Last week European and North African leaders met in Tunisia at the latest 5+5 Conference. This was immediately preceded by US Secretary of State Colin Powell’s whistle-stop tour of Tunisia, Morocco and Algeria.

The 5+5 Conference refers to five European and five North African countries. This was the first such conference at which all the heads of state of the 10 countries met—the presidents of Tunisia, Algeria and France, the prime ministers of Mauritania, Malta, Italy, Spain and Portugal, the king of Morocco, Colonel Gadhaffi of Libya, as well as the president of the European Commission and the secretary general of the Maghreb Arab Union which represents all five of the African States.

The 5+5 Conference was set up in 1990, but has hardly met since largely due to Libya being out in the cold. The ongoing dispute between France and Libya, concerning the downing of an airliner over Niger in 1989, was put on the back burner for this conference. Gadhaffi chose not to address the conference, however, saying somewhat cryptically that “Words are Silver, but Silence is Gold”.

The 5+5 Conference is a part of European efforts to bring North Africa entirely within its sphere of influence. President Jacques Chirac of France reaffirmed the Euro-Maghreb area as a strategic priority and promised that whilst the European Union (EU) expands eastwards “it will not turn away from its southern bank.”

The post-9/11 situation has seen increasing encroachment by the US into a region that the major European powers have long considered their sphere of influence. The EU is pushing for a Mediterranean Basin Initiative (MBI) by 2010, which will bind all of the Mediterranean countries to the EU in a trade bloc and as a source of cheap imports and cheap labour. Europe already has free trade agreements with several North African countries.

The main items on the agenda in Tunis were immigration and the perceived threat from terrorism. The EU’s position was that it welcomes immigrants, but not in conditions of “anarchy and indignity”. It pushed the African countries, particularly Morocco, to maintain stricter controls. The Africans pointed to the need for financial assistance from Europe to tackle the issue. Algerian President Bouteflika observed that it was also poverty and hopelessness that was driving young men in their countries into extremist groups. “We should not forget the need to control the underlying causes of terrorism,” he said.

Colin Powell visited the region immediately prior to the 5+5 Conference, and at short notice, in what would appear to be an attempt to say his piece before the conference began. He was ostensibly bolstering support for the US war on terrorism. A journalist asked him if this visit was a form of competition with Europe over the Maghreb. “No competition whatsoever,” he replied. “This was pure chance that my schedule permitted me to visit the Maghreb during this period... I am not in competition with the 5+5 group or the French.”

Powell arrived in Tunisia as the highest ranking US official to visit in a decade. He invited the Tunisian president to visit Washington during February 2004, and announced that the recent Trade and Investment Framework Agreement between the two countries will ultimately result in a Free Trade Agreement. He also announced plans for the US to open a regional office of the Middle East Partnership Initiative (MEPI) in Tunis next year. The MEPI is an attempt to create a region-wide trade agreement to rival the European MBI.

The Stratfor policy thinktank identifies the MEPI as making a direct challenge to the Europeans. Whilst it would have little impact in percentage terms to US trade, it would have a huge impact in each Middle East and African country. Better credit rating would allow them to draw in foreign investment and would also strengthen their hand in negotiations with the Europeans. Any free trade agreement would wrest small but significant amounts of trade from Europe, thereby reducing European economic and political influence in the region. The US is also able to offer more favourable terms as agriculture and labour are not as big a problem for the US as they are for the EU. The US can also negotiate deals faster than the unwieldy EU.

As well as any trade rivalry, the Mediterranean represents an important waterway for the US for the passage of both warships and oil tankers. It therefore requires friendly nations and ports of call on its southern shore.

Tensions over Morocco

After Tunisia Powell went to Morocco, a staunch US ally. He announced a massive increase in US aid, ostensibly as thanks to Morocco for its help in the war on terror. Military aid is to be doubled and economic aid is to be increased fourfold. He noted that free trade negotiations were progressing and hoped that they would be concluded by the end of the year. For this purpose a Moroccan delegation left immediately for Washington.

France has made its objections to these negotiations plain. Last January French Foreign Trade Minister Francois Loos chastised Morocco for seeking a free trade agreement with the US saying, “You cannot say you want a closer partnership with the EU, and at the same time sign a free-trade agreement with the US... You have to decide which one to choose.”

