Bridges Weekly Trade News Digest • Volume 6 • Number 26 • 10th July 2002
Africa Establishes Union, Solidifies NEPAD
From 28 June - 10 July, African leaders gathered in Durban, South Africa, to launch the African Union (AU), replacing the 39-year old Organization of African Unity (OAU) and bringing together 53 African countries. Meanwhile, the New Partnership for Africa’s Development (NEPAD) received prominence at the 26-28 June Group of Eight (G-8) summit meeting in Kananaskis, Canada. Whereas the AU is an economic and political partnership loosely modelled on the European Union, NEPAD is motivated by the desire to improve the economic well-being of the African continent, through among other things, better fiscal discipline and "good governance." NEPAD is the brainchild of South Africa’s Thabo Mbeki, Nigeria’s Olusegun Obasanjo, Algeria’s Abdelaziz Bouteflika, and Egypt’s Hosni Mubarak.
NEPAD at the G-8 Summit
In response to the NEPAD initiative, presented to the G-8 during its Genoa summit in 2001, the June 2002 G-8 released the details of its Africa Plan of Action in Kananaskis. Inter alia, the Action Plan proposes to "help Africa attract investment, both from within Africa and from abroad and implement policies conducive to economic growth." In the document, the G-8 endorsed a "firm commitment to assisting Africa" in its current efforts aimed at attracting domestic and foreign investment, including taking actions to provide greater market access for African products, increasing funding, improving the quality of support for trade-related technical assistance and capacity-building and promoting regional integration and intra-African trade.
The Action Plan also seeks to help African countries work towards enhanced market access on a WTO-compatible basis, increase trade with African free trade areas or customs unions, support the efforts of African countries to eliminate tariff and non-tariff barriers within Africa in a WTO-consistent manner, and support efforts by African countries to work towards lowering trade barriers on imports from the rest of the world. The G-8 leaders also agreed to increase aid to African countries by a total of USD 12 billion per year by 2006. As outlined in NEPAD, performance of African countries will be judged by a peer-review system that will decide whether a government is meeting its commitments. Nations that don’t meet this peer review process will lose some of their share of aid.
NEPAD and the African Union
The relationship between NEPAD and the African Union (AU) remains what some observers have termed "fuzzy", with NEPAD establishing its own secretariat and operating very much as an organisation in its own right despite the AU’s adoption last year of NEPAD as a program. Paragraph 198 of the NEPAD Policy Document states that "the heads of state promoting the NEPAD will advise the AU on an appropriate mechanism for its implementation", indicating that NEPAD should be implemented within the aegis of the AU. There have also been concerns about regional representation within NEPAD, with the east African region as the most vocal critic along these lines. and is modelled after the European Union. South African President Mbeki, who was instrumental in formulating and marketing the idea of NEPAD, has been nominated the first chairman of the AU.
In a presentation at the WTO’s 1 July Committee on Trade and Development (CTD), NEPAD Secretariat chair Wiseman Nkuhlu updated WTO Members on the objectives of NEPAD, stating inter alia that NEPAD’s market access objectives were consistent with the WTO’s Doha mandate.
"Leaders Gather To Bury OAU, Launch New Union," UNWIRE, 9 July 2002; "Huge Challenge for African Union," BBC, 8 July 2002; "Statement Issued By Four African Leaders of The NEPAD Steering Committee At The End of Their Meeting With The G8 During The Summit Held In Kananaskis, Canada, 27 June 2002; "G-8 aid plan sidelines NEPAD," IPS, 27 June 2002.