Title: Economic and Welfare Impacts of the EU-Africa Economic Partnership Agreements
Abstract: Th is study examines the economic and social impacts of the trade liberalization aspects of the proposed
Economic Partnership Agreements (EPAs) between the European Union (EU) and African countries.
It provides a quantitative assessment of the likely implications of EPAs establishing Free Trade Areas
(FTAs) between the EU and the various African Regional Economic Communities (RECs). Th e focus of
the empirical analysis is on the trade liberalization component of the EPAs. In particular, the following
questions are addressed. First, how will an EPA that includes reciprocal market access agreements between
the EU and Africa impact on African countries’ GDPs, levels of employment and other macroeconomic
aggregates? Second, what sectors in Africa are most likely to lose and what sectors gain with EPAs? Th ird,
what are the welfare implications for African countries from the EPAs? Fourth, how will the formation
of EPAs aff ect trade expansion through trade creation and trade diversion eff ects? Fifth, what are the
potential fi scal implications of the EPAs?
Th e main conclusions drawn from the results and the discussions are that full reciprocity will be very
costly for Africa irrespective of how the issue is looked at. A focus on deepening integration with a view to
enhancing intra-African trade would provide positive results. But it is the scenario that off ers unrestricted
market access for Africa, which deals eff ectively with barriers associated with sensitive European products,
that portends the largest gain for the continent. Even with reciprocity, a free trade area that includes
sectors of export interest to Africa and one that deals with non-tariff barriers promises positive results for
African countries.
Publication Year: 2005
Publication Date: 2005-05-02
Language: en
Type: preprint
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Cited By Count: 67
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