European countries, which became rich by seizing natural resources from their Colonial empires, are now engaged in a new resources grab using free-trade policies that undermine developing countries and lock them into a cycle of poverty.

This is the conclusion drawn in a compehensive new report on European Union trade policies written by Mark Curtis for a number of European charities and, ironically, funded by the EU.

The report, The New Resource Grab (pdf download available below) explains how the European Union is making a big push for access to cheap raw materials from developing countries using free trade agreements which remove trade barriers and set new rules on investment.

These EU policies constrain developing countries from promoting their own effective development policies and ensure countries suffer the 'already prevalent' negative human rights and environmental impacts of resource exploitation.

These trade policies are already having an adverse impact on developing countries and this situation is only likely to get worse, says the report.

At worst, the EU's strategy looks like a traditional grab for raw materials,.. that will lock developing countries into a vicious cycle of poverty.

The EU is urging countries to reduce export taxes, which are usually an extremely important revenue source, says the report.

The EU is also trying to deny developing countries the right to restrict foreign investment to promote their own development. This is despite the fact that most succesful developed countries used restrictions on foreign investment themeslves to promote their own development.

The EU wants its companies to be treated the same as local buusinesses in developing countries, wants those business to be protected by minimum standards that give them more rights than the host government or affected comunities and it wants the companies to enjoy free movement of capital so they can take their profits off-shore with no protection for the local economy.

If the EU succedes in negotiating more Economic Partnership Agreements, warns the report, then more rights will be handed over to foreign investors, increasing land alienation, deforestation, undermining farming opportnities and food security. They will also increase the negative environmental impacts of resource extraction and reduce government revenues - all at the expense of local people, communities and businesses.