Confirming the status quo: the political economy of EU-ACP economic partnership agreements

ABSTRACT

This paper examines how the European Union's good governance initiatives under its sustainable development agenda affect ratification of Economic Partnership Agreements (EPAs) with African, Caribbean, and Pacific (ACP) countries. The theoretical framework argues that the likelihood of ratification is influenced by adjustment costs a signatory faces in implementing EPA provisions. We focus on the level of corruption as indicative of adjustment costs. In partner countries where corruption is high, EPAs that stipulate the lowering of tariffs and improved sustainability standards would clash with the interests of ACP elites and result in hefty adjustment costs. Empirical analysis of 78 ACP countries supports this argument. Results show that the likelihood of EPA ratification is lower in ACP countries with high levels of corruption. They support prevailing theories of self-selection into international agreements, where a given signatory is more likely to ratify agreements close to its institutional status quo.

KEYWORDS:

• Corruption
• economic partnership agreements
• EU-ACP
• ratification
• sustainable development

Acknowledgements

We are grateful to two anonymous reviewers for their constructive feedback; and to Dylan Jun Jie Leong for excellent research assistance.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Notes

1 The official count of ACP countries is 79. Cuba is not included in the analysis as it is not a signatory of the Cotonou Agreement.

2 Cases of coup d’états resulting in EU sanctions include Fiji (2000 and 2007), Central African Republic (2005), Guinea-Bissau (2004 and 2011), Madagascar (2010) and Burundi (2015). Zimbabwe, in 2002, was the only country ever to be sanctioned by the EU for violations of human rights.

3 Bivariate analyses pairing levels of corruption with tariff levels and environmental standards, provided in Figure 1 of the Online Appendix, provide some evidence of the relationship between higher corruption and higher tariffs/low environmental standards.

4 WTO Membership List: https://www.wto.org/english/thewto_e/whatis_e/tif_e/org6_e.htm

5 The list of countries deemed by the EU to be an LDC is published at: http://trade.ec.europa.eu/tradehelp/everything-arms

6 Odds ratios for all other models are presented in Table 2 of the Online Appendix.

7 Figure 2 of the Online Appendix provides supplementary analyses focusing on the LDCs.

Additional information

Notes on contributors

Darren Cheong

Darren Cheong is a graduate student at the Department of International Relations, London School of Economics and Political Science.

Soo Yeon Kim

Soo Yeon Kim is Associate Professor and Head of Department of Political Science, National University of Singapore.