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This policy note argues that the low income of cocoa farmers in the cocoa-chocolate global value chain (GVC) is not only a problem in itself, but also exacerbates social and environmental sustainability issues such as child labor and deforestation. The experience of the last two decades has highlighted that private-sector, private-public, and public initiatives were important, but - overall - had insufficient impact on the livelihood of the average cocoa farming household. During the last few years, a shift from voluntary initiatives towards binding rules has emerged in the context of debates on the Living Income Differential (LID) in producer countries and due diligence laws in consumer countries, creating a new window of opportunity. The policy note concludes that - in the current world market situation - higher producer income cannot be ensured without new pricing mechanisms.

Die COVID-19 Pandemie hat zu einem starken Nachfrageanstieg nach Medizinprodukten geführt. Zeitgleich kam es zu Lieferproblemen in internationalen Lieferketten aufgrund von gesundheitspolitischen (z.B. Lockdowns) und wirtschaftspolitischen Maßnahmen (z.B. Ausfuhrkontrollen). Beides zusammen hatte temporäre Knappheiten von Gütern zur Folge und löste eine kontroverse Diskussion über die Vor- und Nachteile globalisierter Produktionsstrukturen aus, die nicht zuletzt auch zu starken Abhängigkeiten von einigen wenigen, primär asiatischen Standorten und Unternehmen, geführt haben. Vor diesem Hintergrund und basierend auf Fallstudien für Österreich diskutiert dieses Working Paper die Frage, welche Faktoren die Robustheit von Globalen Warenketten für Atemschutzmasken, Untersuchungshandschuhe und Beatmungsgeräte determinieren und welche nationalen bzw. europäischen Politiken dazu geeignet sein könnten, die Versorgungssicherheit mit Medizinprodukten und Medikamenten zu steigern. The COVID-19 pandemic led to a strong increase in demand for medical products. At the same time, supply problems in international supply chains kicked in due to health policy (e.g., lockdowns) and economic policy measures (e.g., export controls). Combined, both resulted in temporary shortages and triggered a controversial discussion about the advantages and disadvantages of globalized production structures, which led to strong dependencies on a few, primarily Asian, locations and companies. Against this background and based on case studies for Austria, this working paper deals with the question which factors determine the robustness of global commodity chains for respirators, protective gloves and respiratory equipment and which national and European policies could be suitable for increasing resilience in the supply of medical products.

The COVID-19 pandemic has exposed the fragility of medical product and pharmaceutical global value chains (GVCs). Against this background, debates on various policies to increase the resilience of these supply chains intensified. However, there is currently no consensus on which policies are required to ensure supply security for 'critical' or 'essential' products in the European Union (EU), and even the definition of these products is the subject of a debate. This report presents a detailed analysis of the medical products and pharmaceutical GVCs in order to foster our understanding of their vulnerabilities and to identify potentials for increasing their resilience. Given the large diversity of products within the medical and pharmaceutical sectors, the report presents a selection of three case studies on representative products for each of the two sectors/GVCs: (i) respirators, (ii) examination gloves and (iii) ventilators for medical products, and (a) penicillin (antibiotic), (b) paracetamol (analgesic), and (c) heparin (anticoagulant) for pharmaceuticals. The effects of COVID-19 on medical and pharmaceutical GVCs were distinct: most countries in the EU faced shortages of various critical medical products in early 2020, with negative effects on patients and health care workers. In contrast, COVID-19 induced shortages of pharmaceutical products were, so far and with a few exceptions, rare and with very limited negative effects for patients. Having said that, the COVID-19 pandemic highlighted already existing and potential new vulnerabilities for various pharmaceutical products in the EU. Die COVID-19-Pandemie hat die Anfälligkeit globaler Wertschöpfungsketten (GVCs) für Medizinprodukte und Pharmazeutika offengelegt. Vor diesem Hintergrund haben sich die Debatten über verschiedene wirtschaftspolitische Maßnahmen zur Erhöhung der Resilienz von Lieferketten intensiviert. Allerdings herrscht aktuell keine Einigkeit darüber, welche Maßnahmen zur Gewährleistung der Versorgungssicherheit für 'kritische' oder 'essenzielle' Produkte in der Europäischen Union (EU) erforderlich sind, und selbst die Definition dieser Produkte ist Gegenstand der Diskussion. Der vorliegende Report präsentiert eine detaillierte Analyse der GVCs medizinischer und pharmazeutischer Produkte mit dem Ziel ein besseres Verständnis für ihre Vulnerabilitäten zu schaffen und so Potenziale zur Erhöhung ihrer Resilienz zu identifizieren. Angesichts der großen Produktvielfalt innerhalb des Medizin- und Pharmasektors präsentiert der Report drei Fallstudien zu repräsentativen Produkten für jeden der beiden Sektoren bzw. GVCs: (i) Beatmungsgeräte, (ii) medizinische Handschuhe und (iii) Beatmungsgeräte für medizinische Produkte und (a) Penicillin (Antibiotikum), (b) Paracetamol (Analgetikum) und (c) Heparin (Antikoagulans) für pharmazeutische Produkte. Der Schwerpunkt der Analyse der medizinischen und pharmazeutischen GVCs unterscheidet sich, da sich die COVID-19-Pandemie auf die Produkte unterschiedlich auswirkte: Die meisten Länder in der EU waren Anfang 2020 mit Engpässen bei verschiedenen kritischen medizinischen Produkten konfrontiert. Dies hat zu negativen Auswirkungen auf PatientInnen und MitarbeiterInnen des Gesundheitswesens geführt. Im Gegensatz dazu waren COVID-19-induzierte Engpässe bei pharmazeutischen Produkten bisher - mit einigen wenigen Ausnahmen - selten und mit sehr begrenzten negativen Auswirkungen für PatientInnen. Die COVID-19-Pandemie hat jedoch bereits bestehende sowie potenzielle Vulnerabilitäten für verschiedene pharmazeutische Lieferketten in der EU aufgezeigt.

