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The Impact of Economic Partnership Agreements in Countries of the Southern African Development Community

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  • Alexander Keck
  • Roberta Piermartini

Abstract

In the context of economic partnership agreements (EPAs) currently under negotiation between the European Union (EU) and African, Caribbean and Pacific (ACP) countries, trade is meant to be progressively liberalised in a reciprocal way as of 2008. EPAs are also intended to foster existing regional integration efforts among the ACP. This paper presents a computable general equilibrium model simulation of the impact of EPAs for countries of the Southern African Development Community (SADC). Different liberalisation scenarios are compared. We find that EPAs with the EU are welfare-enhancing for SADC overall, in particular if reductions in unemployment are considered. Results are robust to variations in key model parameters. For most countries, further gains arise from intra-SADC liberalisation. The possibility of the EU entering an free trade agreement with other countries, such as Mercosur, reduces estimated gains, but they still remain largely positive. Similarly, estimated gains need to be revised downwards if agriculture liberalisation is not as far reaching as a reduction of import barriers for manufactures. At the sectoral level, the largest expansion in SADC economies takes place in the animal agriculture and processed food sectors, while manufacturing becomes comparatively less attractive following EU--SADC liberalisation. Results also show the need for the Southern African Customs Union tariff pooling formula to be adjusted to reflect new import patterns as tariffs are removed. Copyright 2008 The author 2007. Published by Oxford University Press on behalf of the Centre for the Study of African Economies. All rights reserved. For permissions, please email: journals.permissions@oxfordjournals.org, Oxford University Press.

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Bibliographic Info

Article provided by Centre for the Study of African Economies (CSAE) in its journal Journal of African Economies.

Volume (Year): 17 (2008)
Issue (Month): 1 (January)
Pages: 85-130

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Handle: RePEc:oup:jafrec:v:17:y:2008:i:1:p:85-130

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Cited by:
  1. Sukati, Mphumuzi, 2011. "The SADC region and EPA/EBAI – trade balance analysis," MPRA Paper 31992, University Library of Munich, Germany.
  2. Thierry Verdier, 2010. "Regional Integration, Fragility and Institution Building: An Analytical Framework Applied to the African Context," EUI-RSCAS Working Papers 38, European University Institute (EUI), Robert Schuman Centre of Advanced Studies (RSCAS).
  3. Lionel Fontagné & David Laborde & Cristina Mitaritonna, 2009. "An Impact Study of the Economic Partnership Agreements (EPAs) in the Six ACP Regions," PSE - G-MOND WORKING PAPERS halshs-00967434, HAL.
  4. Douillet, Mathilde, 2011. "Which trade integration scheme can best help Sub-Saharan Africa develop and export more processed agricultural goods?:," IFPRI discussion papers 1119, International Food Policy Research Institute (IFPRI).
  5. Lionel Fontagné & David Laborde & Cristina Mitaritonna, 2009. "An Impact Study of the Economic Partnership Agreements (EPAs) in the Six ACP Regions," Working Papers halshs-00967434, HAL.

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