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ACP-EU Joint Parliamentary Assembly debates draft report on EPAs
Debate over a draft report on Economic Partnership Agreements (EPAs) and their potential impact on the African, Caribbean and Pacific (ACP) states (1) ensued at the ACP-European Union (EU) Joint Parliamentary Assembly’s (JPA) Economic Development, Finance and Trade Committee meeting on 11 February 2009. (2) Disparagement of the report came from several Members of the European Parliament (MEPs) who claimed it is identical to the resolution on the development impact of the EPAs, adopted by the European Parliament (EP) on 5 February 2009. That resolution came following fundamental differences in approaches between the Parliament’s International Trade and Development Committees, an alliance of Christian Democrats and Liberals supporting the resolution, and political parties of the left that voted against the initial text. The left accused the right in the EP of “ganging up on the poorest countries,” pushing them to conclude dubious trade agreements that would open up their economies to EU exports. (3) This division does not augur well for those MEPs that want to delay the European Parliament’s assent—required for the EPAs to enter into force—until after ACP parliaments have ratified the EPAs.
European Trade Commissioner holds informal EPA discussions with key ACP Ministers
Ministers representing ACP regions outlined their positions on the contentious issues that need to be effectively addressed in the EPA negotiations to realise the agreements’ development dimensions (in relation to scope, sequencing, policy space, and financial support), in an informal meeting with EU Trade Commissioner, Catherine Ashton on 27 January 2009. The Commissioner stressed the need for maximum flexibility to find sustainable solutions to problems encountered in the negotiations. She indicated that the European Commission would re-examine its proposed Most Favoured Nation (MFN) clause in the EPA. ACP Ministers stressed that the Commissioner’s political will must to be translated into action in EPA technical level negotiations. All participants agreed on the need to monitor EPA implementation.
African Union calls for regional stakeholder involvement in implementation and monitoring (4)
Increased involvement of Regional Economic Communities and other stakeholders in the implementation and monitoring processes of the African-EU dialogue was called for during the African Union Summit on 26 January—3 February 2009. Heads of state further requested the AU Commission to submit a special report to each Session of the Executive Council on the progress made in the implementation of the African Union’s partnership with the European Union elaborated in the Joint Africa-EU Strategy.
Central Africa and European Commission resume EPA negotiations
Persistent, fundamental divergences on how to deal with key development, trade liberalisation and trade-related issues (TRI) may have to be resolved at the political level following the European Commission and Central African technical and senior officials EPA negotiating round on 2-10 February 2009. For more information on thess issues, please see the separate articles on this meeting in this edition of TNI.
West Africa finalising regional and EPA Development Programmes
The regional validation process for the West African Community Development Programme and the EPA Development Programme (5) was launched at a regional workshop on 2-4 February 2009. Participants agreed on a road map to elaborate the programmes in line with strategic national and regional frameworks. The plan focusses on food security, agri-food, textiles, tourism, private sector development, research, technological innovation, and natural resources.
Participants felt the EPA Development Programme’s estimated 9.5 billion Euro was insufficient as it does not represent the total cost of all EPA measures necessary and it focusses only on the priorities of the first five years of the EPA. Officials also re-affirmed the necessity to include precise commitments in the EPA on the implementation of the EPA Development Programme. It was agreed that governments must contribute to financing the programmes with support of international donors.
At a meeting of the West Africa Common External Tariff (CET) Management Committee, officials called on the regional commissions to find a way to maintain WTO-compatible tariff liberalisation exclusions that will allow sources of finance to be maintained in the CET and EPA. They also raised concerns, inter alia, with regard to the European Commission’s EPA proposals for MFN, non-execution clause, export subsidies, rules of origin, and technical barriers to trade. The meeting was held from 2-6 February 2009.
ESA Ministers prepare for talks with the European Commission on contentious issues
Eastern and Southern Africa (ESA) Trade Ministers considered possible options to advance EPA negotiations on contentious issues presented in a report prepared by the 20 January 2009 ESA Ministerial Task Force (6) during a meeting on 9 February 2009. (7) The Ministers maintained that special and differential treatment to allow leastdeveloped countries (LDCs) to offer less than the European Commission’s proposed 80% trade liberalisation and longer than fifteen years transition to protect tariff revenues and prepare for increased competition is WTO- compatible based on past precedent. This would enable all ESA states to submit market access offers acceptable to both parties and enable all LDCs to be part of a regional EPA that supports regional integration processes.