Der vorliegende Report diskutiert die gegenwärtige Struktur der globalen Kakao Wertschöpfungskette (KS-WSK). Er zeigt auf, dass sich die arbeitsintensive Produktion von Kakaobohnen stark auf Côte d'Ivoire und Ghana konzentriert, während die kapitalintensive Verarbeitung der Bohnen sowie die Herstellung von Schokolade insbesondere in Europa und den USA erfolgen. Nachdem staatliche und internationale Regulierungen des Kakaosektors in den kakaoproduzierenden Ländern ab den 1980er-Jahren zusehends zurückgedrängt wurden, waren die institutionellen Rahmenbedingungen der globalen KS-WSK in den letzten Jahrzehnten insbesondere durch industrielle Selbstregulierung geprägt. Gleichzeitig kam es zu einer verstärkten Thematisierung sozialer und ökologischer Herausforderungen in der Kette über das Thema Kinderarbeit hinaus. Hierauf wurde mit der Verbreitung unternehmenseigener Nachhaltigkeitsprogramme sowie gemeinsamen Unternehmensinitiativen, die unter anderem unter dem Zusammenschluss der World Cocoa Foundation (WCF) vorangetrieben wurden, reagiert. Zusätzlich stieg die Bedeutung von Zertifizierungsstandards. Dieser Report diskutiert welche Wirkungen die Maßnahmen zur Erhöhung der sozialen und ökologischen Nachhaltigkeit in der KS-WSK in den letzten zwei Jahrzehnten hatten. Er kommt dabei zu dem Ergebnis, dass bislang noch keine umfassenden Antworten auf die strukturellen Probleme in der globalen KS-WSK gefunden wurden. Der Report schließt mit dem Vorschlag, zivilgesellschaftliche Perspektiven und jene der Unternehmen zusammenzuführen. Die Einrichtung einer Kakaoplattform, wie sie in Deutschland und der Schweiz bereits besteht, könnte Initiativen zur Erhöhung der sozialen und ökologischen Nachhaltigkeit entwickeln.

This Briefing Paper examines the resilience of the medical product and pharmaceutical global value chains. Based on this assessment, policy recommendations are presented to increase supply security, including measures to improve the resilience of supply chains, and to expand stockpiling. We also highlight that industrial policy measures to promote reshoring should play a more important role, and that coordination on the EU-level is necessary. Given the large differences between products and supply chains within and between sectors, policies need to be tailored to specific products and product groups. Finally yet importantly, repercussions of EU policy on the Global South also need to be taken into account.

