Brussels Dispatch: Economic Partnership Agreements

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brussels-dispatch-economic-partnership-agreements

As Pat Barron commented last week: “[T]he reduction of development aid is an opportunity for [developing] countries to adopt their only hope of becoming "developed" countries, which is adopting capitalism to its fullest extent….Open borders to trade, without regard to reciprocity.”

This February in Strasbourg, the European Parliament adopted by 340 votes to 225 a Development Committee report on the Economic Partnership Agreements (EPAs) which moves the international development agenda forwards somewhat in this direction.  The EPAs are a vehicle for developing countries to augment regional free trade.

Capitalism and the free market represent the only known way for a country to work its way into prosperity.  Free trade is an important part of this process.  Tariffs, it should be remembered, in addition to raising revenue for the State, also ‘protect’ domestic markets from foreign competition.

So, the most important action that aid donors could perform, is to ask the question:  why are some countries good at generating wealth; whilst others remain impoverished?  The answer to removing people from absolute poverty does not lie in increasing donor expenditure; it lies in removing the inhibitions that currently impede development.

According to the OECD in the last 50 years, some $1.75 trillion has been spent internationally as Official Development Assistance on international development.  Which country is significantly richer through receipt of this largesse?

It makes me wonder whether the Left, which voted against the above report, and which defines itself by its commitment to the State and the State’s expansion - has an ideological vested interest in holding its dependents down.