Africans wary of Europe's trade offer

By Will Ross
BBC West Africa correspondent, Ghana

As African and European leaders meet in Portugal, one of the most important issues on the agenda is trade.

European trade has given Ghana's farm workers a stable income

But a new trade agreement being offered by the European leaders has proved controversial and few countries have agreed to sign up.

An hour and a half by road from the Ghanaian capital Accra, Billy Gameti is inspecting his pineapple crop.

He leases 75 acres (30 hectares) of land and employs 25 workers. Starting early in the morning to avoid the intense heat, one of the workers, Moses, bends over to pick the pineapples and tells me how this job has helped him.

"I can pay school fees for my two children, pay the electricity bills, my rent and also borrow some money if I need to from the boss."

A 20-minute drive away, 1,500 men and women work in shifts at the Blue Skies factory which buys the produce from 130 farmers like Billy Gameti.

They are preparing pre-packed fruit salads and juices for the European supermarkets - about 20 metric tons of pineapples, papaya, mango and coconut leave by truck for Ghana's international airport every day.

Export challenges

These fruit salads may be healthy but this kind of business is criticised by some because of the impact on global warming. With some fruit currently out of season in Ghana, the mangoes are flown in on a charter flight from Brazil and the pomegranates come from Egypt.

Exporting food from Ghana is fraught with problems

The business is booming. Turnover was around $50m (£25m) last year and it is growing by 25% a year.

The challenges of exporting perishable goods, especially in Ghana's climate, are great - the European supermarkets are unbelievably fussy customers, Ghana's electricity supply is far from guaranteed, the road to Accra is currently appalling and there have been problems with the supply of aviation fuel at Ghana's airport.

But once these challenges have been overcome, at least Blue Skies has been able to sell to Europe tariff-free.

But for how long?

The current preferential trade agreement between the European Union and almost 80 countries has been declared illegal by the World Trade Organisation, so a new deal has to be found or else companies like Blue Skies will suddenly be faced with tariffs at the end of this month.

"Our juice products to UK supermarket Marks and Spencer would immediately become unviable and the remainder of our products would take a significant hit," says Blue Skies chairman and founder Anthony Pile.

He says the company would try to re-negotiate prices with European supermarkets.

"But a price increase is extremely difficult and if no solution was found the possibility of relocating the company elsewhere would be looked at."

Divide-and-rule strategy

There is an offer on the table from Europe - the Economic Partnership Agreement (EPA).

You can play the piano with the white keys only or you can play it with only the black keys - but for harmony you must use the black and the white keys Ernest Debrah Ghanaian agricultural minister

If countries sign they can continue to get their products into Europe duty-free but this agreement - which the Europeans are pushing hard - would also mean allowing most European goods into countries like Ghana duty-free. There are fears local industry in Ghana would struggle to compete.

"What the Europeans are putting in place is aimed more or less at undermining the attempt by African economies to move away from the dependence on exporting raw materials towards industrial processing," says Tetteh Homeku of the research and advocacy group Third World Network.

Tetteh Homeku says the Europeans are also interfering with the Ghanaian government's attempts to nurture its industry, and sidelining other trade agreements which would serve poor countries like Ghana better.

He points to the Generalised System of Preferences, or GSP Plus, which is a European trade deal for countries whose economies are poorly diversified and therefore dependent and vulnerable.

Countries in the regional grouping Ecowas have failed to adopt a common position on the European offer and Ivory Coast is so far the only West African nation to have signed an interim deal.

Some analysts suggest that, by negotiating agreements with separate countries, European leaders have adopted a divide and rule strategy aimed at weakening any possible regional clout.

With the threat of: "Accept this EPA deal now or pay tariffs from the start of next month," it is not surprising that the likes of the fruit exporters are getting nervous and are pushing the government here to sign.

'Lack of harmony'

The Ghanaian government now has to appease both the exporters like Blue Skies and those who fear the impact of the EPA on local industry.

Many remain unconvinced that Europe really wants to help Africa

Agriculture Minister Ernest Debrah says the time for "winner takes all" is over and, as leaders from Africa and Europe meet in Lisbon, he calls for a more harmonious relationship between Africa and Europe.

"You can play the piano with the white keys only or you can play it with only the black keys. But for harmony you must use the black and the white keys," he says.

"If you continue to take too much of the advantage then you create a situation where you've got a stronger and a very weak side and we don't get the harmony we deserve.

"We must look at balancing the global issues so that we can live on this globe very peacefully."

While there is talk at the Lisbon summit of a new better relationship between Africa and Europe, this controversial trade agreement has done little to convince the sceptics that European leaders are really determined to help Africa develop.