The promotion of sustainable value chains is on the rise in the EU, with important implications for textile and apparel (T&A) products. EU T&A supplier countries and firms will increasingly have to adapt to the new EU value chain and market dynamics. Based on a case study of the Egyptian T&A sector, this policy note argues that the required transformation of the industry will be highly demanding. EU development policy should increase support in order to promote sustainable value chains in the T&A sector in Egypt, but also in other MENA countries with export-oriented T&A sectors

Structural transformation and export diversification into higher value-added products and away from primary commodities remain major development objectives for low-income countries (LICs). Sectors such as apparel or leather products have traditionally been gateways to export diversification for LICs and are generally regarded as first steps for developing countries embarking on an export-oriented industrialization process. Given their rather low entry barriers (low fixed costs and relatively simple technology) and labor-intensive nature, the sectors can absorb large numbers of unskilled workers and provide upgrading opportunities into higher value added activities within and across sectors. However, the defining characteristics of these sectors also mean that they are very competitive, leaving many suppliers with limited leverage and challenges in ensuring social and environmental compliance and longer term development benefits. In Ethiopia, the objective to transform from the still dominant agricultural sector to the industrial sector is paramount in policies. Agricultural development led industrialization (ADLI) was developed as the main guiding principle of Ethiopia's development process. The underlying idea was that Ethiopia's manufacturing sector should complement the growth of the country's dominant agricultural economy, focusing on labor intensive and low-tech industries with linkages to the agricultural sector. One of the main priority sectors is the leather and leather product (LLP) sector given its direct links to agriculture through the livestock sector as well as its labor intensity, relatively simple technology and large export potential. Ethiopia has adopted an active, state driven industrial policy aimed at incentivizing exports, linking to global value chains (GVCs), attracting lead firms and foreign direct investment (FDI), supporting local firms, and creating local linkages to promote priority sectors. As a result, the Ethiopian LLP sector has experienced significant growth dynamics in production, employment and exports as well as upgrading processes in recent years. Despite many remaining constraints throughout the value chain that hamper growth in exports and the positioning of Ethiopia as a sustainable sourcing destination. Given the high potential of the sector, this report assesses the prospects for increased sourcing of leather and manufactured leather products from Ethiopia to the EU. The report provides a value chain analysis and presents the opportunities and challenges of the Ethiopian LLP sector in order to better assess the potentials for increased sourcing from Ethiopia as well as the interventions EU development cooperation agencies could promote in support of increased export competitiveness. The structure of the report is as follows: Chapter 2 gives a brief overview of the LLP GVC dynamics and recent developments. In chapter 3, we analyze the EU's LLP value chains by discussing different products, market segments and value chain dynamics as well as buyers' requirements. Chapter 4 gives an overview of the Austrian LLP sector and discusses its sourcing potentials for Ethiopian LLP. In chapter 5, the Ethiopian LLP sector's recent development and structure is analyzed. In chapter 6, the opportunities and challenges of Ethiopia's LLP sector are presented. Chapter 7 discusses possible areas of interventions and the potential contributions of European development cooperation agencies in promoting LLP exports. Given the high potential of the sector, this report assesses the prospects for increased sourcing of leather and manufactured leather products from Ethiopia to the EU. The report provides a value chain analysis and presents the opportunities and challenges of the Ethiopian LLP sector in order to better assess the potentials for increased sourcing from Ethiopia as well as the interventions EU development cooperation agencies could promote in support of increased export competitiveness. The structure of the report is as follows: Chapter 2 gives a brief overview of the LLP GVC dynamics and recent developments. In chapter 3, we analyze the EU's LLP value chains by discussing different products, market segments and value chain dynamics as well as buyers' requirements. Chapter 4 gives an overview of the Austrian LLP sector and discusses its sourcing potentials for Ethiopian LLP. In chapter 5, the Ethiopian LLP sector's recent development and structure is analyzed. In chapter 6, the opportunities and challenges of Ethiopia's LLP sector are presented. Chapter 7 discusses possible areas of interventions and the potential contributions of European development cooperation agencies in promoting LLP exports., This report has greatly profited from work undertaken by Rachel Alexander, Shamel Azmeh and Tewodros Yilma in the context of a related research project commissioned by CBI Netherlands. Our sincere thanks go to Ms Henrique Postma-Hazelaar, Ms Melanie van der Baaren-Haga and Ms Vera Geling (all CBI Netherlands) for providing generous organizational and financial support (the final report of that project can be found here). Ms Susanne Thiard Laforet and Ms Dina Sautter (both at Austrian Development Agency) provided valuable insights into the work of Austrian Development Cooperation in Ethiopia. Additional information on the Austrian leather industry was generously shared with us by Ms Barbara Withalm and Ms Eva Maria Strasser (Fachverband Textil-, Bekleidungs-, Schuh- und Lederindustrie, WKO). All remaining errors and omissions are the sole responsibility of the authors., {"references":["European Commission (2018): The Leather Industry in the EU. Brussels. https://ec.europa.eu/growth/sectors/fashion/leather/eu-industry_en (11/3/2019)."]}

