EPA Update: by Melissa Julian

4 November 2011

ACP regional organisations discuss EPAs

Heads of ACP regional organisations and Chief Regional EPA Negotiators met in Brussels from 16-20 October. Most regions reportedly reaffirmed their commitment to concluding a development friendly EPA, but noted that many unresolved issues remain. Lorand Bartels presented his external legal opinion on the EC proposal to technical experts. It concluded that the EC action had violated the Vienna Convention on the Law of Treaties and that the content of the agreement itself, not the timing imposed by a deadline, should determine the conclusion of the EPAs. The European External Action Service's Chief Operating Officer informed ACP representatives that there may be opportunities to redistribute funding between ACP countries to redress current low regional level disbursements. The EU Development Commissioner outlined the EC's proposals to revise EU development policy, focusing on aspects relating to simpler programming of EU aid disbursement. The EU Trade Commissioner outlined the EC's proposals to withdraw the EPA market access regulation while noting that negotiations in most regions were proceeding well.

Joint Parliamentary Assembly's trade committee criticises EC EPA deadline proposal

At the ACP-EU Joint Parliamentary Assembly's Economic Development, Finance and Trade Committee meeting in Brussels on 4 October, the European Commission (EC) Directorate-General for Trade's Director responsible for the Economic Partnership Agreements (EPAs), Peter Thompson, presented the EC's proposal according to which countries that have concluded an EPA but not taken the necessary steps to ratify and implement it would no longer benefit from the EPA market access to Europe as from 1st January 2014. (1)

In response, the South African representative read out a statement on behalf of the Southern African Development Community (SADC) EPA group on the EC's EPA and Generalised System of Preferences (GSP) proposals recognizing their negative impact, particularly on some non-LDC ACP States. He also noted that these proposals were a way of "coercing regions to conclude an agreement which is not credible". The statement underlined that the EC's EPA proposal came as a surprise because the EC and the SADC EPA group made a joint statement to delay ratification and implementation of the SADC EPA until regional development friendly agreements were reached. The two proposals bring a lot of pressure, potentially undermining negotiations at a time when a renewed and positive momentum is observed, and could compromise the credibility of the final agreement.

The statement also reads that EPAs are meant to support the ongoing regional integration processes, but that the EC's differentiated approach contained in the proposal would significantly undermine these efforts. The SADC statement reiterated the region's commitment to EPA negotiations and wish to continue working towards a balanced and mutually satisfactory outcome. It reaffirmed the importance of addressing and resolving outstanding issues in a balanced way, which include MFN Clause, regional levies, standstill clause, export taxes, development cooperation and rules of origin.

The Namibian representative also read out a statement saying that a significant number of complex issues still needed to be resolved in the SADC-EC EPA negotiations in order to ensure that regional integration is not disrupted. He added that it is not possible to notify or ratify an agreement under negotiation, and that the EC proposals may undermine the progress made so far and the ability of the Namibian government to scrutinise the EPA. He called on the European Parliament and Member States' support to ensure that ACP countries are not forced to sign an EPA simply out of fear of losing market access.

In his reply, Peter Thompson said the EC has shown flexibility in the EPA negotiations on issues such as market access, infant industry and export duties, but that there are limits to what the EC can offer. Stressing that the EPA market access regulation had been questioned in the WTO, he stated that this Regulation needed to be replaced by a legally sustainable trade regime in order to provide investor with security. The EC thinks negotiations can be completed by 2014, "but this is not a deadline". "EPA negotiations can go on ad infinitum" he added.

Central Africa and EC technical experts hold negotiating session

Central Africa and EC negotiations at the technical level were held in Bangui from 26-30 September. Negotiations on Central Africa's market access offer included discussions on EC proposals to add several tariff lines for liberalisation. Central African national opinions and a regional ministerial orientation will now be sought on the EC's proposals. This will be the basis for a new Central African new market access offer with dismantlement timetables to be submitted to the EC.

Services negotiations focused on EPA articles concerning information services, post and courier services, telecommunications services and a cultural cooperation protocol. The EC presented its offer on Mode 4 (movement of natural persons). The implementation of commitments was discussed.

With regard to EPA accompanying measures, Central Africa reported on the state of play in the identification process for the Central African development programme to accompany the EPA - PRADA (the French acronym for ‘Programme Régional d'Accompagnement du Développement dans le cadre de l'APE'). National level impact assessment inventories are nearly completed in all countries except Equatorial Guinea and Sao Tome et Principe. A regional synthesis will then be done and presented for discussion at a meeting of the Central Africa-EC EPA Regional Preparatory Task Force.

Discussions also took place on the methodology used to calculate the net fiscal impact of the EPA, with Central Africa presenting a draft orientation note on the issue. The two parties agreed to establish a joint technical follow-up committee to elaborate models and evaluate the net fiscal impact.

