Policy recommendations

  • ACP countries should be able to maintain their sovereignty and policy space in relation to the appropriate use of their own natural resources. They should be able to use investment regulations, tariff barriers and export restrictions to promote equitable, local and sustainable economic development.
  • By implementing their own industrial policies, and by protecting their infant industries through legitimate (non tariff) barriers to trade, and by introducing environmental measures, resource-rich developing countries should be allowed to move up the value chain, so that the added value to (semi) processed products will remain in the country of origin.
  • The EU should not compete in the ongoing race to the bottom for natural resources, but rather use its political and economic power to set clear rules in relation to the extraction of raw materials. Plus the EU should take steps to decouple its own economy from excessive resource dependence, and invest more in research and development of substitutes, and recycling programmes.
  • In the short term, in order to minimalize the role of European companies in fuelling conflicts over resources, better transparency throughout production and supply chains is needed. The EU, following the bi-partisan example in the US, should consider introducing transparency legislation with a view to preventing conflict resources from entering the EU market.
  • In all policy initiatives and actions elaborated on the basis of the strategy laid down in the Raw Materials Initiative that affect developing countries, DG Development should be closely involved, and ACP partner countries and civil society organisations should be consulted.

 

Case: Raw Materials Initiative

17-11-2009 The Raw Materials Initiative and Policy Coherence for Development under discussion in our Expert Meeting

On Tuesday the 17th of November, in a room deep into the busy European Parliament, the Fair Politics Expert Meeting on the Raw Materials Initiative (RMI) and Policy Coherence for Development (PCD) took place. This meeting aimed to create awareness and debate on this potentially tricky initiative launched by the European Commission in November 2008 by bringing together policy makers from the European Commission, European Parliament Members, NGOs, business and experts from both Europe and Africa. The Fair Politics case study working paper on the issue was also to be launched. All this in order to prevent the RMI from being developed into an aggressive strategy in favour of European industries.

We had to wait for our prime speaker of the day, Mr Claude Kabemba from SarWatch in Johannesburg who faced a disfunctioning Brussels taxi service, before we could kick off with this relevant and interesting meeting. Our chairs and hosts of the day, Thijs Berman (S&D, Development Committee) and Fiona Hall (ALDE, Committee on Industry, Energy and Research), opened the meeting with short statements in which they expressed their concerns on raw materials sectors in developing countries. They emphasised the need for good and comprehensive rules on extraction and trade in these, as well as compliance with the rules (such as decent tax paying) by multinationals.

After an introduction on our foundation and the change from EU Coherence to Fair Politics since we need political will to be coherent and fair by our director Peter Heintze, the Fair Politics case study was introduced by policy officer Suzan Cornelissen. She explained the worries that arise when reading the aggressive language of the RMI, such as The EU should work towards the elimination of trade distorting measures taken by third countries. Fair Politics wonders of course what this will mean to developing countries, as there are many resource-rich African countries, and what the EU considers justified and non-justified and thus to be eliminated - export restrictions in this context. Past experiences have also shown issues of implementation in many of the good governance and capacity building development projects. If social economic (and industrial in terms of decreasing dependence on the net export of basic raw materials) development is not enhanced by this initiative, or rather worsened, then it would clearly not be in line with development commitments in terms of fighting poverty and a smooth and beneficial integration of developing economies into the world economy. Commitments to PCD as stated in article 178 would therefore not be complied with.

After this, presentations by Paul Anciaux of DG Industry & Enterprise, Claude Kabemba and Jan Capelle (IPIS/ Fatal Transactions) followed, as well as a - heated - debate including BUSINESSEUROPE, DG Development, DG Trade and different civil society participants. For a full report of the meeting, click here.

Fair Politics feels it was a very interesting and successful meeting and we very much thank the chairs, speakers and all participants for their important contributions. It surely increased awareness (and some understanding) of the RMI and different existing positions, as well as raising many new issues and questions to be addressed in the future. To be continued

The main outcomes of the meeting were:

·         Both MEP chairs expressed strong concerns for the implementation of the initiative and emphasised the need for developing countries to be able to benefit from their resources with strict rules for business and a good governance and pro-development and environment framework. They were surprised by the lack of involvement of the European Parliament and both committed to raising the issue there and looking into the possibility of an own initiative report in one of their committees. A CSR hotline to report misbehaviour of companies was also suggested by Thijs Berman.

·         The representation of all relevant DGs from the European Commission and their expressed interest in the debate was indicatory of the relevance of the topic and has ensured that the voices of our experts, MEPs and civil society have been heard. DG Development openly asked for help and input from civil society, that has so far been lacking in the development of this initiative.

·         Not only the presence of different MEPs and assistants, but also the various NGOs presence have surely increased awareness of this somewhat unknown strategy paper. Many participants have expressed their will to follow-up on this and increase work on the issue.

·         Some important observations and recommendations were made by our Southern expert, Mr Kabemba, who emphasised the major impact of the RMI to states and lives in Africa. This in a way that is contradictory to the African Unions vision on Raw Materials, namely the need for taking local ownership, communities and Africas own need for resources into account. The balance of power needs to be changed in order to prevent the RMI from being a dry-cleaner of old strategies. If not, the resource nationalism on the continent that the EU fears will really be spurred. Click here for a full reaction from SarWatch to the RMI.

·         Recommendations from Fair Politics were largely reflected in the debate, such as the need for policy space for developing countries to develop industries and diversify their economies, as well as the need for true implementation of good governance and transparency initiatives. Outstanding questions remain on the true implementation of the RMI in EPAs with Africa and the extent to which the EU will be flexible as they say.

·         The past has shown a lack of true implementation issues and considering the amount of good initiatives the RMI broadly refers to, there is a danger for this to happen again. Fatal transactions sticks to its policy recommendations as proposed in the Memorandum and would like to fight fragmentation and lack of coherence in the EUs approach to Africa(s resources). (for the full Memorandum click here)

·         As business stated No one will win in a global trade battle for raw materials and there is a need to look at what unites us and create win-win situations, in which business also has a direct interest in the development of African countries. At the same time it should be recognised that there can be conflict of interests as well, that will have to be openly discussed and require political will to create Fair Politics.