The theory that trade is good for development is not really in doubt. The Peterson Institute for International Economics, for one, has estimated that global free trade could end poverty for 500 million people over 15 years. Most other economists, including at the World Bank and the OECD, have concluded that lowering trade barriers-unilaterally, regionally, or globally-is one of the most effective ways to “develop out of poverty.”   

But to make the theory a reality, developing countries must be able to negotiate trade agreements that enable them to get the benefits of trade. As yet, that has proved highly problematic.

A major reason is that developing countries do not have a great deal of leverage when negotiating trade agreements with the developed countries, which have many ways to exert pressure on the developing countries, for example, by implicitly threatening to cut back on or withdraw aid. This is a reality that is hard to change. However, another handicap for the poorer developing countries is simply a lack of human capacity.   

For example, Zambia, which is one of the world’s least developed countries, has a stable government and a liberal trade regime, but its resources for negotiating trade agreements are limited to a small handful of officials. Yet Zambia is in virtually non-stop international trade negotiations: in the Doha Round, in two overlapping regional associations that are aiming to create African common markets, and, like many other former European colonies, in a lopsided and time-pressured negotiation with the EU to replace preferential access to the EU market with a reciprocal “Economic Partnership Agreement” (EPA), under which goods from the EU will also have duty-free access to the developing country markets.

In order to help level the playing field, the International Senior Lawyers Project (ISLP), founded in 2000 to promote equitable economic development (along with the rule of law and human rights) has implemented a program to help develop trade negotiation skills in developing countries. In the last three years, ISLP has conducted trade negotiation workshops in Botswana, Rwanda, and Zambia, and it is planning future workshops in other least-developed countries in Sub-Saharan Africa.

The Zambia workshop, which was funded by a generous grant from the Hewlett Foundation, was conducted by three trainers.  One had been a lead U.S. negotiator for the U.S.-Canada FTA, another the head of the African Center for the Constructive Resolution of Disputes (ACCORD), based in South Africa. The workshop participants-14 from the government, three from the private sector-included lead trade negotiators and others with no exposure to trade negotiations at all. The highlight of the workshop was a two-day simulated negotiation, which the participants threw themselves into with great gusto. All agreed that the workshop had taught them a great deal about the techniques of negotiating trade agreements. .

The experience underscored how critical capacity building is for trade negotiations for countries like Zambia. If the EPA with the EU is not negotiated effectively, a deluge of imports from Europe could cripple Zambia’s efforts to diversify its economy and to encourage value-added industries. 

It appears that in the EPA negotiations the EU used a “divide-and-conquer” approach, putting pressure on individual countries to sign in order to continue their preferential access to the EU. Once one country had signed, the pressure on its neighbors to sign was enormous, since if they did not sign, their exports to the European market would be at a competitive disadvantage vis-à-vis the signer. 

Perhaps the developing countries would have been able to strike a better bargain with the EU if they had taken a unified approach. However, as explained above, the least-developed countries have little substantive leverage. But improving their technical negotiating skills may enable them to strike better bargains.  wt  



M. Jean Anderson, a Partner at Weil Gotshal & Manges LLP, practices international trade law in the firm’s Washington, D.C. office. Patrick Macrory, formerly an international trade lawyer in Washington, is the Trade Negotiation Training Program Manager for the International Senior Lawyers Project and Director of the International Trade Law Center of the International Law Institute.