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The acp-eu-trade.org newsletter - Special issue #2 - 13 December 2007
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EPA negotiations: Where do we stand?

- updated weekly -



In this issue: EPA negotiations: Where do we stand?
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I. Key updates of the week
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II. An Overview


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Dear readers,

A number of further interim agreements towards full EPAs were initialled during the last week. Below please find a general summary of the current state of play. Updates of this week have been highlighted in red.
For details, visit our online pages “EPA negotiations: Where do we stand?” at http://www.acp-eu-trade.org/epa. Besides giving an overview of the current state of negotiations in each region, these pages provide links to recent articles from ACP and EU news providers and highlight new relevant documents. Further, a printable pdf document that includes a complete set of all pages can be downloaded.

French versions of the updates are available for the All ACP overview as well as for the regional pages on Central Africa, West Africa and Eastern and Southern Africa (ESA). A French version of this pdf document includes the pages “All ACP”, “Central Africa”, “West Africa” and “ESA”.

The updates of previous weeks can be accessed in pdf format through our library.
Press articles previously displayed on the “EPA negotiations: Where do we stand?” pages are archived in our searchable news section.
Key documents and new publications are equally available in our library, which also gives access to a rich pool of documents in addition to those presented on the EPA pages.

As always, we welcome any comments or additional information you are willing to share.

Editors: Davina Makhan (dm@ecdpm.org) and Corinna Braun-Munzinger (cbm@ecdpm.org)


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To read this week’s “EPA negotiations: Where do we stand?” online click on the following link http://www.acp-eu-trade.org/epa
To download the pdf document, click here

La mise à jour de cette semaine de « La négociation des APE: Etat des lieux » sera disponible prochainement en format html et pdf à l’adresse suivante www.acp-eu-trade.org/ape


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I. Key updates of the week
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All ACP
• At its meeting on 10 December 2007, the Council of the EU reached political agreement on a market access regulation, to be adopted on 20 December 2007.

• EPAs were a controversial topic at the EU-Africa summit on 7-9 December 2007.

CARIFORUM
Reportedly, Caribbean Heads of State, who met on 7 December 2007 in Guyana, have agreed on a market access offer in goods and services in line with EC requests.

ESA
An ESA-EC interim agreement was initialled by Mauritius, the Seychelles, Zambia and Zimbabwe.

West Africa
Interim agreements were initialled between the EC and Cote d’Ivoire on 7 December 2007 and between the EC and Ghana on 13 December 2007.

ESA
Comoros and Madagascar initialled the ESA-EC framework agreement on 11 December 2007.

SADC
Namibia initialled the SADC-EC interim agreement on 12 December 2007.



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II. An Overview
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A. Current developments
While all parties remain committed to concluding comprehensive EPAs, as confirmed in the joint review endorsed in May 2007, progress in the negotiations has been slower than expected. By October 2007, it became apparent that EPAs would not be concluded by the target date of 31 December 2007, set by the expiry of the WTO waiver covering the current preferential trade regime of Cotonou. In reaction to this, the European Commission issued a communication on 23 October 2007 (see below), which outlines a pragmatic approach to safeguard preferential market access for non-LDC countries from 1 January 2008 . The communication aims at extending the negotiation time towards complete EPAs while avoiding a disruption in trade. In line with this approach, the EC is currently concluding WTO compatible market access arrangements with regions, subregions and individual countries. These interim agreements contain rendezvous clauses to continue negotiations in 2008 towards full EPAs. This solution will circumvent a loss of trade preferences while fully respecting the letter of WTO rules. However, if these agreements are not concluded, the EC may have to face political pressure if it applies the GSP regime to non-LDCs from 1 January 2008, which will imply raising tariffs.

At its meeting on 10 December 2007, the Council of the EU reached political agreement on a market access regulation to grant duty and quota free access to the EU market to ACP countries from 1 January 2008, with transition periods for sugar and rice. The regulation will be formally adopted by the Council on 20 December 2007. It will apply to those ACP countries that have concluded negotiations on either a full EPA or an interim agreement, which will be listed in Annex I of the regulation. Any ACP state that initials an agreement with the EC before 20 December can be included in this annex to benefit from the market access provisions from 1 January 2008. The regulation is expected to provide for the possibility of amending the annex by countries concluding negotiations at a later point in time.

At the current state of negotiations, most African non-LDCs might conclude an interim agreement and the Caribbean region might sign a full EPA to establish a new WTO compatible trade regime after expiry of the waiver. However, concluding EPAs with sub-regions or individual countries is likely to have serious implications on regional integration dynamics in the ACP.

A brief look at each of the six negotiation regions gives a more detailed picture of the current state of play:



• In the Pacific, Papua New Guinea and Fiji have concluded interim agreements. For the other ACP countries in the region the export volume to the EC is very low, hence they do not face a disruption of trade.


§ To read more, click here


• In East and Southern Africa (ESA), the East African Community (EAC) members (Burundi, Kenya, Rwanda, Tanzania and Uganda) have decided in November 2007 to form a separate EPA region and initialled an interim agreement on 27 November 2007. The remaining ESA countries have opted for a framework agreement with a common text but separate market access schedules. The ESA-EC interim agreement has so far been initialled by Comoros, Madagascar, Mauritius, the Seychelles, Zimbabwe and Zambia. (Information on Zambia and Malawi varies, see ESA page for details.)


