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New EU Trade Commissioner to detail EPA approach in coming weeks
Karel De Gucht assumed office as the new EU Trade Commissioner on 9 February following a confirmation vote by the European Parliament[i]. ACP governments are pleased to have a political counterpart to help move the Economic Partnership Agreement (EPA) negotiations forward. For the past two months, an interim commissioner has held the post following the early resignation of the former trade commissioner, Catherine Ashton. De Gucht has pledged to take an “open and flexible approach” to the EPA negotiations and said concluding the EPAs with the ACP countries should be a top priority for the EU.
Central Africa agrees to continue EPA negotiations with the EU
Central African Heads of State agreed on 17 January to work towards concluding a regional EPA that addresses development needs and facilitates the integration of the region into the world economy.[ii]
A regional ministerial-level meeting to discuss EPAs is scheduled to be held in the second half of February in Douala. National Authorising Officers will also attend. The meeting will discuss outstanding EPA issues (market access, services, fiscal impacts of the EPA, the non-execution clause, import taxes, the MFN clause and development finance) and determine the strategy for negotiations with the EC. The EPA Regional Fund should also be discussed at this meeting. Another issue on the agenda is EC-Equatorial Guinea cooperation, and in particular Equatorial Guinea’s decision to not join the EPA before 2020. Ministerial and technical-level negotiations with the EC may then be held in the second half of March in Central Africa. A new calendar of meetings will be agreed at that joint meeting.
The implementation of the Cameroon-EU interim EPA continues to be delayed more than two years after it was signed, according to reports from the 25 January meeting of the EPA support steering committee - comprised of government and EU representatives.[iii] In particular, Central African officials blame complex EU administrative procedures for preventing the use of €5.5 million in EDF technical-assistance support for improving production capacity and economic competitiveness.
Central African government officials welcomed indications from the French government that it is insisting that EU negotiators focus on the development dimensions of the EPA. Sources say they hope EU technical-level EPA negotiators will be instructed to be flexible in addressing the region’s concerns.. French trade and cooperation ministers wrote to the EU Presidency, the EC and EU Member States proposing that they take the initiative to find flexible trade arrangements for regional agreements.[iv] They suggest that the EU could envisage a more limited opening of ACP markets than the current 80% being proposed and to be allowed longer trade liberalisation transition periods. They also call for discussions on financial support. The French Parliament’s European Affairs Committee also produced its latest report on the EPAs[v] which is critical of EC negotiators and calls for a change in the EU’s EPA negotiating tactics under the new trade commissioner to ensure more attention to development concerns.
Nigeria retains Presidency of ECOWAS Authority of Heads of State
ECOWAS Heads of State and Government met in Abuja on 16 February, after the meeting was postponed a couple of times. The meeting was chaired by the Vice-President of Nigeria, Goodluck Jonathan, as the Nigerian president, Umaru Musa Yar’Adua, is currently hospitalized in Saudi Arabia. It was decided that Nigeria would retain the Presidency of the ECOWAS Authority of Heads of State and Government for an additional year. However, the heads of state were unable to agree on a new president of the ECOWAS Commission. In the interim, Ghanaian Ambassador Victor Gbeho will hold the post until December 2010. In terms of the EPA negotiations, the heads of state affirmed that West Africa and the EU need to reach a consensus, particularly on the development dimension of the agreement.
Technical negotiators informed their EU counterparts at a meeting on 4-5 February that further consultations are necessary in order to revise the region’s market access in goods offer before negotiations can begin with the EU. In November, West Africa had offered tariff liberalisation for 67% of the region’s goods and called for up to a 25-year transition period for some products. The EC, however, called on the West Africans to further refine the offer towards a liberalisation threshold of 70% coverage of tariff lines and volume and for some products to be liberalised faster.
West Africa-EU negotiations will continue in March. These include a meeting of the Regional Preparatory Task Force on 18-19 March; a technical experts meeting from 22-25 March; and a senior officials meeting on 25-26 March. Issues to be discussed include market access, rules of origin, modalities for financing the EPA Development Programme, regional levies, the MFN clause, the non-execution clause and agricultural subsidies.
At the EU-Cape Verde ministerial-level political dialogue held on 26 January, the parties welcomed the continuation of West African EPA negotiations as well as the progress made on the EPA Programme for Development.[vi] They stressed the need to overcome the last few steps in the negotiations as soon as possible. They also welcomed the road map for the implementation of the 10th European Development Fund (EDF) Regional Indicative Programme for West Africa.
