Bridges Weekly Trade News Digest • Volume 13 • Number 23 • 24th June 2009

EU, West Africa Push EPA Deadline from June to October

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June will come and go without the expected conclusion to trade talks between the European Union and a group of West African countries, the parties said after meeting in Brussels last week. Instead, the parties now expect to sign an economic partnership agreement (EPA) in October.

“Nigeria along with other major regional stakeholder nations such as Ghana, Côte d’Ivoire and Senegal had a meeting and looked at the entirety of the hurdles that need to be scaled to conclude the EPA and at the end it was clear that we cannot finish all the outstanding tasks before the June 30 deadline,” said Ken Ukaoha, Nigeria’s top trade official, according to a report in his home country’s This Day newspaper.

The announcement came after a 17 June meeting between EU Trade Commissioner Catherine Ashton, West African commerce ministers, as well as leaders of the Economic Community of West African States (ECOWAS) and the Economic and Monetary Union of West Africa (UEMOA).

The October agreement is expected to cover trade in goods, development co-operation, and some trade rules, according to a joint statement. At a meeting earlier this month in Cotonou, Benin, the negotiators reached compromises on export taxes, free circulation, and development issues.

Negotiators were pleased that they had made progress despite the setbacks, according to the European Commission. “Our latest meeting is a clear sign that we are back on track - making steady progress with our West African partners,” said EU Commissioner for Development and Humanitarian Aid Louis Michel, who stressed that their ultimate objective continues to be the negotiation of a full-fledged EPA.

But the deal could still be tripped up by a few critical issues. The parties remain at a standstill on the EU’s ‘Most Favoured Nation’ status, as well as the non-execution clause and financing for the ‘EPA Programme for Development’ (PAPED).

In West Africa, the deal will have the biggest impact in Nigeria, whose oil exports alone account for more than half of all of the region’s exports to the EU. Nigeria is currently entitled to export oil to the EU duty-free under the Generalised System of Preferences. Thirteen of the 16 ECOWAS member states have Least Developed Country status, which entitles all of their exports except weapons to enter the EU duty- and quota-free under the ‘Everything but Arms’ initiative.

The prospect of an EPA is somewhat complicated by trade agreements previously signed between the EU and individual West African states. Ghana penned an interim EPA with the EU in July 2008, and Côte D’Ivoire followed suit in November. Some provisions of the Ghanaian and Ivoirian deals are being re-negotiated by ECOWAS or have been rejected other members (see Trade Negotiations Insights, June 2009, http://ictsd.net/i/news/tni/47684/). It is unclear whether the EU will seek to re-work these provisions or offer concessions in order to close the deal with the regional group. An EPA between the EU and ECOWAS would supersede the interim EPAs with Ghana and Côte D’Ivoire.

But some observers have argued that if Ghana and Côte D’Ivoire individually pursue permanent EPAs, the result could distort efforts at regional integration by undermining the authority of ECOWAS and UEMOA. Some civil society members think regional integration should take precedence over trade deals with the EU.

According to Kwabena Nyarko Otoo of Ghana’s Trades Union Congress, his country would be better off if it put as much effort into penetrating the ECOWAS market as it is doing to access the EU. “Unfortunately, all our attempts are geared towards the EU market, instead of the ECOWAS market where demand for our products exists,” he told news agency Graphic Ghana.

ICTSD reporting; “Don’t sign economic pact with EU,” GRAPHIC GHANA, 18 June 2009; “EPA: EU bows to pressures, moves deadline,” THIS DAY, 22 June 2009.