The Impact of Economic Partnership Agreements on African, Caribbean and Pacific Countries Imports and Welfare
AbstractThis paper estimates the impact on a sample of 34 African, Caribbean and Pacific (ACP) countries of eliminating tariffs on imports from the EU under Economic Partnership Agreements (EPAs), considering trade, welfare and revenue effects. Even assuming ‘immediate’ complete elimination of all tariffs on imports from the EU, some two-thirds of ACP countries are likely to experience welfare gains; the ACP overall and the average ACP country gain. The overall welfare effect relative to GDP tends to be very small, whether positive or negative. While potential tariff revenue losses are non-negligible, given that countries have at least ten years in which to implement the tariff reductions, there is scope for tax substitution. An important issue is identifying the sensitive products (SPs) to be excluded from tariff reduction. We exclude products where ACP imports compete with the EU (as SPs have to be agreed at the regional ACP level). In general, excluding SPs on these criteria reduced the welfare gain (or increased the welfare loss) compared to estimates where no products are excluded. It remains the case that the ACP overall and on average gains, although only 13 countries (38%) experience a net gain in this scenario (but for another nine the net effect is zero or almost zero). This is to be expected as if ACP products are excluded as SPs the potential trade creation gains are reduced. However, as the exclusion criterion was products that are traded between ACP countries, these import losses would be offset by gains to ACP exporting countries. Perhaps the most surprising result is that even where EPAs imply a welfare loss (on imports), the losses are likely to be very small.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by European Association of Agricultural Economists in its series 2008 International Congress, August 26-29, 2008, Ghent, Belgium with number 44205.
Date of creation: 2008
Date of revision:
EU-ACP; Economic Partnership Agreement; ACP Imports; International Relations/Trade;
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-11-25 (All new papers)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Rolf J. Langhammer, 1992. "The Developing Countries and Regionalism," Journal of Common Market Studies, Wiley Blackwell, vol. 30(2), pages 211-232, 06.
- Garth Frazer & Johannes Van Biesebroeck, 2007.
"Trade Growth under the African Growth and Opportunity Act,"
NBER Working Papers
13222, National Bureau of Economic Research, Inc.
- Garth Frazer & Johannes Van Biesebroeck, 2010. "Trade Growth under the African Growth and Opportunity Act," The Review of Economics and Statistics, MIT Press, vol. 92(1), pages 128-144, February.
- Garth Frazer & Johannes Van Biesebroeck, 2007. "Trade Growth under the African Growth and Opportunity Act," Working Papers tecipa-289, University of Toronto, Department of Economics.
- Frazer, Garth & Van Biesebroeck, Johannes, 2007. "Trade growth under the African growth and opportunity act," Open Access publications from Katholieke Universiteit Leuven urn:hdl:123456789/253806, Katholieke Universiteit Leuven.
- Frazer, Garth & Van Biesebroeck, Johannes, 2007. "Trade growth under the African growth and opportunity act," Open Access publications from Katholieke Universiteit Leuven urn:hdl:123456789/253794, Katholieke Universiteit Leuven.
- Ozden, Caglar & Reinhardt, Eric, 2005.
"The perversity of preferences: GSP and developing country trade policies, 1976-2000,"
Journal of Development Economics,
Elsevier, vol. 78(1), pages 1-21, October.
- Ozden, Caglar & Reinhardt, Eric, 2003. "The perversity of preferences : GSP and developing country trade policies, 1976 - 2000," Policy Research Working Paper Series 2955, The World Bank.
- Oliver Morrissey, 2005. "Imports and Implementation: Neglected Aspects of Trade in the Report of the Commission for Africa," The Journal of Development Studies, Taylor and Francis Journals, vol. 41(6), pages 1133-1153.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search).
If references are entirely missing, you can add them using this form.