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EU Finally Adopts EPAs For ACP Countries

by Ulrika Lomas, Tax-News.com, Brussels

13 December 2007


After years of difficult negotiations, Peter Mandelson, EU Trade Commissioner, has finally secured adoption of a ruling which will bring into effect a set of Economic Partnership Agreements with ACP member countries giving them free access to the member states of the the EU for their goods exports in return for opening their own markets to the EU after transition periods of up to 25 years.

The EU has been offering the ACP countries the EPAs to replace the trade chapters of the 2000 Cotonou Agreement between the EU and the ACP countries, whose exemption from WTO rules will expire at the end of 2007 after it was attacked by other countries outside the Cotonou agreement, alleging ex-colonial preference.

The 78 ACP countries fall into three groups: those who have accepted the EPAs, and are covered by this week's ruling - 15 of those; those which are still refusing to accept the EPAs - 27 of those, and if they don't sign up by 31st December they will find themselves back in the old 'GSP' regime as of January, with quite high tariffs imposed on many of their key exports; and the remainder, who are so poor that they are covered by unilateral EU concessions - to them, the EPAs are irrelevant.

At this stage the EPAs only cover trade in goods; negotiations on services have been postponed until 2008.

Peter Mandelson faced heavy criticism at last weekend's EU/Africa summit from some African leaders, including Thabo Mbeki and Senegalese president Abdoulaye Wade. "Both of them have absolutely nothing to lose," he hit back. "If all of Africa has rejected EPAs, why are we getting people signing?" he asked.

In a statement from Brussels on Tuesday, Mandelson summed up the situation as follows:

"In East Africa we have a region-wide interim agreement including market access deals with all the non-LDCs in the region. Many LDCs - despite the fact they already benefit from 100% access under EBA - are keen to come on board and, progressively, are doing so. Madagascar today, Malawi too, Zambia ready, all with proper market access offers.

"In the Pacific, we have an interim-agreement with the two countries responsible for almost all the trade with the EU - Papua New Guinea and Fiji. I expect to enlarge this to a full regional agreement in 2008.

"In Southern Africa, we have an agreement with Botswana, Lesotho, Swaziland and Mozambique. Angola, ambitious in its market access offer, will I believe join shortly. South Africa is staying out for now and already has its preferential trade agreement with the EU. We are making progress with Namibia and I think it will be possible to find a way through very soon.

"In West Africa, the position of Nigeria has made a regional agreement impossible in the short-term. So we have sought to secure the position of those who are most exposed. Ivory Coast signed an interim agreement on Friday. Our discussions with Ghana confirm that we expect to reach an agreement soon.

"In Central Africa, a regional agreement is also not possible in the short-term. So we must secure the position of the two who stand to lose out. Our teams have been there over the past two weeks. We hope to have agreements with Cameroon and Gabon, the other major non-LDC with whom we are also in touch, in the coming days.

"In the Caribbean, following an intense negotiating drive, then a month without movement, I believe the region now wishes to move ahead. Our senior negotiators will meet them this week in order to seek to complete negotiations before the end of the week."

For the last year, Mandelson has been doing his best to parlay the conflicting interests of the ACP countries, the EU member states, the WTO's 'Aid for Trade' program and the quarrelsome European Parliament into a coherent developing country strategy. But reaching an agreement between all of these competing factions proved to be something of a sisyphean task for Mandelson, despite the looming deadline. The ACP countries want to retain preferential access to the EU for products such as sugar and bananas, plus they want more development aid, but they don't want to liberalize their own tariff barriers; the WTO wants an end to all preferential arrangements; the EU member states want to protect their old colonies, but not to spend any more money on aid.


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