European Union and Africa dead locked on trade deal

Relations between Africa and the European Union have hit a wall after unsuccessfully overcoming trade negotiations disputes after comments by EU trade chief.

Stalled trade negotiations between the European Union and African states have soured relations between the two continents, the European Union’s chief trade negotiator said on Wednesday.

Regional groupings of African, Caribbean and Pacific states have resisted signing trade agreements with the EU despite years of negotiations, frustrated by EU demands to cut tariffs and by the wealth of EU commercial regulation.

That has allowed China, India and Brazil to move in and secure access to bountiful African resources and markets.

“It is true that this can be souring the relations between Europe and Africa,” European Trade Commissioner Karel De Gucht told Reuters in an interview.

To break the deadlock Europe may scale back calls for free trade in banking and other services sectors, and drop demands that African, Caribbean and Pacific states quickly adopt European rules on competition and the environment.

“On services we can be flexible. I think also on rules we can have a progressive approach,” he said, adding that any deal would have to create greater volumes of trade to abide by global trade rules.

FIRST DEAL?

Europe may yet clinch a first Africa trade deal in the coming months, De Gucht said, an agreement with the Southern African grouping of Angola, Botswana, Lesotho, Namibia, Mozambique, Swaziland and South Africa.

Another hindrance to better EU-Africa relations is Europe’s insistence on African guarantees of good governance and human rights, he said. China, which makes no such demands, has made rapid in-roads in signing trade deals with African states.

“The Chinese come with a check-book and they buy what they need and we do all this in institutional frameworks and institution-building,” De Gucht said. “I think it’s the right way to do it but it doesn’t make our life easier.”

Yet Europe should not back down on its governance demands, De Gucht said.

“We have to continue insisting on governance in Africa, because without governance you will not have growth,” he said.

Europe seems in a no-win situation. On one hand, it doesn’t want to be left behind by China, India, Brazil, the U.S. since the last person doesn’t always get the best choice or position. Secondly, it doesn’t want to go wobbly on its values of governance.  Its a catch 22 situation that the European Union is in.  All that can be said is the last person to the event doesn’t usually get the best offerings.  Europe might want to think carefully about that, given its luck luster economic growth and questionable leadership abilities in international relations.

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