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Traidcraft postcards on reforming world trade policies

Recently, we received a number of postcards from the Traidcraft campaign, concerning trade policy reform with developing countries. The senders express their worries about developing countries' lack of right to choose their own economic policies and ask for trade policies that will be beneficial for their entire population.

Postcard

"Many of the world's poorest countries are rich in valuable raw materials that, if managed well, can help create jobs, develop businesses and raise vital income. But the European Union is actively pushing trade and investment policies on poor countries that will deny them the right to choose economic policies that would ensure their raw materials are used to benefit their people and safeguard the environment.

Please ask the European Commission to:

Withdraw demands from all trade negotiations that would prevent poor countries using expert taxes to protect their raw materials and raise revenue.

Transform its position on investment to allow developing countries to regulate foreign investment and companies in the public interest.

Call for an international process to address how to manage raw materials in a fair and sustainable way and promote responsible consumption."

My reply

Dear Madam/Sir,

Thank you for contacting us.

The EU's trade development policy aims at ensuring that developing countries are able to benefit from access to the EU's market and from the openness of the global economy.

Economic Partnership Agreements (EPAs) are currently being negotiated with numerous regions and the EU but there are a number of controversial issues in them. As negotiations are progressing slowly, the ALDE Group (of which the Lib Dems are a part) feel that the Commission should revisit its strategy on EPAs. Indeed, the ALDE Group, while seeking to encourage trade, wants fair agreements and our rapporteur (leader) on all the EPA agreements, Niccolò Rinaldi, is pressing for the fairest possible outcome for the ACP countries.

In the European Parliament, my Liberal Democrat colleagues and I push for sustainable development chapters to be incorporated into all our trade deals.

For countries which are very poor, but have signed up to basic human rights conventions and enforce them, we have the GSP and GSP plus schemes which allow favourable access to our markets - this is essentially a one-sided deal to benefit them. Additionally, the Everything But Arms (EBA) arrangement, provides Duty-Free, Quota-Free access for all products for the 49 Least Developed Countries.

In terms of allowing developing countries to regulate foreign investment and companies in the public interest, my Liberal Democrat colleague Bill Newton Dunn MEP has recently been working on the future of foreign direct investment (FDI) in the Development committee. In a recent report he has called for the EU to respect developing countries' ownership of their economic strategies and cooperate with them to reach investment agreements that are mutually beneficial.

In 2008 the European Commission launched the Raw Materials Initiative. The Commission's communication explains that together with the European Investment Bank (EIB), the EU executive hopes to help resource-rich developing countries improve their transport, energy and environmental infrastructure.

To tackle corruption, the Commission also suggests offering more financial and political support for good governance in supply countries, via the Extractive Industries Transparency Initiative (EITI).

I hope you find the above of use and if you have any further concerns, please do get in touch.

Yours sincerely,

Diana Wallis MEP,
Vice President of the European Parliament