1. Groupe d'Economie Mondiale http://gem.sciences-po.fr Trade, Development and the EPAs Patrick A. Messerlin Professor of Economics, Sciences Po Director, Groupe d’Economie Mondiale à Sciences Po (GEM) The EU, Trade and Development Policy Open Europe London, 26 March 2007

2. Groupe d'Economie Mondiale http://gem.sciences-po.fr Trade for development (1)  Trade, growth, development, happiness  Trade as an incentive for better investment in a country Contracts import-competing industries Expands export industries  Trade liberalization: a necessary condition for benefiting from the opening of foreign markets The cotton case in Africa The “Round for free” (China vs. the EC)

3. Groupe d'Economie Mondiale http://gem.sciences-po.fr Trade for development (2)  Policy space and trade policy not endangered by market opening tariff=tax on consumers and subsidy for producers need for targeting  “Behind-the-border” agenda Huge policy space: taxes and subsidies on production and consumption of goods, services and factors of production WTO disciplines generally friendly to domestic instruments My Kingdom for a Budget! Tariffs vs. trading costs

4. Groupe d'Economie Mondiale http://gem.sciences-po.fr Trade for development (3)  Ideal trade policy Uniform and moderate tariff Tariff cuts under a Swiss formula Common virtues  Economics: cutting the highest tariffs  Politics: neutralizing the lobbies  Policy Space: providing fiscal revenues

5. Groupe d'Economie Mondiale http://gem.sciences-po.fr A Global Look at the EPAs (1)  The current EPAs Economics: cutting the lowest tariffs Politics: exacerbating the lobbies Policy space: reducing fiscal revenues  The EPAs and selected Bilateral Trade Agreements Size Trade in goods Trade in services

6. Groupe d'Economie Mondiale http://gem.sciences-po.fr A Global Look at the EPAs (2)

7. Groupe d'Economie Mondiale http://gem.sciences-po.fr A Global Look at the EPAs (3)

8. Groupe d'Economie Mondiale http://gem.sciences-po.fr Better Alternatives?  No Doha Deal EBA-Plus GSP-Plus  A Doha Deal The Hong-Kong “97%-Plus” Initiative A WTO new “waiver”?  Limited reciprocity  MFN tariff cuts  uniform MFN tariffs

9. Groupe d'Economie Mondiale http://gem.sciences-po.fr Thank You !

10. Groupe d'Economie Mondiale http://gem.sciences-po.fr The Rise of Bilateralism?

11. Groupe d'Economie Mondiale http://gem.sciences-po.fr A Global Look at the EPAs (3)

12. Groupe d'Economie Mondiale http://gem.sciences-po.fr The Issue of Farm Tariffs