industrial and mineral products, fish products • better terms of trade than with other development countries although they have deteriorated since 1975 • but: against GATT/WTO rules that forbids discriminatory preferences

14. Preferential trade-unsuccessful? • ACP share of world market • from 20.8% in 1975 to 9.7% in 1995 • ACP share of EU market: • From 7% in 1975 to 2.8 % in 1995 • ACP share of EUs import from LDCs 14% in 1990 to 9% in 1995 (other LDCs: 9.4 %in 1974 to 17% in 1989)

15. Other assessments • But individual products as coffee: 38%of EU market and cocoa: 79% in 1993. • Some countries: success stories • Reflection of stagnant demand and prices more than a lack of success?

16. Maastricht • first legal basis for development cooperation (from 1957-92 separate programs) + EU policies coexist with ineffective coordination. • Goal within EU since 1993: 0.7% of GDP • 1998: only 3 countries: Denmark 0.88%, Sweden: 0.87%, Netherlands: 0.98%. • Average for EU: 0.44% (according to Monterrey information: only 0.2%, except Greece)= more than ½ of world’s ODA in the 1990s European • Japan: 0.31%, USA: 0.21% (Bush announces US doll 5,000 million US in Monterrey)

17. Goals of EUs development cooperation • sustainable economic-social development • smooth and gradual integration of developing countries into the world economy • campaign against poverty • promotion of democracy, rule of the law • respect of human rights and fundamental freedoms

18. Principles within EU: • complementarity between EUs cooperation policy and member countries policies. • coordination between EU members states and the Union’s policies.

19. Principles governing the cooperation arrangements • respect for sovereign equality • predictability: access to EU market and funds • contractuality: degree of security for both governments and private enterprises in the implementation of measures.

20. Priorities: • alleviation of poverty’ • support for ACP competitiveness • increase employment and regional cooperation

21. Goals of EU in relation to ACP • strong political dialogue • help to increase democracy, good governance • peaceful settlement of conflicts, more participation of civil society • implementation of SAPs • help in creating private and public institutions • social dimension of cooperation

22. May 1992: European Council’s decision on principles • that all cooperation and association agreements concluded with member countries of CSCE (Conference on Security and Cooperation in Europé) should have a suspension clause in case of violation of human rights or democratic principles and principles of market economy. Agreements with Eastern Europé 1992-3 had two elements: ’essential element’ and ’non fulfilment clause’.

23. Essential element • Stronger legal basis for implementation of political conditionality. Introduced in agreements with Eastern European and non-European countries: LA: Andean countries, Brazil 1992 and CA 1993, Asia: India1993, Sri Lanka 1994, Africa: South Africa 1994, Tunisia 1994

24. Human rights and democracy-essential elements • 1992: development of hr as “essential element” of the agreements • 1995: EC adopts, in response to a EP’s initiative, a communiqué on the inclusion of hr and democracy in EUs agreements with other countries • essential elements and conditionality are also included in agreements on technical and financial assistance.

25. Goals EU from the 90s on • new strategies for private sector • environmental concerns • development cooperation—transition to integration into world economy • increase in scientific-technological cooperation • regionalized cooperation • differentiated cooperation according to development levels • greater efficiency in cooperation: easier access for new agents

26. Types of Aid-Trade relationships • 1) 1975-2000 Lomé and afterwards: originally 12 EC + 46 ACP countries. Late 90s: 15 EU + 71 ACP • 2) Euro-Mediterranean partnership: bilateral aid-trade EU-12 Mediterranean countries (Morocco, Algeria, Tunisia, Egypt, Jordan. Malta, Cyprus, Israel, Lebanon, Syria, Turkey, Yugoslavia). 1995 a new framework replaces individual deals existing since the 50s. Long term plans: Mediterranean free trade area: 2010. EIB + EU budget: financial and technical assistance.

27. 3) Regional Cooperation with Asia and Latin America • Specific agreements between EU and regional groupings: ASEAN, ANDEAN PACT, CACM, MERCOSUR. Financing small scales projects for the least developed countries in these regions plus limited special market access provisions. From the Spring 2000: negotiation of free trade agreement with MERCOSUR but problems with EU-CAP

28. 4) Trade and Cooperation agreements with individual Asian, African and Latin American countries • Limited benefits beyond GSP (or GSP plus) access enjoyed by all developing countries • First FTAs in LA: Mexico: since 2001, Chile since 2003, Central America: 2010. • The rest in LA: most sub-regions: associational agreements including FTA to the exception of Mercosur. Andean region broken, bilat agreem: Colombia, Peru.

29. Neoliberalism as the new hegemonic discourse • NICs-Asia-the new paradigm for LDCs • 80s: debt crisis • 89: collapse of the Berlin wall • Structural adjustment (+ h.r. and democracy) as the new norm starts to enter into Lomés (Lomé IV-1990) • 1992: -goal of a common development policy gradual integration of LDC into the world economy

30. New Agreement: Cotonou: 2000-2020 • keeps framework from Lomé IV: comprehensive approach. Diversified instruments, integral concept of aid-trade , mechanisms for monitoring, evaluation, reviews. • more conditionalities: good governance, respect for human rights

31. Cotonou: Good governance as fundamental element: • “The transparent and accountable management of human, natural, economic and financial resources, for the purposes of equitable and sustainable development. It entails clear decision making procedures at the level of public authorities, transparent and accountable institutions, the primacy of law in the management and distribution of resources and capacity building for elaborating and implementing measures aiming in particular at preventing and combating corruption.”

32. ACP’s press release “found them to be imbalanced as a result of the overemphasis given to EU objectives, particularly political objectives, while those of the ACP- such as development-were often ignored. Some attempt was made to remedy this criticism but the text is still unbalanced with EU objectives not only repeated ad nauseam but often elaborated whilst those of the ACP, such as the arms trade and the EU’s role in this, do not merit a mention. (ACP Secretariat, 2000: 2)

33. Towards normalization • Extension of GSP favoring stronger countries among LDCs: Kuwait, China, India, Brazil • WTO’s demands: the problem of double identities interest within EU and within WTO partial solutions: waivers for Lomé until 2000 and extension2008 • LDCs also contradictory identities-stronger and weaker groups

34. The beginning of the end of EU as “a model” in development policies • To make development policy more consistent-normalization • Linking anti-poverty policies with trade integration • Previous trade preferences seen as a failure • New regional cooperation the right path • differentiated reciprocities, creation of REPAS /Regional Economic Partnerships, compatibilization with WTO

35. EU-seeking compatibility among multiple identities • Domestic concerns-CAP • EU Commission-championing the organization of WTO • EU members-also within WB, IMF-pushing for globalization and opening markets • Previous Lomé policies-risk free-low cost for EU but controversial in the WTO era • To combine “realpolitik” interests with development aims South Mediterranean and North Africa-potential migration problems, political instability new sorts of preferences

36. After Cotonou: what next? • Reflections from the part of ACP: • Lisbon treaty: not a single mention of ACP countries • A future with or without Europé? • Newpartnerships with emerging economies as China, Brazil and India? • Plans for a new common investment ACP bank

37. EU-trade-neoliberalism in search of consistency • Trade preferences as a development policy no longer consistent with new visions • Globalization-also-raises the need to reach new markets • Investments and the search for natural resources- apparently aid? • When EU is no longer the model, what pattern to follow?