The Impact Studies on the Effects of REPAs between the ACP and the EU

In November 1998, the European Commission released five studies on the impact on ACP countries of its proposed Regional Economic Partnership Agreements. A sixth one on Francophone West Africa was made available in February 1999. This paper presents the main results of these studies. The studies do not make a clear case for or against REPAs, because:

• the results of the quantitative assessments depend on the many assumptions that were made, many of which were necessarily a simplification of reality (e.g. in assessing the degree of substitution between local goods and imports from Europe, or between imports from Europe and from somewhere else); 
• the studies were mainly desk-based, often relying on data that was not readily available or of poor quality, therefore making any quantitative assessment at best a rough estimation of trends; 
• the six studies were not easy to compare as they used different methodologies and sometimes different assumptions.

Despite these limitations, some general conclusions can be drawn:

• in most cases, LDCs have little to gain from REPAs. They can keep non-reciprocal trade preferences anyway;
• the replacement of non-reciprocal tariff preferences with the GSP would adversely affect some products exported by some non-LDC ACP countries, but most ACP exports would be barely affected;
• by contrast, the direct or indirect effects of not renewing the commodity protocols could dramatically affect the exports of some ACP countries. However, none of the studies estimated these effects as this would have required separate studies;
• the negative impact on customs revenues varies considerably, but could be substantial for some countries, which may thus claim for adequate financial support;
• lower import taxes would benefit customers as well as importers of capital goods, but it is difficult to say to what extent these welfare gains would offset the losses mentioned above.