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A shift in regional focus from post WWII globalization

The interwar periods saw immense amount of protectionism as countries folded back into themselves and sought self-suffiency after a very open and trade focused world of the 1800s. After WWII the US focused on opening up Europes borders once again, with the help of the Marshal Plan and the Bretton Woods Institutions. Now that Europe and the US are for a large part open (at least with each other) the focus has turned to the rest of the world, Africa included.

“Officials from Southern Africa and the European Commission (EC) are expected to make progress in the fraught trade negotiations for an economic partnership agreement (EPA) when they meet in Brussels at the end of July. Two major sticking points – the alignment of tariffs and rules of origin in the EPA with an existing EU-South Africa trade agreement – will be addressed at the meeting. The EPA will ensure continued duty- and quota-free access to the EU for former European colonies in Africa, the Caribbean and Pacific (ACP countries), following the expiry of the Cotonou agreement in 2007. Due to the size of its economy, South Africa will have improved, but not duty- and quota-free market access. South Africa is particularly interested in increased access for certain agricultural goods, where high tariffs and strict sanitary and phytosanitary rules hamper trade. European agricultural exporters have easier access to South Africa than vice versa, according to University of Pretoria trade economist Mmatlou Kalaba. The EU has granted a five-year extension for agreement on next-generation issues, including services and investment, which will allow states time to trengthen their regulatory frameworks before opening up their markets.” Additionally, “Executive Director of the Trade Law Centre for South Africa said there is ‘enormous tension’ between the interests of the smaller countries in SACU (Southern Africa Customs Union) who had signed the EPAs and the commitment to the customs union.”

Implications from South Africa Node:

"This is a set of interrelated, complex issues that holds the potential to destabilise the region at worst, or put a brake on regional economic development and competitiveness at best. It may even lead to the disintegration of the customs union. Something will have to give as the impasse threatens lucrative trade with the EU on the one hand, whilst preventing the implementation of industrial development policy on the other hand, not to mention the unsustainability of South Africa continuing to fund large parts of its neighbours’ fiscus whilst battling poverty and unemployment on the home front. At the heart of the matter is the enduring dependency of the BLNS [Botswana, Lesotho, Namibia, Swaziland] economies on South Africa, and the unfairness of the global trade system that prevents competitive agricultural products from Africa entering developed markets."

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Sources:

South Africa Node July 2010, pg. 3
http://newsletters.clearsignals.org/SA-Node_July2010.pdf#page=3