The European Union (EU) promotes the Free Trade Agreement with Vietnam (EVFTA) as an important milestone of its trade agenda. The agreement, whose part with EU-only issues is supposed to be ratified in 2019, is the most comprehensive one that the EU has concluded with a developing country so far, including an ambitious sustainability chapter. The reciprocal liberalization of tariffs and quotas will benefit important Vietnamese export sectors such as textiles, apparel, and footwear. On the other side, agricultural and industrial sectors in Vietnam might face increased import competition. Other provisions in the agreement such as the adoption of international or EU standards might be associated with adjustment costs. Thus, it will be crucial for Vietnam to promote its export sectors with pro-active upgrading policies. Further, the provisions in the sustainability chapter will have to demonstrate that increased trade and investment are compatible with labour and environmental protection. Both issues require substantive support by the EU.

Commodity price volatility remains a crucial development challenge of commodity-dependent countries of the Global South. Drawing on structural development economics' concerns with commodity price volatility and stabilisation, this article calls for the integration of price-setting into the analysis of governance in global commodity chains (GCCs). It argues that price-setting power and related uneven exposure to price instability and risks adds to other power dimensions in producing unequal distributional outcomes in GCCs. The paper assesses national price stabilisation in the top cocoa-producing countries Côte d'Ivoire and Ghana against changing inter-firm governance and price-setting institutions in the cocoa GCC. Based on over 50 interviews with commodity trading houses (CTHs) and cocoa sector actors in Côte d'Ivoire and Ghana, our analysis shows that national-level price stabilisation mechanisms address intra-seasonal producer price volatility, but have few possibilities to shield export and producer prices from inter-seasonal price variations. This is because both countries remain 'global price takers' with global prices set on financialized derivatives markets and transmitted along the GCC by CTHs, which limits possibilities for 'domestic price making'. This leaves the major burden of price risks between seasons with smallholder producers that have the least possibilities to deal with these risks.

Political and scholarly debates on the potentials and constraints of inclusive and sustainable development in the global periphery are at the core of the developmental discourse. This paper argues that discussions on the effectiveness, inclusiveness and sustainability of economic development need to take the political economic contexts of specific peripheral countries into account. The paper highlights that the more recent literature related to the developmental state debate provides valuable insights to this end, but needs (i) further conceptual extension, in particular with respect to the role of social inclusion and hegemony, and (ii) operationalization in order to be useful from a policy perspective. This paper aims to add to these two gaps in the literature.

This paper contributes to debates regarding the lack of theorization of the state and the overemphasis on lead firms in studies of global value chains (GVCs) and global production networks (GPNs). This paper combines the GVC/GPN frameworks with a strategic-relational approach (SRA), a SRA conceptualization of the developmental state, and literature about the embeddedness of firms. Empirically, the paper analyzes the conflictual relationship between firms and the state's strategies that structure and re-structure the development, industrial policy regime, and GVC/GPN integration of the Ethiopian leather and leather products (LLP) industry.

This policy note presents policy recommendations for a sustainable development strategy for the Tunisian textile and apparel (T&A) sector in the context of the ongoing negotiations on the Deep and Comprehensive Free Trade Agreement (DCFTA) between Tunisia and the EU. Against the backdrop of economic crisis and decreasing apparel exports to the EU, support for the T&A industry could be an important way to help reinvigorate the economy. A sector development strategy should primarily focus on functional and product upgrading potentials, linkage development as well as on export market and product diversification.

