International Regulation of Export Taxes: Development Tools or Inefficient Trade Instruments?

Export taxes are commonly imposed by commodity producers, most of whom are developing countries, in order to promote the development of downstream processing industries, to encourage foreign direct investments, to stabilise export earnings, but also to protect natural resources and the environment. Besides, export taxes are a major source of government revenue in developing countries. Export taxes do not seem to be prohibited in the WTO and any attempt to regulate them during the Doha Development Round has met with strong opposition by developing countries. The situation is actually rather different in the framework of regional trade agreements being negotiated by the European Union with developing countries. In particular, the European Partnership Agreements contain provisions whereby ACP State(s) shall not introduce new export taxes or increase those already applied. EPAs also provide for the possibility to introduce temporary export taxes in exceptional circumstances. The analysis of the regime of export taxes applied in regional trade agreements with developing countries can provide a different perspective to discuss questions (such as the policy space for development, the special and differential treatment, the relationship between regional and multilateral system, the tension between trade and industrial interests and the commitment towards developing countries) which are usually debated with reference to the more classical market access issue