Payback time

Development Policy,Inclusive Economy23 Jun 2011Mirjam van Reisen

‘If the ACP didn’t exist, it would have to be invented,’ remarked Mohamed Ibn Chambas, secretary-general of the African, Caribbean and Pacific Group of States, at a recent event in Brussels celebrating 36 years of the Treaty of Georgetown. ‘We must take the future in our own hands by embracing South-South cooperation and using the opportunities from China and other emerging nations.’ Chambas reiterated the ACP’s need to strengthen itself as a group if it is to gain more influence in global institutions. A first step could be to invite more nations to join, including Least Developed Countries (LDCs) such as Nepal, so that it includes all the poorest countries.

Meanwhile, it is important that the group of 79 ACP countries does not become internally divided or even split. In fact, the European Union (EU), a partner of the ACP in development cooperation, has tried to cause rifts in the ACP on several occasions by playing to individual countries’ interests. When the United Kingdom (UK) joined the European Economic Community in 1973, the group of former colonies was expected to fall apart. But instead they responded by signing the Georgetown Agreement establishing the ACP Group in 1975. The EU again attempted to instigate a split in 2000 during the Economic Partnership Agreement (EPA) negotiations.

Of course, the ACP represents many different interests and is by no means a homogeneous bloc. But this only adds depth to its potential as a voice for countries excluded from or on the margins of decision-making processes.

Unique selling points

Each ACP country needs to discover its own unique selling point, says Patricia Francis, executive director of the International Trade Centre (ITC). ‘Most people in apartments in Brussels would love to lie down under a coconut tree in Tonga. So how come most people in Tonga want to live in an apartment in Brussels?’ Francis, a Jamaican, smiles when talking about her country’s Rastafarian colours, red, green and gold. ‘Rasta used to stand for second or third class people. Others showed us its value, like Dior selling Rasta socks for $60. Do you think Jamaica received even one dollar for this? Discover your value while you can!’ The lesson here is that ACP countries need to identify and value their own unique attributes before it’s too late.

Francis is convinced that there is a great deal of potential for producers to make more money by developing more valuable products. The ITC is just one of many organizations that have helped coffee producers in Ethiopia, cotton producers in Africa, and others, to make higher-quality products that can be sold at higher prices.

Stephen Katenta-Apuli, Uganda’s ambassador in Brussels, is optimistic that exports to the EU can be further increased. ‘Uganda,’ he says, ‘has seen its export volume to the EU go up from 38% to 42% in five years – mostly tea, coffee and cotton, but also more and more cut flowers and fish. There is still room for improvement. The country is still focused on [building] more roads and railways to benefit traders, as well as on generating more energy for its producers.’

But on the whole, the African ACP countries’ share in world trade almost halved from 3.8% in 1980 to 2.0% in 2009. Caribbean countries fared even worse. Their share dropped from 1.1% to 0.3% in the same period. The Pacific countries went down from 0.1% to 0.0%.1 According to Francis, most ACP countries do not benefit from European Union trade preferences, with the exception of 11 mainly sugar-producing countries. ‘The preferences were shackles instead of help,’ she concludes. Most ACP states export only to fellow ACP states.

In a presentation to the United Nations (UN) conference on the LDCs in Istanbul in May 2011, European trade commissioner Karel De Gucht admitted that African exports to Europe have not increased. ‘Its share in world trade and investment is still too low: just around 3%, and not progressing. The bulk of its trade is still in the commodity sectors: fuels, minerals, agricultural products.’2

De Gucht uses export as an example. ‘Above 70% of Africa’s exports to Europe in 2010 was still in [the commodity sector]. The increased trade with the emerging countries has not substantially changed these traditional patterns, born in the colonial times and consolidated during decades of unilateral trade preferences from developed countries … However, particularly in African Least Developed Countries, there is the urgent need to move further up the manufacturing chain and develop a competitive services sector in order to become an active part of the world trade networks and supply chains, and not to get definitively stuck in a resource curse.’3

Prioritizing intra-ACP trade

Benin’s ambassador in Brussels, Charles B. Todjinou, agrees: ‘The last 36 years haven’t shown much change. We thought we would move away from marginalization by linking up with the EU. We need to open markets in the South. For a win-win partnership we in the South also need each other. It is time to move from dependency to a win-win situation, with more South-South cooperation.’