ESA region seeks political guidance before continuing negotiations
Eastern and Southern Africa regional leaders are seeking a meeting with the new European trade and development commissioners to establish a high-level political understanding regarding contentious EPA issues before continuing with technical-level negotiations. Meetings may be held in the second half of February.
EU threatens to withdraw EAC trade preferences if interim EPA not signed
The head of the EU delegation to Tanzania, Ambassador Timothy Clark, says a realistic timetable for signing the East African Community’s interim EPA must be established.[vii] The EU Delegate also issued a statement ahead of an East African Community Ministers’ meeting on 4 February in Arusha encouraging ministers “to give a clear signal that they are willing to sign the EPA as initialled in 2007″ [in order to] “obtain legal security for the agreed market access to the EU.”[viii] Clark said: “The situation, as it stands now, is untenable. EAC countries, despite not signing the EPA, have been enjoying free access to EU markets in the same way with other ACP countries that took legally binding commitments by signing EPA. This is inconsistent and in fact the current situation is contrary to both EU law and World Trade Organization rules.” The EC also posted the consolidated EAC EPA text and final act on its website.[ix]
Tanzanian Trade Minister Mary Nagu said the EAC wanted firm commitments from the EU on development assistance before it would sign a full agreement. “We need infrastructure such as properly working railways and ports to enable us to trade. We would like to sign as soon as possible after resolving these issues … There won’t be a level playing field if the agreement is signed in its very general form. We need to benefit from trade, we can’t continue begging in the form of aid,” she said.[x]
Withdrawing trade preferences provided to the EAC under the EU’s EPA market access regulation would require a unanimous vote by EU Member States which may prove politically difficult at this time. There is also no indication that a WTO challenge is being considered at this time.
EAC Member States met in Bujumbura from 18-22 January to analyse why the EAC-EC negotiations failed in December 2009 and to consider the options available to move forward with the development component of the EPA. According to a Kenyan Trade Ministry statement, the outstanding issues are economic development, export taxes, and the Most Favoured Nation (MFN) clauses. The ministry explained that economic development issues are pertinent in addressing supply side constraints, while export taxes and MFN clauses limit policy space.[xi] Negotiations on these outstanding issues are ongoing at both the regional and EAC-EC level, as the parties work towards an interim framework EPA. Kenya, with other EAC partner states, are negotiating to get the best deal, and are well aware of the urgency to append the signatures, said the Ministry.
Another round of EPA regional negotiations is scheduled to be held from 15-20 February in Kampala. Subsequently, joint EAC-EU technical-level negotiations will take place in Brussels on 23-24 February to discuss outstanding issues.
SACU agrees to negotiate as a bloc in SADC EPA negotiations
Senior SADC EPA officials met on 11 February, following a January SACU (Southern African Customs Union) Council of Ministers meeting and agreed that Botswana, Lesotho, Namibia, South Africa and Swaziland will move forward as one SACU entity in the SADC EPA negotiations. They also agreed not to notify the interim EPAs signed by Botswana, Lesotho and Swaziland to the WTO. Ratification and implementation of these interim EPAs has also been put on hold until outstanding issues on development concerns, rules of origin and alignment have been resolved with South Africa, Namibia and the EU.
An EU-SADC EPA senior officials meeting is scheduled to be held from 17-19 March. A full SADC-EU EPA may be concluded by the end of 2010.
Tripartite Task Force signs MoU with UK DFID
The Tripartite Task Force (TTF) - a coordination mechanism for the East Africa Community (EAC), Common Market for Eastern and Southern Africa (COMESA) and the Southern Africa Development Community (SADC) - signed a Memorandum of Understanding (MoU) with the United Kingdom’s Department of International Development (DFID) aimed at deepening regional integration and strengthening cooperation between donors supporting the region’s integration.[xii] It will serve as the basis for a long-term, strategic and operational partnership. The MoU commits the TTF to promoting and accelerating regional integration in Africa; implementing recent decisions on trade integration and infrastructure cooperation; forming a free trade area across the three regions; and assisting the Regional Economic Communities to mobilise their resources.
