EPAs dominate EU-ACP Parliament talks
The controversial nature of the EPAs dominated the agenda of the EU–ACP Joint Parliamentary Assembly (JPA) held in Ljubljana, Slovenia on March 17-20. MEPs and ACP Parliamentarians voiced discontent over the last-minute nature of the deals and the subsequent impact on regional integration and development.
“Conflict and contention has mired the whole EPA process”, MEP Glenys Kinnock, co-President of the ACP-EU JPA, said in her opening speech. “With the exception of the Caribbean, the agreements were scaled back, and WTO-compatible interim deals were made, mainly on trade in goods, and signed in haste,” she said.1 “Regionalism is a key component of a progressive development strategy, and yet the Commission’s policy of concluding separate deals with individual states, or groups of countries, has splintered ACP regions,” she added.2 Wilkie Rasmussen, JPA co-President representing the Cook Islands, noted that some ACP countries were “unsure” about the EPA negotiating process, and felt that it might have implications for the flow of EU development funding. Rasmussen highlighted the difficulties of negotiating EPAs with the Commission, pointing out its lack of regard for cultural sensitivities.3
EU Development Commissioner Louis Michel rebuffed the criticism and despite a generous welcome from the JPA assembly, refused to budge on the EU Council’s position that the initialled EPA’s must be concluded by the end of 2008. “I do not accept these excuses,” he said. “If [ACP Countries] really want to profit from globalisation, they have no choice.”4 The JPA’s next meeting will be held in Port Moresby, Papua New Guinea from November 22-28, not long before the new December deadline for EPA signatures.
European Commission to examine regional integration
The European Commission launched a public consultation in March, for the preparation of a Communication on Regional Integration for Development in ACP Countries, due to be published in September.5 Development Director General, Stefano Manservisi, said that the purpose of the Communication was to reach a common understanding on the controversial issue and formulate a strategy. Speaking at the European Parliament Development Committee on March 3, Manservisi said there was a need to look at the role EPAs could play in this plan. The EPA may provide commercial or development benefits, he said, but would not bring about regional integration. Instead, the EPA must become part of the regional integration process already underway.
Manservisi claimed that under this new scheme, the European Commission is aiming to establish joint strategies with EU member states - including joint funding and programming - for the first time. Funding would preferably be provided through regional level budget support via EPA funds (to which the European Commission, member states and other donors could contribute). According to several sources, many believe that DG Development should focus on implementation of the EPAs and speeding up the 10th EDF programming before turning its attention to the Regional Integration Communication.
Central Africa finalises interim EPA text
Central Africa put the finishing touches to its interim EPA with the European Commission, during meetings between the two parties in Brussels from March 10-12. Following an examination of the December 2007 text and substantial subsequent corrections, the Commission claims that “this text is now final and will be used by both parties in the process leading to signature and ratification.”6 The document sets out objectives and a ‘way forward’ for a development partnership, a trade regime for goods, services and trade related rules. However, there is disagreement within the region on whether to negotiate services as to date, there has been no regional impact study in this area.
Sources indicate that despite the Commission billing the meeting as ‘full’ Central African reunion, not all member states were either invited or attended. Moreover, discontent was also voiced that the meeting completely bypassed the formal negotiation committee that existed until last year.
ECOWAS sets June deadline for CET
The urgency for West Africa to agree an EPA with the European Commission has forced ECOWAS to try to set its Common External Tariff (CET) by June 30. ECOWAS, which claims it is politically committed to negotiating a full EPA by mid-2009 or earlier, will base the CET on that of UEMOA – the West African Economic and Monetary Union. However, the issue remains controversial. The UEMOA CET contains four tariff bands: 0%, 5%, 10% and 20%, while Nigeria is pushing for an additional fifth band of 50% largely to help protect its pharmaceutical industry.
According to the National Association of Nigerian Traders (NANTS), the UEMOA tariff rates would not protect Nigeria’s “young and aspiring economy with her prospects and plans for industrialisation.”7 This call for a fifth band has gained support of the private sector and civil society organisations in West Africa.
Meanwhile, the European Commission and West African negotiators (ECOWAS and UEMOA Commissions) established the working calendar of regional EPA negotiations for 2008, during a meeting in Ouagadougou on March 3-6. The two sides will meet again in April and June 2008 to make progress ahead of the ECOWAS Heads of States summit on June 16. West Africa is developing a regional market access offer which it aims to finish in May. It is also working on a draft EPA text with a view to negotiate some chapters in April.
EU refuses to renegotiate ESAs interim EPA
The European Commission has this month stoutly refused to renegotiate some clauses of the EPA agreed with the ESA, despite calls from the latter to do so. According to sources present at an ESA-EU trade ministerial in Lusaka on March 3, ESA asked to re-visit the ‘Standstill clause’ and look at the issue of export taxes. ESA also wanted a flexible definition of ‘substantially all trade’ for LDCs’ and an identical MFN clause to that which was agreed with Cariforum. The ‘Standstill clause’ (Article 13) is particularly strict for ESA and EAC countries as it freezes tariffs on all trade between the two parties, whether or not products are subject to liberalisation. Thus, even if a product is on the ‘exclusion list’, the tariff cannot be raised after the EPA enters into force.
“The process leading to the interim EPA has not been easy for anyone,” EU Trade Commissioner Peter Mandelson told journalists after the Lusaka meeting. “It has required courage and leadership from those countries to have tabled market access offers compatible with multilateral trade rules. We designed and agreed the EPA together. We now need to move quickly to sign implement and defend this agreement together,” he said.
