The SADC Region and EPA/EBAI - Potential Winners and Losers

Abstract

The aim of the paper is to investigate convergence tendencies in the SADC region and to determine whether the EPA/EBAI policies between SADC and EU_27 member states will promote such convergence tendencies. The analyses of the EPA/ABAI policies make further conclusion on SADC member states’ potential winners and losers from changes in trade profile brought about by these policies since individual SADC member states are heterogeneous in their trade profile. Therefore these policies outcome will likely have negative or positive effects on economic growth and convergence tendencies of individual member states of the SADC region. The study has found evidence of absolute convergence in the SADC region using income and GDP growth rates data for the year 2008 to 2015. Further analysis of the effects of the EPA/EBAI policies reveal that SADC LDC are likely to be winners except Madagascar and Tanzania while the SADC ACP countries are possible winners on condition they set up enabling environments that promote development of industries where they are likely to benefit more given their export profile which is an indicator of their comparative advantage. It is further concluded that overall the EPA/EBAI will likely promote convergence tendencies and be beneficial to the region as a whole.EPA/EBAI policies; SADC; EU_27; ACP; LDC; Convergence; GTAP