An Impact Study of the EU-ACP Economic Partnership Agreements (EPAs) in the Six ACP Regions

91 Pages Posted: 3 Aug 2008

See all articles by Lionel Fontagne

Lionel Fontagne

University of Paris 1 Panthéon Sorbonne; Paris School of Economics; CEPII

David Laborde

International Food Policy Research Institute (IFPRI)

Cristina Mitaritonna

Centre d'Etudes Prospectives et d'Info. Internationales (CEPII)

Date Written: April 1, 2008

Abstract

This study intends to present a very detailed and dynamic analysis of the trade-related aspects of Economic Partnership Agreements (EPAs) negotiations. We use a dynamic partial equilibrium model - focusing on the demand side - at the HS6 level (covering 5,113 HS6 products). Two alternative lists of sensitive products are constructed, one giving priority to the agricultural sectors, the other focusing on tariff revenue preservation. In order to be WTO compatible, EPAs must translate into 90 percent of bilateral trade fully liberalised. We use this criterion to simulate EPAs for each negotiating regional block. ACP exports to the EU are forecast to be 10 percent higher with the EPAs than under the GSP/EBA option. On average ACP countries are forecast to lose 70 percent of tariff revenues on EU imports in the long run. Yet imports from other regions of the world will continue to provide tariff revenues. Thus when tariff revenue losses are computed on total ACP imports, losses are limited to 26 percent on average in the long run and even 19 percent when the product lists are optimised. The final impact on the economy depends on the importance of tariffs in government revenue and on potential compensatory effects. However this long term and less visible effect will mainly depend on the capacity of each ACP country to reorganise its fiscal base.

Keywords: Preferential Trade Agreements, Africa, EPAs, Simulations

JEL Classification: F13, F15, O55

Suggested Citation

Fontagne, Lionel and Laborde, David and Mitaritonna, Cristina, An Impact Study of the EU-ACP Economic Partnership Agreements (EPAs) in the Six ACP Regions (April 1, 2008). Available at SSRN: https://ssrn.com/abstract=1194965 or http://dx.doi.org/10.2139/ssrn.1194965

Lionel Fontagne (Contact Author)

University of Paris 1 Panthéon Sorbonne ( email )

Maison des Sciences Economiques
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Paris, 75013
France
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Paris School of Economics ( email )

48 Boulevard Jourdan
Paris, 75014 75014
France
+33 1 44 07 89 94 (Phone)

HOME PAGE: http://lionelfontagne.weebly.com/

CEPII ( email )

9 Rue Georges Pitard
Paris, 75015
France
+33 1 53 68 55 06 (Phone)

HOME PAGE: http://lionelfontagne.weebly.com/

David Laborde

International Food Policy Research Institute (IFPRI) ( email )

United States

Cristina Mitaritonna

Centre d'Etudes Prospectives et d'Info. Internationales (CEPII) ( email )

9 rue Georges Pitard
Paris Cedex 15, F-75015
France

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