The European Union (EU) has concluded or currently is in the process of concluding Economic Partnership Agreements (EPAs) with the group of African, Caribbean and Pacific (ACP) countries. Instead of the unilateral approach prevalent until the Lomé Agreements, the EPAs are bi-regional reciprocal agreements, which commit both parties. Unsurprisingly, the negotiations on the EPAs have thus proofed challenging and highly controversial. Given their political sensitivity, the EPAs must deliver tangible benefits to the African partners. Thus, the trade liberalization and further changes facilitated by the agreements must trigger sustainable economic development for the African partner countries, i.e. economic growth that is socially inclusive and respects ecological boundaries. EPAs are therefore primarily to be judged against this yardstick, which is the approach adopted in this study. Apart from assessing the impact of the EPAs and investigating export potentials, the study also aims at providing policy recommendations for EU Development Cooperation in the latter's efforts to support development-friendly implementation of the EPAs. The report starts with an assessment of the main provisions of the three EPAs covered - the South African Development Community EPA (SADC-EPA), the Economic Community of West African States EPA (ECOWAS-EPA) and the East African Community EPA (EAC-EPA), thereby focusing on the market access offer and the provisions in the agreement which potentially limit the developmental policy space as well as offer a potential to strengthen sustainability aspects in African partner countries. Then the implications of the three specific EPAs with a focus on Mozambique, Ghana and Uganda, respectively, are scrutinized. The respective analyses provide assessments of the economic impact of the three regional EPAs on Mozambique, Ghana and Uganda, based on simulations with the ÖFSE Global Trade Model. Based on interviews with stakeholders during field research in the three countries, implementation challenges associated with the agreements are discussed. Further, different sectoral case studies are analyzed to investigate the potential of the EPAs on the export side, highlighting the opportunities and challenges for export promotion policies in the context of global value chains and related lead firm strategies as well as local competitiveness conditions. The five sectoral case studies include the cotton, textile and apparel sectors in selected SADC countries with a focus on Mozambique, the cocoa and mango sectors in Ghana, and the coffee and fish sectors in Uganda. Final report, 12 July 2018

The EU has recently concluded or is currently in the process of negotiating a number of bilateral free trade agreements with both industrialized countries, e.g. Japan, and developing as well as developing and emerging economies. Negotiations with the latter group include Tunisia, where negotiations on the Deep and Comprehensive Free Trade Agreement (DCFTA) were formally launched in October 2015. Until July 2018, two negotiation rounds have taken place, the conclusion of the agreement is expected for 2019. Based on the EU trade strategy "Trade for All. Towards a more responsible trade and investment policy", published in October 2015, these so-called new generation bilateral trade agreements are deliberately designed as 'deep and comprehensive". In other words, while also targeting remaining traditional trade barriers, such as tariffs and quotas, above all they aim at tackling non-tariff measures that are deemed relevant for trade. As is also stressed by the EC, trade liberalization in the extended definition of the new EU trade agenda must promote sustainable development both in the EU and the partner countries, i.e. economic growth that is socially inclusive and respects ecological boundaries. In other words, adherence to the principle of policy coherence for sustainable development (PCSD), as recently defined by the UN Agenda 2030 for Sustainable Development and subsequently adopted by the new European Consensus on Development, is required. New generation FTAs are therefore primarily to be assessed against this yardstick, which is the approach adopted in this study with respect to the EU FTA with Tunisia (DCFTA). The report assesses the DCFTA between the EU and Tunisia, starting with an economic overview and an analysis of the trade patterns between the EU and Tunisia (Section 2). In the following section, the key contents of the FTAs are assessed (Section 3). This includes a detailed analysis of the market access offer and other key issues, as well as a discussion of the trade and sustainable development aspects of the respective agreement, and finally of EU development cooperation in the partner country. Section 4 analyzes the economic implications of the FTAs on Tunisia. The section starts with an assessment of the potential economic impacts of the agreement, based on simulations with the ÖFSE Global Trade Model. Based on interviews with stakeholders and field research in the partner country, negotiating concerns and implementation challenges associated with the agreement are detailed in the subsequent sections. Further, different sector case studies are analyzed in order to investigate the potential of the DCFTA on the export side, highlighting the opportunities and challenges for export promotion policies in the context of global value chains and related lead firm strategies as well as local competitiveness conditions. The sectoral case studies include the textile and apparel sector as well as the olive oil sector in Tunisia. Section 5 provides a summary of the main findings with respect to economic impacts, the sectoral case studies and the sustainability concerns. Upon that basis, key policy recommendations are proposed in the areas of adjustment assistance and productive development promotion. Final report, 12 July 2018

This policy note presents policy recommendations for a sustainable development strategy for the Tunisian olive oil sector in the context of the ongoing negotiations on the Deep and Comprehensive Free Trade Agreement (DCFTA) between Tunisia and the EU. Against the backdrop of increasing local value added and ecological constraints, a sector development strategy should primarily focus on exploiting functional and product upgrading potentials in the EU and other end markets instead of increasing low value bulk exports.