Ministers also maintained that the region’s ability to introduce new export taxes or quantitative restrictions provides critical policy space to pursue development objectives. They argued that the European Commission’s proposal to prohibit the use of new taxes and restrictions after the EPA is signed should be dropped since it is not required for WTO-compatibility.
Ministers continued to object to the European Commission’s proposed MFN clause that would limit the scope of any ESA country to sign an ambitious trade agreement with its major trading partners where the margin of preference that ESA countries are likely to obtain is higher than what they have obtained under the EPA. They also maintained that there is a necessity for flexibility in modifying tariffs in line with the evolution of the regional integration programme; this too, they noted, is WTOcompatible. Furthermore, improved asymmetrical rules of origin must allow unconditional cumulation with all ACP, and outermost regions, and neighbouring countries, according to the Ministers.
ESA ministers are also seeking a clear, joint understanding and legal commitment on more development resources for specific development assistance, along with support for EPA adjustment costs and implementation. ESA insists on using the COMESA Fund for financing. It was argued that a costed and prioritised development matrix to support EPA implementation should be included in the EPA and trade liberalisation should be linked to reaching some development benchmarks.
EAC increases efforts for effective regional integration
Recommendations to move beyond purely national interests and build on the demonstrated strengths of established institutions were adopted at a high level retreat of EAC institutions, the Secretariat, the East African Legislative Assembly and the East African Court of Justice on 9-10 February 2009. (8) Civil society and private sector representatives also participated in the meeting. The recommendations also call for prioritisation of the regional integration agenda within national agendas for enhanced integration, removal of barriers to trade, increased investment promotion, movement of people, goods and labour, and to bolster employment opportunities. The proposals adopted would require deliberate efforts by EAC Member States, institutions, civil society, and the private sector.
In other regional news, an East African Joint Trade Commission will be established to harmonise trade policies, develop an East African Trade Regime, and conduct trade negotiations on behalf of the EAC Member States as agreed at the end of January. (9)
European Commission showing flexibility in SADC EPA negotiations European Trade Commissioner Catherine Ashton agreed to put the imminent signature of the Southern African Development Community (SADC) interim EPA on hold pending the outcome of a Joint European Commission-SADC senior official two-day meeting scheduled for the week of 9 March 2009. This followed her bi-lateral meetings with South African and Botswana Foreign and Trade Ministers and a joint meeting with Angolan, Namibian, and South African (ANSA) Ministers on 9-10 February 2009. During these meetings, discussions focussed on ANSA concerns, (10) outstanding tariff negotiations, and how to reach a harmonised relationship between SADC and the EU so as not to undermine regional integration. Commissioner Ashton also acknowledged concerns related not only to regional integration, but developmental policy space as well. She stressed the importance of finding ways to keep everyone on-board in the SADC IEPA process.
Now, European Commission technical officials must translate political statements of goodwill into concrete compromises and resolutions on contentious issues at the March 2009 meeting. The ANSA has argued that technical solutions are available to help solve the contentious issues since these issues do not relate to an area essential for WTO-compliance.
There remains, however, scepticism in the region based on a 21 January 2009 European Commission ‘non-paper’, which claimed that adjustments can only take place in the context of the negotiations for a full EPA and that reopening the negotiations for the IEPA is not a practicable approach.
Commissioner Ashton emphasised that the process cannot drag on much longer as the current status quo is unsustainable because it is subject to WTO challenge and also because some SADC EPA countries are eager to sign the EPA. If negotiators cannot agree, discussions will have to be pursued at the political level.
Caribbean divisions hindering EPA implementation
Divisions over the process of regional integration resulted in the postponement of the January 2009 meetings of the Caribbean Community and Common Market (CARICOM) Single Market and Economy (CSME) Prime Ministerial Sub-Committee. The meeting was set to discuss the faltering single market and a Special Committee of CARICOM Heads of State and Government was scheduled to evaluate the management and governance of the Caribbean Regional Negotiating Machinery (CRNM). (11) “The question is whether [the postponements] will provide the opportunity for more sober reflections or, as feared by some, whether it will deepen divisions and sour relations that could prove quite harmful to the future of CARICOM,” said regional analyst Rickey Singh. (12)
Progress in establishing a window within the Caribbean Development Fund (CDF) to channel and mobilise development support resources from Europe to CARIFORUM member states in accordance with the CARIFORUM-EC EPA was the focus of discussion during the Caribbean Council for Finance and Planning (COFAP) Meeting of Officials on 27-29 January 2009. (13) Disbursement flows from EPA-related financial instruments will be kept separate from other instruments of the CDF intended to specifically assist the development of CARICOM. (14)
In related news, European Commission Development and Trade officials meeting with CARIFORUM Secretary General, Edwin Carrington, on 13 February 2009 made it clear that funding for an EPA implementation unit would be forthcoming only if it included all CARIFORUM Member States.