Caribbean focused on EPA implementation
The CARICOM (Caribbean Community and Common Market) Council of Ministers - the region’s second highest decision-making organ - met on 10 February.[xiii] The meeting was preceded by a meeting of the Council for Trade and Economic Development which considered a report on the status of implementation of the CARICOM Single Market and Economy (CSME). The report found that the CARICOM single market was functioning but there were gaps in the legislative, institutional and infrastructural framework that needed to be addressed. Among the other matters the ministers dealt with were agriculture trade, development of the services sector, information and communication technology for development and EPA implementation.[xiv] No further details on the outcome of these meetings have been made available. A regional EPA implementation unit within the CARICOM Secretariat has been established which provides services also to the Dominican Republic, which not formally a CARICOM member, but an EPA signatory. The unit is still in the process of recruiting staff. A number of CARIFORUM states also have arrangements in place to deal with the implementation of the EPA. These include stand-alone units, mechanisms within institutions dealing with the implementation of bilateral agreements and tasks assigned to government ministries.
The Bahamas and the EU initialled trade in services and investment commitments to be annexed to the Caribbean-EU EPA on 25 January.[xv]
While the Bahamas signed the EPA in October 2008, it had postponed completing and submitting its services and investment offers to the EC.
The Commonwealth Secretariat’s Hub and Spokes programme, together with the Trinidad and Tobago Trade Ministry, held a workshop on 2 February on how to take advantage of the EPA’s market access provisions.[xvi] Similar initiatives are taking place throughout the region. Several helpful presentations can be found on the event’s website.
Both the EU and the Caribbean are redefining their external relations priorities in the context of a rapidly evolving geopolitical scene, which is expected to begin with a joint process of reflecting on a future partnership that enables both parties to better respond to global challenges. In the run up to the EU-Latin America-Caribbean heads of states summit in mid-May in Madrid, the current Spanish EU Presidency will stimulate reflection on the future of the Caribbean-EU partnership.[xvii]
The development of several programmes under the Caribbean Integration and Cooperation Roadmap should be completed by the end of March. Programmes include economic integration in the OECS, EPA capacity building and support to the Caribbean Export Development Agency.
A regional meeting to discuss support for customs and trade facilitation is tentatively scheduled for the end of February 2010. Arrangements are also being finalised for an assessment of the role that the Caribbean Development Bank will play with respect to the management of EPA implementation funds under the 10th EDF Regional Indicative Programme.
Pacific
Fiji and Papua New Guinea are the first two Pacific countries to benefit from a new preferential rule of origin for the export of processed fish and marine products to the European market provided under the EPA.[xviii] Fish, regardless of their origin, are deemed to originate from these Pacific ACP countries as long as they are transformed from being fresh or frozen into a pre-cooked, packaged and canned product in Fiji or Papua New Guinea and can then be exported to the EU free of duties and quotas. Allowing this global sourcing was a key demand of the Pacific ACP (PACP) in its EPA negotiations with the EU. First Counsellor of the EU’s Delegation in Fiji, Robert De Raeve, explained that global sourcing was a ‘flexible mechanism’ to suit the special needs of PACPs who have limited products to trade under the EPA. He was, however, quick to point out that the new arrangement was a one-off and exclusive only to the Pacific.
The PACP held technical EPA meetings in Port Vila from 25-29 January to discuss legal and institutional capacity building. At the same time, joint customs, legal and trade officials met to discuss EPA customs-related provisions. Joint fisheries and trade officials also met. The meetings were held to consider provisions in the draft PACP-EU EPA with a view to advancing and finalising PACP positions on these issues in the EPA negotiations. It was agreed that the PACPs would undertake further consultations with relevant stakeholders at the national level on issues discussed at these meetings in order to formulate text-based proposals to submit to the EC. The EU Council forwarded the Pacific-EU EPA to the European Parliament for its consent.[xix]
Effort is also being made to hold a Forum Fisheries Committee meeting prior to the PACP Trade Ministers Meeting and the PACP-EC Joint Technical Working Group Meeting tentatively scheduled to be held in June. A PACP meeting of trade officials tentatively scheduled for March 2010 will discuss these issues further. A technical round of negotiations with the EU will also be held in June.
The EU will reconsider funding the office of the regional chief trade negotiator for PACER Plus (Pacific Agreement on Closer Economic Relations between the Pacific Islands and Australia and New Zealand) if all Pacific Islands Forum countries agree, although it is unlikely the full €7 million proposed by the Pacific Islands Forum Secretariat will be provided.[xx] The Pacific governments, the negotiator-designate and NGOs have expressed concern as to the independence the office will have under the contract being offered.[xxi]
[i] EU Trade Commissioner Karel De Gucht’s website: http://ec.europa.eu/commission_2010-2014/degucht/
[ii] Communiqué final du sommet de Bangui de la CEMAC. 17 janvier 2010.
