THIRD WORLD: ACP States May Lose Out When EU Revamps Aid Policy

• by IPS Correspondents (brussels)
• Sunday, November 13, 1994
• Inter Press Service

BRUSSELS, Nov 13 (IPS) - A top European Union (EU) development official is predicting a very different look for European development policy at the turn of the century, with the changes expected to hurt African, Caribbean and Pacific (ACP) states.

"Looking into the crystal ball in seven or eight years time I do not see the LOME Convention (for 70 ACP states) continuing in its present form," says Peter Pooley, acting deputy director for the EU's development policy for ACP states. "I envisage a less exclusive LOME framework," Pooley said.

He indicated that the "best parts" of LOME could be extended to other developing nations.

The current LOME IV Convention (1990-2000) pact for ACP nations which are all ex-EU colonies, is the flagship of EU development policy.

It contains special trade preferences which are not on offer to other developing nations like for example in the field of cane sugar which is priced at two to three times the world rate; also it allows for duty-free access for bananas and beef into the EU markets from the ACP countries.

EU officials who monitor the Convention on a day-to-day basis say it does not have much shelf life given international developments like the democratisation process in South Africa, the erosion of several trade preferences by world trade liberalisation and growing reluctance of EU members to fund overseas development.

One EU official remarked that ACP countries had been privileged for historical reasons as ex-colonies, but there were now massive imbalances in EU development policy, for example, the huge benefits of Mauritius, a middle-income country, from LOME's trade clauses especially sugar protocol set against the EU's lesser support for low-income Bangladesh.

LOME's trade preferences are being progressively eroded by the Uruguay Round and are under legal attack from other contracting parties in the General Agreement on Tariffs and Trade (GATT). The European Union is to ask for a waiver from GATT's Ministerial Council to protect these 30-year preferences.

"The general opinion is that LOME is not very legal. LOME is not a good example of GATT legality," admitted one EU official. But he hoped that a waiver would be secured given solid support from GATT's 49 ACP states and the 12 EU nations.

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