November 14, 2006

Preliminary Findings in the ACP Case Study

My preliminary findings in the ACP case study can be found in a summarized form below. In general, it seems that changes in an international environment that once favored the creation of a regime of non-reciprocal trade preferences to former colonies fundamentally undermined the basis of Lomé, and led to the reorganization of the ACP-EU regime under the auspices of Cotonou:

1. The reorganization of the regime owes much to the emphasis the EU now places on WTO compliance, but doubts remain as to whether this is not simply a device to legitimate Economic Partnership Agreements (EPA’s) that the EU wishes to pursue as part of its Cotonou strategy: essentially FTA’s with several regional ACP country groupings

2. Officials have also underscored that the “experience with ACP countries was that preferences were necessary but not enough for development.” Cotonou, a more comprehensive development agreement in their eyes, seemed to the well-intentioned

3. Cotonou is seen by EU officials as “neither a trade agreement nor a completely political agreement but a mixture of the two.” (Council Interviews in March 2006) This underscores a growing trend towards conditionality not only in the ACP-EU framework, but also within the EU’s generalized preference schemes for developing countries: in the Generalized System of Preferences (GSP) and its enhanced counterpart Super GSP.

4. The entry of new members has shifted EU priorities towards its neighbors and away from the traditional emphasis on post-colonial relationships.

Evolving Structure of Project: Case Studies as the Basis for Analysis

Most of our work on the project so far has consisted on analyzing two case studies of European bilateral trade agreements, with the ACP group and with India. In addition we hope to add a case study on the EuroMed agreements. The structure of the project would therefore emerge as follows, with the case studies (section 3. below) as the main focal point of the project):

1. Introduction

2. General overview sections considering:

a) A consideration of public policy in the EU and its impact on trade policy

b) The EU in the WTO

c) The overall economic impact of the EU’s bilateral trading relations

3. Case studies (including statistical analysis)

a) The Lome/Cotonou framework of ACP-EU relations

b) The Euromed agreements

c) A consideration of the new FTA’s the EU is considering, and as an example of particular import, India

4. A section drawing all themes together and relating it to the central question

5. Conclusion and future prospects

Presentation at a Higher Education Academy (HEA) Event on October 25th, 2006

We were lucky enough to be able to present the main aspects of our project at an HEA Event held in the Panorama Round entitled: “Research-Based Learning in Higher Education: the Warwick Experience”. Our presentation was part of a larger presentation of the work of the Reinvention Centre at Warwick.

Part of our script for the presentation is reproduced below:

”... Our project was not only our very own intiative from the start, but was at all times a student-led experience. Although we did have a couple of members of staff in the Politics & Economics Departments helped us tweak our research question and proposal, we decided on the rest. Udayan was going to focus on the economic issues underpinning the EU´s trading patterns, through statistical and economic modelling while I focused on the qualitative analysis of the political factors. And what better way of getting a sense of the actual politics involved by actually visiting Brussels and questioning senior civil servants?

The Reinvention Centre grant we received mainly paid for our two-week trip to Brussels in March of this year, which allowed us to interview those members of the Council and Commission staff that had agreed to meet us to discuss their role in EU trade policy-making, including Head of the Agriculture Unit in the Council, members from DG Trade and External Relations in the Commission and the spokesman for the Development & Humanitarian Aid Commissioner Louis Michel. We grilled them, among other things, on the trade aspect of the CAP, on the Doha Round, on the much-criticized Economic Partnership Agreements… All in all, it gave us over 10 hours of interview material to sift through, which greatly enhanced our appreciation of the issues at stake and gave a potentially “dry” topic a distinctive “edge”.

What did we find through our project? Three things, essentially:

1. Trade agreements are increasingly a means of exerting political leverage through reinforced “political conditionality” clauses.

2. EU officials largely considered the pursuit of bilateral (preferential) trade agreements to be complementary to WTO (multilateral) trade negotiations, even though our research seemed to suggest the emergence of a “hub-and-spokes” system benefitting the EU.

3. The shifting foreign policy and economic priorities of its member states are strongly reflected in the evolving character of the EU’s bilateral trade agreements.

Personally [I Gabriel Siles], have always had the ambition to go into academia (first as an astrophysicist when I was quite young) and now in Political Science. The Reinvention Centre gave me the chance to take the initiative and see for myself what it is like to draft a research proposal, conduct primary research, and compile my findings, things all (good) academics must be quite competent at. Because I found the whole experience so thrilling, my ambition has really been galvanized. I now really want to undertake original research as soon as possible, hopefully through an ESRC 1+3 (or 2+2) studentship of a one (or two)-year research masters followed by 2 or 3 years of doctoral study, and that in the field I researched thanks to the Reinvention Centre: the political economy of international trade.

