EU Coherence in Trade, Conflict Management and Common Foreign and Security Policy

Since the conclusion of the Maastricht Treaty, coherence of EU action has become a fundamental principle which is expected to guide all European policies that affect developing countries. Coherence has become a priority for development-minded actors such as NGOs, who are scrutinising EU policies to make sure that development priorities are not compromised. The main political battlefield has been the EU’s Common Agricultural Policy (CAP), where inconsistencies with development aims have been widely documented and exposed.

Other policy areas, by contrast, have attracted much less attention. A case in point is the coherence in EU policy between trade, conflict management, and the common foreign and security policy. In recent years, a growing number of poor developing countries and populations have become trapped in conflicts with major detrimental effects on development. The EU has sought to respond to these complex political emergencies with traditional means, (eg, humanitarian aid) and with new policies and instruments (eg, conflict prevention, political dialogue, etc). Yet recent experiences suggest that the EU’s involvement in conflict management raises thorny issues of coherence that deserve to be charted, documented and debated.

Conflict Management

When looking at trade from the perspective of conflict management, it is striking to see how multi-dimensional the impact of trade can be. First, trade, economic liberalisation and related adjustment policies are generally assumed to be the driving forces behind development and key instruments to foster the integration of the ACP countries in the global economy. Yet what about the relationship between economic liberalisation and political stability? Are EU trade policies towards ACP countries consistent with the need to eradicate poverty or to prevent increased marginalisation and exclusion of people in ACP societies – factors that contribute heavily to conflict? Second, EU efforts to promote regional integration are seen as a potentially very important tool to prevent conflict (with the EU’s own economic integration process serving as an example). Third, trade can help trigger conflicts, for instance when the benefits from trade in natural resources on the international markets (eg, oil in the Niger Delta) are siphoned off by central governments and foreign firms to the exclusion of local communities (see earlier articles on Angola and Sierra Leone). Fourth, the lucrative North–South trade in arms is a well known factor that fuels conflict in many countries and a major case of inconsistent policy at EU level. Fifth, the (illegal) trade in natural resources (eg, diamonds in Angola and the DRC) generates new resources for fighting parties to buy weapons and maintain their armies. Moreover, since conflict allows for such rents to be captured by war-waging factions, it provides an incentive to maintain the conflict situation. Sixth, trade can be used to stop conflicts through the much debated instrument of trade sanctions.

Finally, one should not forget that conflict curbs ‘normal’ trade flows and leads to a drastic drop in official tax revenues on trade. This, in turn, may render any return to a situation of peace and reconstruction even more troublesome. Somalia, for instance, has suffered from the lack of international representation and recognised national institutions required to meet the increasing number of trade regulations. While livestock trade was gaining strength, the Saudi government once more instituted a ban on Somali livestock in February 1998 due to reports of Rift Valley fever in East Africa. It is estimated that this may have led to a cut of livestock earnings by half in 1998 (Visman, E (1998) ‘Cooperation with Politically Fragile States: Lessons from EU Support to Somalia’ ECDPM Working Paper No. 66, December).

What Chance a Coherent Policy?

Until now, these questions of coherence in EU policy between trade, conflict management and foreign and security policy towards ACP countries have not been addressed in a comprehensive and systematic way. If anything, trade and conflict management policies, strategies and instruments have tended to evolve along parallel tracks, resulting in fragmentation and limited cross-fertilisation  This partly explains why the current Lomé Convention – the EU’s major cooperation agreement with 71 ACP countries involving aid and trade support – does not provide a very solid ground to deal with coherence issues between trade and conflict management. The policy and institutional framework to discuss these questions in a strategic and operational way is simply missing. By contrast, the EU cooperation agreement with the Mediterranean countries is much more couched and practised in the perspective of security and political stability, reflecting the stronger domestic policy agenda of the EU towards this region.

Can major changes be expected with the successor agreement to Lomé IV? After more than two years of debate and negotiations, both the ACP and the EU stand to renew and extend their partnership. A new cooperation framework has been agreed upon, which will most probably be signed in May 2000 in Fiji and receive the name of the host location (ie, the Convention of Suva). In many ways, the new agreement marks a break with the past. Important innovations have been introduced, aimed at adapting ACP– EU cooperation to the challenges of the new millennium.

At first sight the picture also looks more promising for future EU policies towards conflict countries. The new agreement, for instance, considers ‘political dialogue’ as a cornerstone of future ACP–EU cooperation. Conflict prevention management and resolution, as well as arms trade, are  explicitly mentioned as keys of political dialogue (draft article 8). A basic policy framework in favour of peace, conflict prevention and resolution is integrated in the new Convention (draft article 11), again with a clear reference to the need to better control the spread and illegal trade in (small) arms. Furthermore, conflict prevention is seen as a major objective of regional cooperation efforts (draft article 29.3)

On the whole the new Convention will represent a unique package of cooperation tools between the EU and ACP states, including political dialogue, trade cooperation and financial support. In theory, this package should, more than any other agreement, allow for a coherent use of these tools to reinforce one another, and in particular to:

1. use trade development as a means to prevent conflicts;
2. regulate trade in arms;
3. mitigate potential tensions arising from ACP–EU trade in natural resources;
4. provide guidelines on whether and how to trade with ACP countries at war or in conflicts;
5. ensure proper trade policies and support measures in post-conflict situations.

On second analysis, however, it remains to be seen how both parties will be able to put these principles into practice. There is no shortage of obstacles on the road to effective implementation, including the scarcity of reliable information and data on the complex relations between trade and conflict; the lack of adequate human and institutional capacities at different levels to properly integrate the trade and conflict dimension; the reduced political clout of ACP countries in the overall configuration of the EU’s external relations, sometimes verging on the brink of indifference; the resistance likely to be offered by a wide variety of ‘vested interests’ who have much to gain from a continuation of situations of instability in parts of Africa; and the limited number and fragmentation of European civil society actors working on issues of coherence in EU policies between trade and conflict management, making it difficult to mobilise the necessary ‘critical mass’ to influence policy, etc.

Against this background a number of ‘priority actions’ emerge:

1. Start building a development coalition of a wide variety of actors and institutions which have a stake in a more comprehensive and coherent EU policy towards conflict countries (eg, multilateral and biliateral donor agencies, research institutions, NGOs, development-minded business organisations, local actors, etc).
2. Improve the information and statistical basis upon which to base future EU policies, as well as investigate in research linkages between trade, conflict management and foreign and security policies, both at the general conceptual level and on a country basis.
3. Promote an effective use of the new provisions for political dialogue contained in the new cooperation agreement between the EU and the ACP countries. On paper, political dialogue could provide the much needed (decentralised) framework to discuss the root causes of conflict; to identify the different actors and responsibilities involved; and to work out a comprehensive strategy for conflict management, which fully integrates the trade dimensions. In practice, there is not much experience with using this tool. Furthermore, the internal crisis and reform processes now underway at the level of the Commission may hamper effective progress.
4. Undertake advocacy at national level. Most of the inconsistencies in EU policies towards developing countries are rooted in the narrow domestic interests of member states.

The EU Presidencies and Development Council provide a clear momentum for pushing the coherence debate forward, especially towards conflict countries. All this can only reinforce the need for bold, concerted and targeted action from the international civil society and research world.

ECDPM stands for the European Centre for Development Policy Management. It is a Maastricht-based foundation specialising in ACP–EU cooperation. Tel: (31) 43 350 2903 Fax: (31) 43 350 2902 Email: <info@ecdpm.org> Website: <www.oneworld.org/ecdpm>