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The Impact of Economic Partnership Agreements on ACP Agriculture Imports and Welfare

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  • Oliver Morrissey,
  • Evious Zgovu

Abstract

This paper estimates the impact on a sample of 36 ACP countries of eliminating tariffs on agricultural imports from the EU under EPAs, considering trade, welfare and revenue effects. Even assuming ‘immediate’ complete elimination of all tariffs on agriculture imports from the EU, and when excluding up to 20% of imports as sensitive products, over half of ACP countries are likely to experience welfare gains. However, although most LDCs gain (10 out of 13), most non-LDCs (about 60%) lose. 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. In general, excluding SPs reduced the welfare gain (or increased the welfare loss) compared to estimates where no products are excluded.

Suggested Citation

  • Oliver Morrissey, & Evious Zgovu, 2007. "The Impact of Economic Partnership Agreements on ACP Agriculture Imports and Welfare," Discussion Papers 07/09, University of Nottingham, CREDIT.
    • Handle: RePEc:not:notcre:07/09
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    File URL: https://www.nottingham.ac.uk/credit/documents/papers/07-09.pdf
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    Cited by:

    1. Chris Milner, & Oliver Morrissey, & Evious Zgovu, 2007. "Adjusting to Bilateral Trade Liberalisation under an EPA: Evidence for Mauritius," Discussion Papers 07/11, University of Nottingham, CREDIT.
    2. Oliver Morrissey, 2008. "Investment Provisions in Regional Integration Agreements for Developing Countries," Discussion Papers 08/06, University of Nottingham, CREDIT.
    3. Alisa Dicaprio & Silke Trommer, 2010. "Bilateral Graduation: The Impact of EPAs on LDC Trade Space," Journal of Development Studies, Taylor & Francis Journals, vol. 46(9), pages 1607-1627.
    4. Chris Milner & Oliver Morrissey & Evious Zgovu, 2008. "Trade Facilitation in Developing Countries," Discussion Papers 08/05, University of Nottingham, CREDIT.
    5. Chris Milner & Oliver Morrissey & Evious Zgovu, 2009. "EU-ACP Economic Partnership Agreements and ACP Integration," Discussion Papers 09/05, University of Nottingham, CREDIT.
    6. Chris Jones & Oliver Morrissey, 2008. "Are Imports in Africa Responsive to Tariff Reductions?," Discussion Papers 08/02, University of Nottingham, CREDIT.
    7. Rod Falvey & Annamaria La Chimia & Oliver Morrissey & Evious Zgovu, 2008. "Competition Policy and Public Procurement in Developing Countries," Discussion Papers 08/07, University of Nottingham, CREDIT.
    8. Chris Milner & Oliver Morrissey & Evious Zgovu, 2011. "Designing Economic Partnership Agreements To Promote Intra‐Regional Trade In Acp Countries," South African Journal of Economics, Economic Society of South Africa, vol. 79(4), pages 376-391, December.

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