More ACP countries also need to establish trade agreements with each other. Uganda, for example, has benefited from a free-trade agreement with its neighbours Kenya and Tanzania. According to Ambassador Katenta-Apuli, ‘Within five to seven years it even wants a federation with these countries, together with Burundi and Rwanda.’

But this kind of cooperation among ACP countries is not necessarily the norm yet. Cameroon and Nigeria, for example, are evidence that exporting to neighbouring countries does not always come naturally. ‘The two countries don’t have strong relations, at government or other levels. Nigeria has big cement businesses, but Cameroon has to import cement from other states,’ mentions a civil servant, who wishes to remain anonymous, emphasizing that the countries need to strengthen their political relations in the interest of greater economic cooperation.

There is consensus among diplomats that political cooperation to facilitate trade is an area where the ACP can play an important role. The ACP would be stronger as a bloc if it promoted its members’ common interests in the World Trade Organization (WTO), for example. A stronger bloc could influence commodity prices and food prices, secure the protection of important markets and demand measures against European and US subsidies. It could also support sub-groups of ACP countries when their common interests are threatened.

Of course, the ACP is already doing this, for instance with cotton. It is protecting the interests of four of its members against the cotton subsidies of the United States and the EU to its farmers. This case has been brought to the WTO and is a litmus test of the WTO’s ability to protect the interests of its smaller members.

Green lungs

Some believe that the ACP can play a role in addressing climate change as well. Most of the countries that will be adversely affected by climate change are ACP countries. ‘The ACP should be at the forefront of raising these topics in international forums,’ says Lord Meghnad Desai, emeritus professor at the London School of Economics and Political Science. Referring to island states, such as Tonga, which is threatened by rising sea levels, , Desai warns that ‘we cannot live in denial: a lot of people have to be moved. It is a question of survival for many people. The ACP should put this on its agenda.’

Other African diplomats agree that the ACP bloc can make a very relevant contribution to climate negotiations. Uganda’s Stephen Katenta-Apuli points out that ‘ACP countries happen to be mainly in the tropics. That is a good place for planting more trees, which will consume CO2. Why aren’t we working together on this?’ These interests go across continents and across regional groupings.

The need to protect rainforests provides another argument for strengthening the ACP Group. Commentators have long warned that tropical forests would come under pressure if Economic Partnership Agreements were signed between the EU and the ACP. For example, Thomas Lazzeri of the Africa Europe Faith and Justice Network, warns that Africa’s forests, particularly in the Congo basin and in West Africa, would ‘come under threat if EPAs were implemented and export restrictions removed, as this would open [them] up to unrestricted logging … These ecosystems are not only vital for the local population, but are relevant globally as they are some of the world’s most significant green lungs and important for climate regulation.’4

Not the only group on the bloc

The ACP as a group should set priorities and consolidate its expertise to make use of the diversity of its members, which include LDCs as well larger economies such as South Africa and Nigeria. Countries like Ethiopia also have some leverage in international relations, as was shown in the 2010 climate negotiations in Copenhagen, when US President Barack Obama consulted with Brazil, China, India, South Africa and Ethiopia before talking to the EU.

‘To ensure the success of such joint initiatives’, says Simon Stocker of Eurostep, a network of European NGOs, ‘it is important that some relatively large nations act as brokers.’ He adds that ‘climate change is another example of an issue with a common agenda for the ACP. It might also consider lobbying so that LDCs are not too narrowly defined. And it could up the ante and submit a joint request for more concessions from the rich countries.’