[iii] Cameroun-UE. Retards persistants dans la mise mise en oeuvre de l’accord de partenariat économique. Xinhua. 8 février 2010.
http://french.news.cn/afrique/2010-02/09/c_13169050.htm
[iv] La France souhaite que l’UE propose des solutions originales pour relancer la négociation sur les APE, http://www.regards-citoyens.com/article-la-france-souhaite-que-l-union-europeenne-propose-des-solutions-originales-pour-relancer-la-negociation-sur-les-accords-de-partenariat-economique-ape–40878116.html
[v] Rapport d’information déposé par la commission des affaires européennes sur les accords de partenariat économique entre l’Union européenne et les pays d’Afrique, des Caraïbes et du Pacifique, L’Assemblée nationale de la France. 2 décembre 2009.
www.assemblee-nationale.fr/13/europe/rap-info/i2133.asp
[vi] EU-Cape Verde Political Dialogue Meeting at Ministerial Level discuss EPAs and the JAES. Joint Communique. 26 January 2010.
[vii] EU wants timetable for east Africa trade deal. Reuters. 16 February 2010. www.alertnet.org/thenews/newsdesk/LDE61E26I.htm
[viii] EU patience running thin on East African EPA with Tanzanian and Ugandan demands while Kenya may break ranks to sign. allAfrica.com. 8 February 2010.
http://allafrica.com/stories/201002080332.html
[ix] EU-EAC EPA Agreement. Final act. Posted on EC DG Trade website on 12 February 2010. trade.ec.europa.eu/doclib/html/145793.htm and EU-EAC EPA Agreement. Consolidated text. Posted on EC DG Trade website on 12 February 2010. trade.ec.europa.eu/doclib/html/145792.htm
[x] EU wants timetable for east Africa trade deal. Reuters. 16 February 2010. www.alertnet.org/thenews/newsdesk/LDE61E26I.htm
[xi] EU deal no threat to EAC says Kenya. Capital FM Kenya. 11 February 2010. http://www.capitalfm.co.ke/business/Kenyabusiness/EU-deal-no-threat-to-EAC-says-Kenya-3791.html
[xii] UK DFID agreement boosts regional working in Africa. 27 January 2010
http://www.dfid.gov.uk/Media-Room/News-Stories/2010/Agreement-boosts-regional-working-in-Africa/
[xiii] The Community Council of Ministers of the Caribbean Community (CARICOM). Georgetown. 10 February 2010.
http://www.caricom.org/jsp/pressreleases/pres71_10.jsp
[xiv] Council for Trade and Economic Development discusses CSME and EPA implementation. CARICOM press release. 11 February 2010.
www.caricom.org/jsp/pressreleases/pres67_10.jsp
[xv] The Bahamas initials EPA trade in services and investment commitments with the European Union. EC Press Release. 25 January 2010.
http://trade.ec.europa.eu/doclib/press/index.cfm?id=511
[xvi] EPA Awareness Workshop “Taking Advantage of the CARIFORUM European Union Economic Partnership Agreement - How to do Business in the EU” February 2nd 2010, Trinidad Hilton http://www.tradeind.gov.tt/Agreements/EPA/epa_09.htm
[xvii] Towards a Joint Caribbean-EU Strategy. ECDPM Informal Note. February 2010.
[xviii] New preferential rules for PACP fish export to the EU. PACNEWS. 4 February 2010.
www.pina.com.fj/?p=pacnews&m=read&o=8722422014b69e6f0b23c44c4575c8
[xix] EU Council forwards EU-Pacific Economic Partnership Agreement to Parliament for its consent. EU Council press release. 16 February 2010. http://www.consilium.europa.eu/App/NewsRoom/loadDocument.aspx?id=350&lang=EN&directory=en/ecofin/&fileName=112912.pdf
[xx] OCTA will need consensus of all Forum members before EU reconsiders funding. PACNEWS. 5 February 2010.
www.pina.com.fj/?p=pacnews&m=read&o=16727925274b6b707ff7b225e114da
[xxi] Pacific trade adviser concerned about independence. PACNEWS. 27 January 2010.
www.pina.com.fj/index.php?p=pacnews&m=read&o=14332641644b5f8d56014e4401dcda and http://australianetworknews.com/stories/201002/2822645.htm?desktop
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