This policy note presents policy recommendations for a sustainable development strategy targeting the Ivorian and Ghanaian mango sectors. Based on a GVC and SWOT analysis, we conclude that the mango sectors in both countries yield significant potential for promoting socially inclusive and environmentally sustainable production and employment. To this end, in both countries, a stronger focus on industrial policies targeting the key challenges in the respective mango sector is however needed.

The European Union (EU) has recently concluded or is currently in the process of negotiating a number of bilateral free trade agreements with both industrialized countries, e.g. Canada and Japan, and developing as well as emerging economies. Negotiations with the latter group include inter alia the Mercosur countries, Vietnam, as well as the African countries of the African, Caribbean and Pacific (ACP) group and Tunisia. Negotiations on the EU-Tunisia Deep and Comprehensive Free Trade Agreement (DCFTA) were launched in 2015 and are still ongoing. Trade agreements between advanced and developing countries like those negotiated by the European Union and the ACP countries as well as with Tunisia, respectively, pose both opportunities and threats to the partner countries involved. While results from model-based economic impact assessments typically indicate that the macroeconomic effects of such agreements tend to be small, the long-term effects depend on the structural change triggered by the agreements. It is a well-known contention in the development economics literature that the marked differences in economic capacities and capabilities between advanced and developing economies pose particular problems that need to be dealt with, if longer-term impediments to late economic development are to be avoided. Thus, in this report, the focus is directed towards discussing the challenges of productive development as well as of export promotion in selected EU partner countries and export sectors in the context of trade liberalisation. To this end, four export sectors in three African countries are analysed, namely (i) the cocoa and mango sectors in Côte d'Ivoire and Ghana, and (ii) the olive oil and the textile and apparel sectors in Tunisia. With the exception of the mango sector, the other sectors - cocoa, olive oil and textile and apparel - are well-established sectors in the respective countries. Attempts to functionally upgrade into processing for the agriculture-based cocoa and olive oil sectors are however recent, while important consolidation processes have been under way in the context of increased global competition and political instability in the context of the Arab Spring in the textile and apparel sector in Tunisia. Mango exports have only recently become a thriving export sector in Côte d'Ivoire and Ghana and have profited from strong demand growth in advanced and increasingly also emerging countries. All sector case studies are located in African countries, which figure among the prioritized partner countries for EU development cooperation. For each scrutinized sector, key policy recommendations for upgrading and diversification into higher value-added products are proposed. Final report, 12 July 2018

The European Union (EU) and Tunisia launched negotiations on a Deep and Comprehensive Free Trade Area (DCFTA) in 2015. So far, progress has been limited. The enhanced integration of the Tunisian economy into the EU single market involves several controversial topics. Above and beyond the elimination of tariffs in sensitive agricultural sectors, these concern in particular the liberalization of trade in services, investment and public procurement. At the same time, the negotiations take place under challenging economic, political and social circumstances within the country and the MENA region, which call for a particularly prudent approach. Our assessment of expected economic impacts points to negative GDP effects and minor employment effects in Tunisia in the short to medium term in the case of full tariff liberalization and extensive harmonisation of the regulatory frameworks. Therefore, in the negotiations, the EU should prioritize short-term benefits for the Tunisian economy, mitigate adjustments costs and pro-actively support productive development and upgrading.

