Politics of the European Union too often have damaging consequences for developing countries. Fair Politics EU wants to give developing countries a fair chance at development. - Fair Politics NOW!

Raw Materials: a blessing or a curse?

Ranking

no ranking for this case

Topic: Raw Materials

Policy recommendations

  • The European Union should allow ACP countries to maintain their sovereignty and policy space in relation to the appropriate use of their own natural resources. They should be able to use investment regulations, tariff barriers and export restrictions to promote equitable, local and sustainable economic development.
  • The European Commission through its development policy should stimulate resource-rich developing countries to implement their own industrial policies, to protect their infant industries by using legitimate barriers to trade, and by introducing environmental measures. This should allow resource-rich developing countries to move up the value chain, so that the added value to (semi) processed products will remain in the country of origin and would thus stimulate economic development.
  • Within its development budget the EU should allocate sufficient resources to the building of energy and environmental infrastructure to enable developing countries to stimulate economic development.
  • The EU should use its political and economic power to set clear rules in relation to the extraction of raw materials. Like suggested in the February 2011 RMI update an EU code of conduct for EU companies operating in third countries should be developed and measures should be taken to enforce such a code of conduct.
  • In order to provide for more transparency in the supply chain and to minimize the role of European companies in fuelling conflicts over resources, the EU should implement Country by Country reporting, following the US example of the Dodd Frank Act.
  • Within the EPA negotiations the EU should be more flexible as suggested in the RMI update and make sure developing countries can demonstrate the use of export taxes as a policy tool and therefore keep using them.
  • In all policy initiatives and actions elaborated on the basis of the strategy laid down in the Raw Materials Initiative that affect developing countries, DG Development should be closely involved, and ACP partner countries and civil society organisations should be consulted.

 

 

Recommendations

Make it fair!

  • The EU should allow least developed ACP countries full flexibility to raise export taxes for development purposes in EPA negotiations and other trade agreements with the EU.
  • The EU should support the development of downstream industries in resource rich developing countries by implementing support programmes under its development policy, with the primary aim of helping developing countries to move up the value chain.
  • The EU should rightly implement and monitor the adopted legislation on country by country reporting, and thus improving the financial transparency of EU companies operating in developing countries.
  • The EU should adopt legislation on Non Financial Reporting, which makes it mandatory for EU enlisted countries to report upon their social, environmental en human rights impact in a coherent manner, which allows independent monitoring and evaluation.
  • The EU should adopt legislation on Conflict Minerals which prevent the use of conflict related minerals in the production chains of the EU’s manufacturing industry.