The Alignment of Economic Partnership Agreements and Regional Economic Communities

The Project at A Glance

The European Union (EU), in the context of the Cotonou and Post-Cotonou Agreements, aimed to replace its unilateral preferential trading arrangements with African, Caribbean and Pacific countries with reciprocal although asymmetrical, trade agreements, known as Economic Partnership Agreements (EPAs).

International Economics Consulting Ltd. (IEC), with funding from the GIZ, conducted a study aimed at identifying the impacts of EPAs on Africa’s regional integration process, especially with regard to the Economic Community of West African States (ECOWAS). In particular, the study will assess the alignment of tariffs between ECOWAS and the EPAs signed by Ghana and Cote D’Ivoire and the alignment of Rules of Origin.

What We Found

Regional integration in Africa is characterised by numerous regional economic communities (RECs) that have been established with the aim of promoting regional and continental integration. Eight official RECs are officially recognised by the African Union and this includes ECOWAS. ECOWAS has a membership constituting 15 member countries. At the time of negotiating the EU-ECOWAS EPA, the ECOWAS Secretariat also adopted a Common External Tariff (CET) that applies to all third parties.
However, the EU-ECOWAS EPA did not come into effect, failing to obtain the signature of all Members of the REC. Therefore, Cote D’Ivoire and Ghana opted to sign their own EPAs in order to reap the benefits of preferential market access with the EU. However, this may be perceived as detrimental to the regional integration objectives of African countries and equally deviate from one of the key motives of EPAs in general, which is to foster regional integration. Hence, International Economics Consulting will assess the impacts of the EPAs on regional integration, focusing on tariff liberalisation and preferential Rules of Origins. Generally, it would follow that a more restrictive tariff (i.e. higher tariff for EU imports) than the CET would not hinder integration while a more liberal tariff might represent a challenge, as the other members of the Customs Union might not want to extend similar treatment to the EU.

Our Strategy and Impact

The main objective of this project is to assess whether, and how, EPAs are aligned with the customs unions of the RECs in sub-Saharan Africa, and provide recommendations and lessons learned for the implementation of the AfCFTA. Following consultation with the GIZ and other stakeholders, a literature review and stakeholder consultations will be conducted in parallel. Then we will conduct an analysis of the alignment of tariffs, and Rules of Origin in order to identify any divergences between the tariff regimes with the EU and the Customs Union. Finally, the study will include prioritised recommendations and actions for the EU and African trade policymakers in order to ensure that the EPAs effectively contribute to the countries’ regional economic integration efforts, both at the regional and continental levels.

Our Core Solutions

With the rapid proliferation of trade agreements worldwide, there are new market and investment opportunities for countries to explore. At International Economics Consulting, based on our extensive experience in international trade, we assist our clients by providing a detailed analysis of the key impacts of new trade agreements on their operations and competitiveness through an assessment of tariff, and non-tariff barriers, provisions on rules of origin, customs efficiency, the effectiveness of transport networks, and sustainability provisions, among others.
We can help assess the opportunities in different markets, determine the feasibility and viability of projects, and benchmark the wider ecosystem to support business growth. We also support clients in navigating the policy landscape regarding international trade by establishing robust monitoring and evaluation framework through sophisticated real-time dashboards and reporting systems to ensure the best outcomes.

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