International Trade. AfterWorld War 11the developed countries were badly in need of resources in Africa, the

After World War 11 the developed countries were badly in need of resources in Africa, the

Caribbean and the Pacific (ACP states). The measures were taken for mutually beneficial trade.

Lome Convention signed in 1975 at Lome, the capital of Togo, was one of those measures. It

w a s signed by forty-six ACP states and by members of the then European Economic Community

(EEC). It replaced previous association agreements made by the original six members of the

EEC with former colonies (Yaounde Convention) and the East African Community (Arusha

Agreement). (The East African Community was a common market of Uganda, Kenya and Tanz

ania.) Under the Lome Convention, all ACP industrial exports, and most agricultural exports,

to the EEC are free of duty. Financial and technical aid including an export income stabilization

sche те, called Stabex, for agricultural exports — was also agreed upon, and the European Devel

opment Fund was set up by the EEC to administer and channel aid funds to the Lome coun In

1979 a second agreement was signed, a third in 1984 and the fourth in 1990. The Lome IV

agreement was for a period of ten years. Within the first five years, the EC* made available to the

ACP countries a total of ECU 10,8 billion of aid through the European Development Fund and a

total of ECU 1,2 billion of low-interest loans through the European Investment Bank (soft loan).

Lome IV improved access to the European Union markets for some ACP agricultural products,

increased the funds available for Stabex, and widened its application to include exports to third

markets. The new agreement also allowed for assistance for broad economic structural adjustment

programmes, in addition to aid for specific investment projects. A mid-term Review in 1995 increased

the total funds available for ACP/EC cooperation to ECU 14,6 billion during the second

five-year term of the Agreement. In 1997, South Africa was negotiating admission as the Convent

on's eighty-sixth member.