The European Commission also undertook a mission in January 2009 to Haiti with a view to facilitating Haiti’s accession to the Cariforum-European Commission EPA.
Pacific awaits European response to EPA proposals
Pacific ACP (PACPs) countries sent the European Commission detailed proposals in a number of areas following on from the September 2008 technical level discussions. The European Commission has relayed some responses, including a proposal for PACPs to assume detailed obligations in Intellectual Property Rights and Government Procurement, which the PACPs have thus far declined to consider for the foreseeable future. The PACPs seek to agree an EPA as the basis on which a long-term partnership can be developed, with deepening legal obligations assumed by the PACPs over time as their capacities increase.
For a longer version of the EPA update, please see: www.acp-eu-trade.org/newsletter/tni.php
Author
Melissa Julian is Knowledge Management Officer at ECDPM.
Notes
1. Draft report on the Economic Partnership Agreements and their potential impact on the African, Caribbean and Pacific States, ACP-EU Joint Parliamentary Assembly, 11 February 2009, www.europarl.europa.eu/intcoop/acp/91_01/econ_09feb_en.htm.
2. Resolution on the development impact of the EPAs, European Parliament, 5 February 2009, www.europarl.europa.eu/sides/getDoc.do?pubRef=-//EP//TEXT+TA+P6-TA-2009-0051+0+DOC+XML+V0//EN&language=EN.
3. Conservative MEPs “ganging up on the poorest countries,” European Socialist Members of the European Parliament, 4 February 2009, www.socialistgroup.eu/gpes/newsdetail.do?lg=en&id=116681&href=home.
4. Summary of African Union Summit Decisions on Africa-EU Dialogue, 3 February 2009,
europafrica.org/2009/02/11/summary-of-au-summit-decisions-on-africa-eu-dialogue.
5. Mise à jour sur les négociations dans le cadre de l’APE Afrique de l’Ouest–UE, Hub Rural 11 February 2009, www.hubrural.org/spip.php?article290.
6. ESA EPA core group of Ministers discussed contentious issues 20.01.09 about.comesa.int/attachments/080_e-COMESA_newsletter_188.pdf.
7. ESA Trade Ministers results, COMESA press release, 9 February 2009, www.comesa.int/lang-en/component/content/article/34-general-news/75-esa-trade-ministers-meet-on-epas
8. EAC High Level Meeting Conclusions, 9-10 February 2009, www.eac.int/the-news/226-summit-chair- convenes-historic-meeting-to-usher-qnew-lookq-eac.html.
9. East African Joint Trade Commission to be established, 23 January 2009 www.tralac.org/cgi-bin/giga.cgi?cmd=cause_dir_news_item&cause_id=1694&news_id=58949&cat_id=1026.
10. ANSA concerns, 7 January 2009, www.acp-eu-trade.org/library/library_detail.php?doc_ language=en&library_detail_id=4888.
11. Caribbean Prime Ministerial Sub-Committee on CARICOM Single Market and Economy. 30.01.09 Focus on establishment of CARICOM Single Economy, Development Fund, EPAs. www.caricom.org/jsp/ pressreleases/pres14_09.jsp.
12. Threatening divisions in Caricom, Rickey Singh, 28 January 2009, www.trinidadexpress.com/index.pl/ article_opinion?id=161430912.
13. The Caribbean Council for Finance and Planning Meeting of Officials. Results. 27-29.01.09 www.dgroups.org/groups/CoOL/index.cfm?op=dsp_resource_details&resource_id=52276&cat_id=6364. 14. COFAP also discussed progress attained in devising a window within the Caribbean Development Fund (CDF) to channel and mobilise development support resources from Europe to CARIFORUM member states in accordance with the CARIFORUM-EC Economic Partnership Agreement (EPA). See: new.crnm.org/ index.php?option=com_content&view=article&id=366:rnm-update-0901&catid=59:rnmupdates&Itemid=128.
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