France is clearly concerned that it is losing influence in its former colony, and indeed throughout Africa, due to the intrusion of US economic might. Rabat must consider the French threat carefully, as the EU commands two thirds of Moroccan foreign trade. France alone has 40 percent of Moroccan exports and 30 percent of its imports, compared to just nine percent and six percent respectively for the US.

The latest round of US-Moroccan free trade negotiations had to be held in Geneva, rather than Rabat as planned, due to anti-US sentiment in the Moroccan capital. They focused on demands by US corporate lobbies for thoroughgoing legal reform in Morocco, particularly regarding investment laws and enforcement of intellectual property rights. US corporations are also demanding the removal of laws dictating the maximum level of foreign ownership of companies in certain sectors such as insurance, and the protection of confidential business information particularly in the pharmaceutical industry. The US also sees obstacles in the web of personal relations and influence peddling necessary to get business done. The key problem area, however, is in agriculture.

The Moroccan government made a plea for an incremental approach to liberalising the agricultural sector, such as exists in their Partnership Agreement with the EU. Morocco is a predominantly rural economy, with 47 percent of its population living in rural areas. Cereal crops account for 66 percent of its arable territory. The country is already facing a rural exodus, with an estimated 230,000 migrating to the cities. It is wary of the long-term effects of liberalising this sector as several years of low rainfall (1999-2002) have caused an economic and social malaise well beyond the countryside. They are looking for a phase in period of up to 10 years to soften the impact of agricultural liberalisation.

After Morocco Powell stopped briefly in oil-rich Algeria, long enough to praise its “exceptional cooperation in the war on terrorism”. Powell felt it necessary to touch down here as Algeria will become a temporary member of the UN Security Council in January and the US is always looking for allies on this body. Powell also sought to encourage Algeria to negotiate directly with Morocco in respect of the thorny issue of Western Sahara—a phosphate rich territory which has recently sold exploration rights to search for oil off its coast. “We believe this is the time for Morocco and Algeria to enter into serious discussions as to how to move forward,” he said.

Algeria’s position has been that Morocco should negotiate directly with the Polisario independence movement, which is backed by Algeria. Western Sahara also borders Algeria and effectively gives the latter direct access to the Atlantic Ocean.

The US is promoting the Baker Plan to resolve the Western Sahara issue. Put forward by the UN Secretary General’s Special Envoy James Baker, who is also a key member of President Bush’s administration, it calls for a period of four or five years of semiautonomy for Western Sahara, to be followed by a referendum in which residents would choose to stay semiautonomous, to become independent, or to be integrated fully into Morocco. Polisario has cautiously welcomed these proposals, but Morocco has completely rejected them.

In October, 14 Moroccan political parties rejected the plan as “a dangerous escalation in an artificial conflict”. They insisted that any plan that threatens “the reality” that Western Sahara is Moroccan territory is unacceptable. Morocco wants direct talks with Algeria and Powell’s suggesting this to Algeria appears to be a compromise in favour of Morocco.

Chirac recently came out in full “active support” of Morocco’s position, though Europe is far from united on this question. Spain has historically opposed Morocco and supported the independence of its former colony. The Baker Plan “is not dead”, declared Spanish Prime Minister Jose Maria Aznar recently. “The dead are dead, except in politics where they often return to life.”

Aznar is coming under growing domestic pressure to consolidate Spain’s position within the expanding EU by putting the immigration issue and external policy to the fore. At its closest point Spain is only 7.5 miles from Morocco and it is this stretch of water that most illegal immigrants risk their lives to cross.

Spain’s relationship with Morocco has not been good. Apart from the Western Sahara question, there are issues surrounding Spain’s enclaves of Ceuta and Melilla, the recent standoff over the islet of Perejil/Leila and also over fishing rights.

Following the 5+5 Conference, Spain met with Morocco in bilateral talks seeking a rapprochement with its southern neighbour. The thorny issues were kept off the agenda, with the talks focusing primarily on immigration. The two countries announced that they will be undertaking joint immigration controls as from January, and pledged to tackle the people-smuggling mafias.

The key outcome of the talks, however, was a package of soft loans and debt swaps amounting to 390 million euros, which Spain has granted to Morocco. This is the largest financial package ever granted by Spain to any nation. It aims to create jobs and housing and to stem the flow of illegal immigrants to Europe.