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» 28.09.2009 - Namibia urges for harder line against coups d’état
» 24.07.2009 - Namibian court orders continued freezing of assets
» 29.08.2008 - World class uranium deposits discovered in Namibia
» 14.07.2008 - Namibia registers record inflation
» 02.06.2008 - Skills shortage plagues Namibia's mining industry
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Economy - Development | Politics

Namibia stands up to "EU bullying"

Hage Geingob, Namibian Trade Minister and Vice-President of the ruling SWAPO party

© Swapo/afrol News
afrol News / IPS, 26 May
- Tensions between the European Union (EU) and Africa have once again erupted, with Namibia accusing the Brussels elite of resorting to bullying tactics in trade negotiations.

In official statements, the European Commission - the EU's executive - has consistently argued that the Economic Partnership Agreements (EPAs) it has been hoping to conclude with 47 African countries will bring tangible benefits to the continent. African governments have proven far less enthusiastic about these trade liberalisation accords, with some arguing that they are fomenting divisions among neighbours.

In a strongly worded address to Namibia's national assembly on 19 May, the country's Trade Minister Hage Geingob warned that the EPAs will probably cause the Southern African Customs Union (SACU) to disintegrate. Marking its 100th anniversary this year, SACU is the oldest trading bloc of its kind in the world.

Whereas analysts say that an essential component of any customs union is that it applies common taxes or tariffs on goods traded with the rest of the world, maintaining that approach may no longer be feasible because SACU's five member states have entered into two different arrangements with the EU.

During 2009, Botswana, Lesotho and Swaziland all signed an EPA covering trade in goods with Europe. South Africa and Namibia, on the other hand, have refused to sign the same accord, viewing it as inimical to their interests.

Although Minister Geingob acknowledged that there are "serious strains" within SACU, he said that its governments have resolved to do what they can to work together. Earlier this year all five sought a meeting with Karel de Gucht, the EU's Trade Commissioner, in order to examine what safeguards could be offered to ensure that SACU can remain in place. But Mr Geingob expressed his "dismay" that the request was "roundly and condescendingly rejected" by Mr de Gucht.

Minister Geingob insisted it would be wrong to bow to European pressure and accept the EPA put forward by Brussels. That agreement, he suggested, would require Namibia to abandon strategies that it regards as essential for its economic development.

For example, the Namibians apply export taxes on some raw materials in order to encourage that they be processed within the country, thereby providing jobs; yet the EU is adamant that such taxes should be scrapped. By opening up its markets more to European exports, Namibia would also be unable to allow its domestic industrial and agricultural sectors to grow without the pressures of outside competition.

The net result, according to Mr Geingob, could be that Namibia would have to sacrifice jobs in agriculture and food processing and policies designed to ensure that its population has a ready supply of food.

"We may have to wave goodbye to our pasta and dairy industries," the Namibian Minister said. "We would furthermore have to abandon all forms of quantitative restrictions on imports and exports if we sign. This would risk all our past achievements in horticulture and cereal production, as you know we have depended too much on the import of food in the past. Our advances towards food security and rural development were made by creating secure markets for our producers, by restricting imports of fruit, vegetables and cereals."

Mr Geingob concluded his speech by calling on "our friends in Europe" to work towards resolving the surrounding problems. "Let us not use bully tactics or old colonial arrogance," he added.

The European Commission would not accept Mr Geingob's criticisms. John Clancy, its trade spokesman, said that the institution attaches "a great deal of importance to working with all African partner nations to ensure Economic Partnership Agreements are drivers of economic and social development for the continent and all its peoples."

"Each country must, of course, decide for itself the path it considers best to follow but we strongly believe that Namibia will benefit from being an EPA partner," Mr Clancy told 'IPS'.

Nonetheless, Minister Geingob's remarks echo those made by other political figures in Africa.

Last month, South African President Jacob Zuma argued that Europe's attitudes in the EPA talks had meant that the future of SACU was "undoubtedly in question". President Zuma drew attention to how SACU's core rulebook contains - thanks to a 2002 amendment - an obligation that trade agreements are negotiated collectively on behalf of all its members. Labelling that provision as a "cardinal principle of our existence", Mr Zuma urged SACU to examine "how to eliminate all vestiges of colonial systems of domination and dependency."

Just 10 of the 47 targeted African countries have signed an EPA so far. A recent study by the South Centre, a research institute in Geneva representing developing countries, observed that most governments are either dragging out the negotiations or are reluctant to enter into trade deals because they regard some of the EU's central demands as "toxic". Of particular concern is the Union's efforts to eliminate 80 percent of the tariffs that Africa levies on imports.

According to the South Centre, Africa is correct to be wary of removing these taxes, given its recent history.

In the 1980s, many African countries introduced rapid reductions in their tariffs, as part of the "structural adjustment" programmes foisted on them by the World Bank and the International Monetary Fund. Among the consequences of these cuts were that one-third of manufacturing jobs were wiped out in Senegal. The Senegalese situation was one of numerous cases in Africa, where cheap imports severely damaged local industries, causing large-scale unemployment across the continent.

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