Free trade plan may force millions into poverty

PETER MANDELSON, in his role as European trade commissioner, will today be grilled by MPs over free trade proposals between the EU and some of the world's poorest countries which aid agencies say will force millions of people into poverty.

The International Development Committee will challenge Mr Mandelson over the EU's plan to open up trade with African, Caribbean and Pacific (ACP) countries. The agreements, to begin in 2008, would allow ACP countries free access to EU markets, but gives EU states reciprocal access.

Six MPs on the committee, including the chairman, Tony Baldry, have signed a Commons motion protesting against the Economic Partnership Agreements (EPAs), fearing that subsidised EU exports will flood the developing world, preventing countries from nourishing their own industries. Some 152 MPs have signed the motion, Kofi Annan, the UN secretary general, has voiced concern, and 120 groups within the ACP countries are campaigning against the proposal.

As negotiations between the European Commission and the ACP states continue, the committee is investigating the implications of the EPAs.

Of particular concern are stipulations covering investment, competition and government procurement. The EU wants to force ACP countries not to discriminate against foreign companies when awarding contracts and not to penalise foreign investors. There are fears that competition with European multinational companies will destroy domestic development.