The EU has recently concluded or is currently in the process of negotiating a number of bilateral free trade agreements with both industrialized countries, e.g. Japan, and developing as well as emerging economies. Negotiations with the latter group also include Vietnam, where negotiations were formally concluded in December 2015. After completing the legal review of the text of the agreement, which is underway at the time of finalizing this report (July 2018), the agreement will then submitted to the Council of Ministers for approval. Based on the EU trade strategy "Trade for All. Towards a more responsible trade and investment policy", published in October 2015, these so-called new generation bilateral trade agreements are deliberately designed as 'deep and comprehensive". In other words, while also targeting remaining traditional trade barriers, such as tariffs and quotas, above all they aim at tackling non-tariff measures that are deemed relevant for trade. As is also stressed by the EC, trade liberalization in the extended definition of the new EU trade agenda must promote sustainable development both in the EU and the partner countries, i.e. economic growth that is socially inclusive and respects ecological boundaries. In other words, adherence to the principle of policy coherence for sustainable development (PCSD), as recently defined by the UN Agenda 2030 for Sustainable Development and subsequently adopted by the new European Consensus on Development, is required. New generation FTAs are therefore primarily to be assessed against this yardstick, which is the approach adopted in this study with respect to the EU FTA with Tunisia (DCFTA). The report assesses the EVFTA between the EU and Vietnam. The report starts with an economic overview and an analysis of the trade patterns between the EU and Vietnam (Section 2). In section 3, the key contents of the EVFTA are assessed. This includes a detailed analysis of the market access offer and other key issues, as well as a discussion of the trade and sustainable development aspects of the respective agreement, and finally of EU development cooperation in the partner country. Section 4 analyzes the economic implications of the EVFTA on Vietnam. The section starts with an assessment of the economic impacts of the agreement, based on simulations with the ÖFSE Global Trade Model. Based on interviews with stakeholders and field research in the partner country, negotiating concerns and implementation challenges associated with the agreement are detailed in the subsequent section. Further, sectoral case studies are analyzed in order to investigate the potential of the EVFTA on the export side, highlighting the opportunities and challenges for export promotion policies in the context of global value chains and related lead firm strategies as well as local competitiveness conditions. The sectoral case studies focus on the textile and apparel sector and the aquaculture sector with a focus on pangasius fish and shrimp. Section 5 provides a summary of the main findings with respect to economic impacts, the sectoral case studies and the sustainability concerns. Upon that basis, key policy recommendations are proposed in the areas of adjustment assistance and productive development promotion. Final report, 12 July 2018

The Economic Partnership Agreements (EPAs) between the EU and African, Caribbean and Pacific (ACP) countries mark a new era in the economic relations between both sides. Reciprocal tariff liberalization will however result in asymmetric market opening by ACP partners, which will entail negative, though small, macroeconomic effects for these countries in the short to medium term. In order to deliver upon the promised tangible benefits of EPAs in the longer term, the EU should implement strong policy responses in three key areas: (i) coping with adjustment costs, (ii) promoting productive development, and (iii) fostering trade-related institutional capacities in the public sector and civil society, including an effective monitoring process for EPA implementation.

The current negotiations on a transatlantic Free-Trade Agreement between the US and the EU (TTIP) have raised substantial public interest. Several studies have highlighted the positive economic effects of TTIP. A new ÖFSE report shows that these claims are overstated and neglect crucial adjustment costs and the social costs of regulatory change.

What are the economic effects of TTIP? In the public debate, a few selected studies, mostly commissioned by the European Commission, have set the tone, suggesting that effects are positive on both sides of the Atlantic. The studies are from Ecorys (2009), CEPR (2013), CEPII (2013) and Bertelsmann/ifo (2013). In this review, we critically assess these findings and their underlying methodologies. In addition, we discuss some issues, which are frequently neglected by trade impact assessments, but are nevertheless important from our point of view. In a nutshell, we see limited economic gains, but considerable downside risks.

Much of the current discussion about the Transatlantic Trade and Investment Partnership (TTIP) is focused on the potential welfare and employment effects. Supporters of TTIP often support their argument by highlighting the optimistic results of computable general equilibrium (CGE) models. CGE-models are the methodological backbone of most ex-ante impact assessments of free-trade agreements, as for instance published by the European Commission. The objective of this paper is to assess the accurateness of ex-ante studies by scrutinizing the example of the North American Free Trade Agreement (NAFTA). The analysis suggests that a considerable gap exists between ex-ante projections and ex-post evaluations with regard to NAFTA's effects on welfare, wages and employment. Most exante models had a tendency to overestimate the benefits and underestimate the costs of free-trade. The experience of NAFTA reveals the weak credibility of ex-ante simulations. Policy makers should thus treat the formers' results with the appropriate skepticism.