I’d say that the whole experience has really shown me what I want to do, and how I want to accomplish it, and that more so than any other aspect of my life at University.”

March 19, 2006

Our Project's Timetable

Milestones and Targets throughout the duration of the project:

Term 1 Week 10/Christmas vacation: Continue preliminary research.

Term 2 Week 3: Preliminary research finished. Begin in-depth research. (This will involve an in-depth study of the statistics obtained, searching for specialist books/articles on the subject and meeting and interviewing key people, as outlined below.)

Term 2 Weeks 4–10: In-depth research: touring libraries in the UK, potentially meeting with British MEP’s, visiting the local EU Office in London, travel preparations for trip to Brussels.

Easter Vacation: Travel to Brussels for a week to interview EU functionaries, press spokespeople, and MEP’s. Begin compiling of research.

Term 3, after exams: Finish compiling of research. Begin drafting report on findings. Start promoting project among academics (see dissemination plan).

Term 3 Week 10: Finish summary report and submit it to the Reinvention Center.

Summer vacation: Finish drafting report on findings. Draft possible academic journal article(s). Forward findings to EU functionaries and MEP’s who collaborated.

Academic Year 2006/7 Term 1 Approx. Weeks 3–4: Publish summarized findings in student media. Publicize seminar.

Term 1 Approx. Week 5–7: Hold seminar. (see dissemination plan)
Estimated Completion date: November 2006.

Our Project's Rationale

This project affords us the opportunity to explore, through our very own research, some of the themes and develop many of the skills that are being covered by our respective syllabi while at the same time retaining in the interdisciplinary element of our degree courses. In other words, it allows us to put into practice many of the ideas and techniques we have been learning about in lectures and seminars, particularly in the fields of economics, econometrics, and political economy. By actually travelling and being in the field doing research, this project will allow us to broaden our horizons and delve into several alternative sources of knowledge that conventional University teaching only marginally explores.

Similarly, we will be able to develop a range of research skills, the combination of which is uncommon in our disciplines: compiling statistical data, interpreting key policy documents, interviewing functionaries and politicians.

Our project is very much related to our own respective degree curricula. One of the assignments in our core Econometrics module, for instance, will be asking us to compile our own data and perform an econometric analysis of it, something our project will be incorporating. Furthermore, many of the economic issues pertaining to trade that we will be exploring are addressed by our compulsory Economics module, while issues of political economy and trade, key to this project, figure quite prominently in a core Politics and International Studies module.

Similarly, this project could quite easily be linked to a dissertation in our third year of undergraduate study at University.

Our Project: An Outline

The European Union (EU) has a number of preferential bilateral trade agreements with third parties that allow these countries more favorable trading terms and access to the European market. What is more, bilateral trade agreements are never just simply that; they also address issues of economic cooperation and development, and are often conditional on the meeting of specific political and institutional criteria. The Cotonou Agreement, its precursor the Lomé Convention, and the “Barcelona process” of Euro-Mediterranean integration, are just a few examples of this sort of agreement. Given the seemingly obvious economic benefits, why have most of the world’s states not already signed such an agreement with the EU?

Whereas it seems, a priori, that economic considerations do play a role in the EU’s bilateral trade agreements, political and strategic factors are, in fact, very heavily at play. As a result, this project will attempt to reconcile both an economic approach to the question with one focusing on political economy.

Firstly, we will undertake an econometric analysis of the EU’s trade patterns with third parties to attempt to discern any possible economic motives in its signing of bilateral trade agreements. We hope to be able to determine a relationship between several variables, basing ourselves on existing models such as the “Gravity Theory of Trade.” This will include an examination of the markets of states both benefiting from and lacking bilateral trade agreements with the EU, the nature of such states’ trade with the EU, and possible economic interests in formalizing (and institutionalizing) a particular commercial relationship through a bilateral agreement.

This latter element of our more conventional economic analysis will lead into a more critical examination of the motives prompting both parties to sign (or not sign) such agreements. Having formulated an econometric model of trade between EU countries and a variety of trading parties, we will then undertake a much more detailed case study of the nature of the trade patterns for a bilateral trade agreement with the EU and for one which is not the subject of such an agreement, where special heed will be taken of political and other non-economic interests that condition the EU’s trade agreements. Through subsequent inference, hopefully an insightful conclusion will be reached as to what factors weigh more heavily in the EU’s and third parties’ decision-making processes when they consider the drafting and signing of trade agreements.

Given the wide range of approaches inherent to this project, several different analytical tools will be used: statistics, obtained from the European Union’s statistical service EuroStat, will be analyzed; key EU documents will similarly be examined, including the texts of significant trade/cooperation agreements; several European functionaries in both the Commission and the Council will be interviewed on policy considerations when considering the EU’s external trade.

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