The EU Everything But Arms Initiative and the LDCs

Abstract

In recent years there have been increased pressures to help the poorest nations through aid, debt relief and trade initiatives. At the first Ministerial Meeting of the WTO in Singapore in 1996, the then Director-General of the WTO, Renato Ruggiero, declared his intention to press WTO members to afford tariff and quota-free entry to imports from the least developed countries (LDCs) to the markets of the developed countries. This initiative bore fruit in 2000, when the EU Trade Commissioner, Pascal Lamy, announced the intention to grant duty-free and quota-free access for all goods (with the exception of arms) originating in LDCs — its ‘Everything But Arms’ (EBA) initiative, under which it proposed to reduce to zero all tariffs on imports from LDCs except arms and to free such imports from any quantitative restriction. Other developed countries have made similar proposals, including the US African Growth and Opportunities Act (AGOA), but in terms of the value of trade the EU proposal is the most important. This chapter evaluates the EU proposal, using ex ante trade simulation techniques, and draws some tentative conclusions.

The views expressed in the chapter are those of the authors, and do not necessarily represent the views of the organizations for which they work nor the member states of those organizations.