§ To read more, click here


• In the SADC EPA region, an interim agreement has been initialled by Botswana, Namibia, Lesotho, Swaziland and Mozambique. South Africa, despite forming the customs union SACU with Botswana, Namibia, Lesotho and Swaziland, is not taking part in the interim agreement so far. Without joining the agreement, South Africa would export to the EU under its TDCA agreement with the EU.

§ To read more, click here


• In Central Africa, no regional interim agreement is expected. Instead, the non-LDCs Cameroon and Gabon may possibly conclude individual interim agreements with the EU. This would leave the Republic of the Congo as the only non-LDC in the region exporting under the GSP.


§ To read more, click here


• Similarly the West African region has indicated that it is not interested in concluding an interim agreement but estimates that another 12 -18 months of negotiation time are needed to reach a full EPA. Cote d’Ivoire and Ghana initialled interim agreements with the EC. According to the EC, discussions on possible interim agreements are taking place with further West African countries; however, Nigeria, being the third non-LDC in the region, is unlikely to conclude such an agreement.


§ To read more, click here


• In the Caribbean, which is mostly composed of non-LDCs, a full regional EPA is likely to be concluded either in 2007 or in early 2008. However, additional bilateral negotiations are taking place between the Dominican Republic and the EC.


§ To read more, click here


Table 1 below gives an impression of the liberalisation commitment contained in initialled agreements and table 2 provides an overview of sensitive products excluded from liberalisation.


Table 1a: Liberalisation schedules agreed in initialled interim agreements
(cumulative value of imports from the EU, to be liberalised by the specified year)


2008

2010

2012

2013

2017

2018

2022

2023

2033

total
Fiji















80%



80%
Papua New Guinea















88%



88%
EAC



64%











80%

82%

82%
Comoros







21.5%





80.6%





80.6%
Madagascar







37%





80.7%





80.7%
Mauritius

24.5 %







53.6%



95.6%





95.6%
Seychelles







62%

77%



97.5%





97.5%
Zimbabwe





45%







80%





80%
Botswana, Lesotho, Namibia,
Swaziland



86%















86% + 47 tariff lines
Mozambique

Mostly liberalised at entry into force

















80.5%
Cote d’Ivoire











69.8%



80.8%



80.8%
Ghana















80.48%



80.48%


Table 1b: Liberalisation schedules agreed in initialled interim agreements
(cumulative percentage of tariff lines, to be liberalised by the specified year)


2008

2010

2015

2017

2018

2022

2023

total
Fiji













80%a

80% a
Papua New Guinea













82% a

82% a
EAC















74% a
Mauritius

26% a





73% a



96.6% a



96.6%a
Botswana, Lesotho,
Namibia,
Swaziland



86% a

44b



3b





86% a + 47 tariff lines
Mozambique









100b






Cote d’Ivoire









83.9% a



88.7% a

88.7% a
Ghana













80.01% a

80.01% a
acumulative percentage of tariff lines
badditional number of tariff lines to be liberalised by the specified year


Table 2: Goods excluded from liberalisation
Pacific

Certain agricultural and forestry products as well as non agricultural processed goods are excluded from liberalisation by both Papua New Guinea and Fiji. The main criterion of these exclusions is the desire to protect infant industry and maintain fiscal revenues.
EAC

Exclusions include: agricultural products, wines and spirits, chemicals, plastics, wood based paper, textiles and clothing, footwear, glassware. The main criterion of these exclusions is the desire to protect infant industry.
ESA

Several products from different sectors have been excluded from liberalisation, mainly due to the need to protect sensitive products or infant industries in the countries. In the case of Seychelles, these include meat, fisheries, beverages, tobacco, leather articles, glass and ceramics and vehicles. In the case of Zimbabwe, excluded products include products of animal origin, cereals, beverages paper, plastics and rubber, textiles and clothing, footwear, glass and ceramics, consumer electronics and vehicles. Mauritius excluded from liberalisation live animals and meat, edible products of animal origin, fats, edible preparations and beverages, chemicals, plastics and rubber articles of leather and fur skins, iron & steel and consumer electronic. In the case of Comoros, the excluded goods are mainly of animal origin, fish, beverages, chemicals and vehicles. For Madagascar, the excluded products comprise meat, fish, products of animal origin, vegetables, cereals, beverages, plastics and rubber, articles of leather and fur-skins, paper and metals among others.
SADC

Exclusions focus on agricultural goods and some processed agricultural goods and are based chiefly on the need to protect infant industries or sensitive products in these countries.
West Africa

Certain agricultural as well as non agricultural processed goods are excluded from liberalisation by Ivory Coast and Ghana. The main criterion of these exclusions is the desire to protect certain existing industries or infant industry and maintain fiscal revenues.
(Quoted from: Update: Interim Economic Partnership Agreements, European Commission, 13 December 2007,
http://trade.ec.europa.eu/doclib/docs/2007/november/tradoc_136959.12.07.pdf)



B. Next meetings at the all ACP-EC level

On 20 December 2007, the Council of the EU is expected to formally adopt the market access regulation on which political agreement was reached on 10 December 2007 (see above).



To read more on recent events and find background information and additional resources relevant to the all-ACP level, click here



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Read more on the state of play of the EPA negotiations in each region at www.acp-eu-trade.org/epa

La version française de nos mises à jour sera disponible sous peu à www.acp-eu-trade.org/ape

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