Neglecting the interests of Africa – a continent forecast to have a population of two billion by the 2050s, half a billion more than India or China – in global negotiations could have serious consequences, warns Henning Melber, executive director of the Dag Hammarskjöld Foundation, an independent forum for debate. ‘African countries are virtually unrepresented in many processes,’ he says. ‘The continent is excluded. But payback time is coming as international interest in and dependency upon Africa’s natural resources is growing. Geostrategic considerations, such as securing shipping routes around the Horn of Africa, are also important.’5

Indeed, the ACP countries are increasingly aware that they need to organize themselves as an independent bloc. They recently demonstrated their ability to act as a group by delaying a decision on whether the EU should have the right to speak as a group in the UN General Assembly. The EU assumed that it had such a right, following the adoption of the Lisbon Treaty. But the UN said that the General Assembly would have to decide on the matter.

Much to the irritation of the EU, the ACP countries did not support the proposal at first. Their rationale was that all regional blocs, and not just the EU, should have the advantage of representation. The ACP countries stood their ground and presented a new proposal that gave the same right to all regional blocs, including the African Union. The General Assembly unanimously adopted their proposal in May 2011.

Political cooperation is increasingly relevant and has brought clear benefits to the EU. In the latest revision of the Cotonou Agreement, agreements were included that support the International Criminal Court in The Hague and cooperation in fights against the proliferation of weapons of mass destruction and terrorism.

Clearly, the ACP does not owe its existence only to trade and cooperation agreements with the EU. The group also exists in its own right. It was established in 1975 when the Georgetown Agreement was signed. This agreement gives the ACP group a mandate to build relations with other international actors or groups of countries.

In 1997, the ACP Group met independently of the EU for the first time, underscoring its relevance not just in relation to the EU, but in its own right. Also at this meeting, in Libreville, Gabon, delegates adopted guidelines to strengthen the group and extend consultations in other forums, including the UN.

During a second summit, in the Dominican Republic in 1999, the ACP decided to enter into dialogue with other blocs, which led to the presence of the ACP at the ministerial conferences of the WTO in Doha, Qatar, in 2001 and Cancún, Mexico, in 2003. Later, at a third summit in Fiji in 2002, ACP heads of state and government agreed on a set of guidelines for the EPA negotiations with the EU.

Go South-South

Is South-South cooperation a way to strengthen the ACP? Well, yes. Developing countries can help each other by sharing their specific expertise and experiences. It does not always take experts from rich countries in the northern hemisphere to boost development.

If the ACP were to initiate projects for South-South cooperation, it could identify opportunities for countries to help each other. Such mutual assistance could also be extended to include investment, for example, through an ACP investment facility that is governed by the group.

To become a stronger bloc, the ACP must emphasize its unique selling points and take advantage of them. The group offers unparalleled opportunities for political cooperation. The ACP still has vast potential to expand trade as well, both South-South and with Europe.

Were the ACP to safeguard unity within the group and promote common interests, make use of the diversity of its members and the strengths of the group’s larger states, it could realize its potential power in the international arena and shrug off its dependence on Europe, gain influence in international institutions and defend its interests even more effectively.

South-South cooperationAn innovative project between Costa Rica, Benin and Bhutan provides an example of South-South cooperation that Benin is keen to introduce in the ACP. Farmers from three continents were encouraged to exchange information – Costa Rica taught Benin how to grow organic pineapples, for example, while Bhutan showed Costa Rica how to grow red rice.

By 2011, the initiative had led to 36 projects, around 5000 new jobs and hundreds of new companies and products, and it received the UNDP’s South-South Cooperation Excellence Award in 2010. The project was extremely cost-effective and created new economic ventures that were viable through the sharing of knowledge relevant to farmers in remote rural areas.


Lazzeri, T. (2011) EPAs and the European Raw Materials Initiative. Africa Europe Faith and Justice Network (AEFJN).