The next round of technical level negotiations is scheduled to be held from 14-18 November in Brussels.

West Africa technical negotiations to resume in November

West African and EC technical experts will hold a negotiating round from 8 -11 November in Accra, Ghana.

The ECOWAS Ministerial Monitoring Committee on EPAs, originally scheduled for September, is now postponed to 28-30 November.

SADC concerned by EC EPA deadline proposal ahead of November negotiating round

The statements from SADC and Namibia to the ACP-EU Joint Parliamentary Assembly's Economic Development, Finance and Trade Committee meeting in Brussels on 4 October, are outlined in the relevant section above.

Press reports from the region indicate that Namibian Trade and Industry Minister Hage Geingob is furious that the EC put forward the EPA market access proposal, just weeks after he met with EC Trade Commissioner Karel De Gucht, who reportedly did not indicate the proposal was imminent.

Namibia is concerned that it will not be able to fall back on other preferential regimes should EPA negotiations not resolve a certain number of issues, unlike other SADC member states who do have alternative fallback options. Namibia is an upper middle income country, and as such would be barred from GSP access under the current EC proposal for GSP reform. This could mean more than half a billion dollars in extra duties on Namibian goods. (2)

At the Joint Parliamentary Assembly committee discussions, Peter Thompson said the EC was confident, based on recent discussions on the margins of the recent South Africa Summit, that an EPA agreement with SADC was possible if market access issues could be sorted out. Axel Pougin de la Maisonneuve, head of the political, economic and trade section of the EU delegation in South Africa is quoted in the press as saying "We wouldn't have done this if we didn't feel quite strongly that the EPA process will lead to agreements in the next few months and that we should be able to sign a deal with all parties by the end of the first quarter of 2012." (3)

South Africa's chief trade negotiator on the EPA, Xavier Carim, agrees that it is possible that the talks could be wrapped up by next year, saying the parties are "in a better position [to conclude them] than we have been for some time".

An EU-SADC EPA technical and senior officials meeting is tentatively scheduled to be held from 14-18 November in Lesotho.

ESA EPA Council agrees way forward on EPAs

Ministers from the Eastern and Southern African (ESA) EPA group held a Council meeting in Lilongwe on 11 October to evaluate the status of EPA negotiations and the implications of the recent EC EPA market access proposal. Ministers welcomed the progress of negotiations on trade facilitation, SPS, TBT, trade in services, agriculture, some trade-related issues and on the consolidated joint draft EPA text. They also urged the parties to maintain the new momentum in all these areas. Ministers however noted that positions regarding some of the contentious issues have not changed. They emphasized the importance of maintaining development and regional integration as the core objective of the negotiations, taking into account the interest of non-LDCs and LDCs on board. They added that flexibility on the positions from both sides, based on an understanding of the core concerns and interests of each other, is crucial. There is also a need to bring the negotiations to finality based on a reality check of what is achievable.

The COMESA summit communiqué adopted on 15 October noted that progress has been made in negotiating the contentious issues between the countries of the ESA-EPA group and the European Union and reiterated that the objective of the EPA is to support ESA development and regional integration. (4)

Regional consultations will be conducted ahead of an ESA-EU joint technical and senior officials' negotiations to be held early December to consider the bracketed texts and options to be presented by ESA. A Joint ESA-EU ministerial meeting to consider outstanding issues at senior officials level should be held before end of year or early next year.

EAC prepares next round of negotiations

EAC technical experts met on the week of 16 October to discuss EC proposals on rules of origin, development cooperation and agriculture. No information on the discussions or outcomes of the meetings were available as TNI goes to press.

An EAC-EC technical experts meeting is tentatively scheduled to be held in mid-November in the region.

South Sudan has confirmed that it is joining the East African Community.

EC studying global sourcing on rules of origin ahead of Pacific round of negotiations

The EC has proposed a negotiating session in the second quarter of 2012. A study on global sourcing rules of origin, examining the case of Papua New Guinea, is currently being conducted by the EC. According to EC officials it would be more useful to have discussions after the study is conducted as the findings will guide discussions on PACP request for global sourcing rules of origin to be extended to fresh/chilled fish.

Author:

Melissa Julian is Knowledge Management Officer at ECPDM

1 See here

Namibia to box EPAs in Lesotho, New Era, Windhoek, 13 October 2011, and

Namibia pushes for best EPA deal. Windhoek Observer. 17 October 2011,

and Billions in balance if Namibia-EU trade pact fails. The Namibian. 11 October 2011.

SADC and the EU trade negotiations. A step closer. bilaterals.org. 20 October 2011

COMESA Summit Communique. 15 October 2011.

This article is published under
4 November 2011
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