Belonging to more than one trade block is acceptable and workable, according to the director for investment promotion and private sector development at the Common Market for Eastern and Southern Africa (COMESA) Chungu Mwila on March 12. Acknowledging the conflict between regional trading blocks in Eastern and Southern Africa, Mwila said the next logical step was a COMESA Customs Union and CET. “I can confirm that, already there is a tripartite taskforce of the EAC, SADC and COMESA working on how best to harmonise the three trade regimes,” he said. “We are also mindful of a bigger vision of an African Common Market. Although we would like to strengthen the regional trading blocs, the broader vision is that they should fit into the grand plan of an African common market”, Mwila added.8
The ESA negotiating structure has recently changed, with the work programme now being negotiated by 16 ESA countries (including the EAC). The Regional Negotiating Forum is being replaced by ESA senior officials, while lead ambassadors will be replaced by an ESA negotiating team which will report to ESA ministers.
Commission urges SADC to conclude EPA
EU Trade Commissioner Peter Mandelson urged SADC to conclude a full EPA by the end of 2008, during a SADC-European Commission ministerial in Gaborone in the first week of March. Despite calls from some in the region to look at the MFN clause and the right to impose export taxes, Mandelson ruled out any re-negotiation of the agreement and said implementation would go ahead. “I am prepared to be flexible, on the basis that we move forwards and not backwards,” Mandelson insisted. “There is no way of reopening the process that has already been negotiated,” he said.9
Angola underlined the importance of remaining a part of the EPA process, claiming it intended to accede to the full EPA once the agreement has been concluded. SADC EPA countries agreed to work towards applying the interim agreement from July 2008 and the conclusion of a full EPA by the end of December.
The Southern African region faces a complex process of transformation, Botswana trade minister Neo Moroka claimed in March. Speaking at the ministerial in Gaborone, Moroka said the changes could rival anything Europe had ever experienced. Moroka added that trade remained a key factor for integration and poverty eradication in the region and central to this was the setting up of a SADC free trade area in 2008, a Customs Union by 2010 and a SADC Common Market by 2015. This timeframe is seen by many as overambitious.
Caribbean to complete EPA legal review by June
Caribbean heads of government committed to complete their internal review process in a timely manner so that the comprehensive EPA can be signed and provisionally applied by June 30 2008. It is hoped that this decision, taken in Nassau on March 7-8, will limit the delay in signing the EPA – originally scheduled for April – and avoid the risk of major economic dislocation within Cariforum.
Heads of government also decided during the meeting to form a committee, led by Jamaica and including Trinidad, Barbados, Guyana, Antigua, Grenada and the CRNM to look at the question of governance during trade negotiations and see where improvements could be made. Topics for consideration will include whether the CRNM should be under the control of Caricom and how it can relate to trade ministers given that it is a non-treaty based institution.
Pacific trade ministers join forces on EPA
Pacific ACP trade ministers have agreed to proceed as a group with negotiations of a comprehensive EPA by the end of the year. The commitment for the region to proceed collectively was reached after the two-day meeting in Nadi on March 26-28. However, Fiji and Papua New Guinea are still finalising the legal texts of the interim EPAs and the process to ratify the agreements remains unclear. Many are demanding a parliamentary process that would allow for substantial public scrutiny.
During the Nadi meeting, ministers considered the Pacific Island Countries Trade Agreement (PICTA), services, negotiations and issues relevant to the possible deepening of trade and economic co-operation between Forum Island countries and big brothers Australia and New Zealand. These two countries have been arguing for some time that the Pacific’s EPA negotiations have ‘pulled the PACER trigger’, i.e. that the region should now also begin negotiations with them. New Zealand’s trade minister Phil Goff scheduled an informal meeting of senior officials from PICs on the Pacific Agreement on Closer Economic Relations in Rotorua on April 7-11. However, there are indications this meeting might be delayed for several months due to packed agendas and a desire by Australia and New Zealand not to start talks off on the wrong foot by pressing for a meeting too soon.
For more EPA news please visit: www.acp-eu-trade.org/epa and www.ecdpm.org/epa
1 See: Economic Partnerships remain contested at ACP-EU talks, EUX.TV, March 18 2008. www.eux.tv/article.aspx?articleId=19955
2 Text of Kinnock’s address, www.europarl.europa.eu/intcoop/acp/60_15/pdf/kinnock_en.pdf
3 Text of Rasmussen’s address, www.europarl.europa.eu/intcoop/acp/60_15/pdf/rasmussen_en.pdf
4 See: Michel on EPAS: ‘I do not accept these excuses’ EUX.TV, March 18, 2008. www.eux.tv/Article.aspx?articleId=19956
5 To contribute to the consultation, see European Commission Development website: www.ec.europa.eu/development/index_en.cfm
6 For access to the documents, see: Accord d’Etape vers un APE entre l’UE et la partie Afrique Centrale, March 12 2008. www.ec.europa.eu/trade/issues/bilateral/regions/acp/epa_centafr_en.htm
7 See: ECOWAS CET: The imperatives of Nigeria’s fifth band, Ken Ukaoha, NANTS, March 10 2008. www.dgroups.org
8 See: Uganda: aim to harmonise trade regimes, Peter Kaujju, March 14 2008. www.tralac.org
9 See: Mandelson urges SADC to conclude EPA, Botswana Sunday Standard, March 30 2008.