What do the EPAs have to offer Haiti?

EPAs: What do they offer Haiti?
February 1, 2013 Christian Wisskirchen
epas-haiti

HSG from Room Altiero Spinelli 5G-3, European Parliament, Brussels, 31-01-2013

To a European Union (EU) Parliamentary Committee meeting of DCAR, the Delegation to what is known as CARIFORUM, all the CARICOM states which include Haiti, plus the Dominican Republic. The main item on the agenda is what is billed as an “exchange of views” on the impact of Haiti’s potential ratification of the Economic Partnership Agreement (EPA) which it signed with the EU in December 2009.

Co-ordination Europe-Haiti (CoEH), the European umbrella advocacy group of which HSG is a leading member, has brought Camille Chalmers, the director of PAPDA, the Haitian Advocacy Platform for Alternative Development, to Brussels to testify to the devastating impact that the EPA could have on the Haitian economy. In doing so, he articulates an alternative view of regional integration and EU co-operation that goes well beyond markets to the strengthening of Haiti’s productive capacity and the sovereignty of its public policy formulation.

The EPA is in essence a mutual trade liberalisation pact between the EU and the CARIFORUM states. As few economies anywhere in the world have suffered such devastating consequences from tariff reductions in the past 30 years as Haiti, particularly in its agricultural sector (see Haiti Briefing No. 72), Haitian CSOs, led by PAPDA, have called for a five-year moratorium on EPA ratification. This they argue would allow for real socio-economic studies and inclusive, public discussions and debate on the probable effects of the EPA in the context of past experience and current circumstances.

Camille Chalmers’ first point is that economic circumstances have changed beyond all recognition since EPAs were first conceived and finalized in 2007. The World Trade Organisation (WTO) negotiations on which they were premised have completely broken down and the ongoing financial crisis that broke in 2008 has totally transformed world economic contours. In Haiti, meanwhile, a series of hurricanes in 2008 and 2012, as well as the devastating earthquake of 2010, has lead to the loss of the equivalent of more than 120% of Haiti’s GDP, most of which is yet to be recovered.

While the Haitian economy is on its knees, with minimal exports to anywhere, let alone the distant markets of Europe, Haitian imports, particularly of foodstuffs, manufactures and capital goods, have exploded. With Haiti already enjoying duty-free, quota-free access to the EU market as the only CARIFORUM state classified as a Lesser Developed Country (LDC), the benefits of any EPA in Haiti are likely to be even more of a one-way street in the EU’s favour than they are elsewhere. The proposed EPA will increase market penetration for EU goods, erode or inhibit the growth of Haitian productive capacity, and throw yet more Haitians out of work.

All this would of course run directly counter to the declared aims of EU development policy in Haiti – a classic example of what the EU has set out to combat in its commitment to what it terms “policy coherence.” PAPDA argues that the provisions of the EPAs would spawn yet another surge of imports (both local and foreign produced goods) from the Dominican Republic and have estimated that adopting them would lead to a 5-6% loss of total Haitian tax income, further weakening a feeble state and its ability to deliver even the most basic public services. “We must not, cannot repeat the errors of the past,” Chalmers argues.

For the European Commission, Anthony Walford argues that the EPAs involve very asymmetrical obligations, with the EU opening its markets straight away, while CARIFORUM states have up to 25 years to do the same. He, like Nicolas Rinaldi, the only MEP to speak in the debate, portrays the adoption of an EPA as a major modernisation measure for Haiti’s mercantilist economy – overly dependent on tariff income.

However, there is no corresponding advocacy for effective, increased direct taxation to replace the lost income or even sovereignty resulting. We hear that EPAs will bring greater “transparency and stability” to Haitian trade, without any explanation of how. Finally, we hear regret that it is Haitian sovereignty that stands in the way of adoption of the EPA, which has been so delayed. Haiti, is, the European Commission claims, the only country in the region in which EPAs have to be approved by the legislature as well as the executive.

“We are open to discussing these issues but must have a sound basis for doing so, not just emotional conjecture,” Walford complains. It is as an economist that Camille Chalmers effects the most withering put down of the session when he retorts that he is speaking from a “sound basis” – studies by the University of the West Indies (UWI) on the impact of the EU’s EPA on Jamaica and, more potently and poignantly, Haiti’s experience of nearly thirty years of neo-liberal tariff cutting.

Like so much else in Haiti, to witness aid flows that go straight back whence they came via western companies and consultancies, a UN whose troops rape, introduce cholera, then deny it, privatisation that entrenches and enriches the elite by firing workers, budget cuts that slash minimal basic services, food aid that enriches subsidised western farmers while devastating their Haitian counterparts, free trade has worked fine for the international community who impose it. It is the complete reverse for the vast majority of Haitians, who asked for none of it, and have spent years resisting, as well as suffering, the consequences.

One look northwards at western economies pre- and post 2008, another southwards at the Latin American states that have followed a very different path, and its clear which economic model the poor majority of Haiti would rather be following. Forget Washington DC or Brussels’ prescription, try that of Caracas, Quito, La Paz, Brasilia, even Buenos Aires. In the immediate aftermath of the earthquake, Canada’s then Governor General, Michaelle Jean, herself of Haitian origin, toured the devastation with one message in three languages. “Haiti has got to stop being a dumping ground for failed economic experiments from elsewhere.” Haitians listened. Did anyone else?

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