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Economic Partnership Agreement Negotiations On Track

Namibian, Namibia

Economic Partnership Agreement Negotiations On Track

Catherine Sasman

18 July 2011

Southern African Development Community (SADC) Economic Partnership Agreement (EPA) negotiations are ongoing while efforts are at an advanced stage to consolidate and harmonise market access arrangements for the Southern African Customs Union (SACU), reported Deputy Minister of Trade and Industry Tjekero Tweya in Parliament last Thursday.

At stake here, said Tweya, is also an interest by the European Union (EU) to improve its terms of trade with South Africa, which he said could directly or indirectly affect Namibia and other countries part of SACU.

Tweya said the European Commission has also made new proposals on trade-related issues, which were not considered by Namibia to have been within the scope of the negotiations.

One of these issues is the geographical indications demanded by the EU. Tweya said this issue, among others, would be addressed when negotiations resume.

He said there are other available markets for Namibia’s beef, grapes and fish in the event of Namibia losing EU market access.

He, however, emphatically stated that Namibia intends to secure its market access to the EU, but pointed out that the country should diversify its markets, especially in view of threatening preference erosion.

This, he said, refers to the threat of Namibia’s exports losing their competitiveness in the EU market if better terms of trade are offered to competitors.

"Despite high tariffs, South American beef is already dominant in the EU market, thus we need to be aware that we are trying to maintain a niche position at best," Tweya said.

Namibia has secure market access in the SACU market, which is the largest market by volume, although not by value for beef, grapes and fish.

Another secure market, said Tweya, is the European Free Trade Area that consists of Norway, Switzerland, Iceland, and Lichtenstein for Namibian beef.

The deputy minister said preferential free trade agreements are now being negotiated with Mercosur, the southern common market - consisting of Argentina, Brazil, Paraguay, and Uruguay - as well as India.

Tweya said the ministry considers the greatest potential in the short term within Africa through the SADC FTA, and the recently launched discussions for the establishment of the tripartite FTA arrangement between Comesa, East African Countries, and SADC.

Another potential market he said is with China, which has signalled its readiness to conclude a key agreement on sanitary and phytosanitary measures that would facilitate agricultural products to China.

No company other than the departed Ramatex textile has made use of the African Growth and Opportunity Act (AGOA) that allows for preferential export tariffing to the United States, said Deputy Minister of Trade and Industry Tjekero Tweya.

The only company doing an effort to make use of the arrangement is the Omba Arts Trust (Mud Hut Trading) to export handicrafts.

Tweya said the extension of AGOA beyond 2013 to 2025 and the Third Country Fabric Concession hold promise for the revival of a textile industry in Namibia.

He said the country should embark on an aggressive investment promotion strategy to get investments for garment and apparel production.

Progress has been made on a joint market strategy of the trade and agricultural ministries to gain access into the US market for Namibian beef, bone-in mutton, lamb, and table grapes.

The ministry anticipates a breakthrough within six months to one year to enter the US market with those products, with potential for other goods to that market.

But Tweya said this would require an appropriate strategy of export promotions and market access negotiations to remove non-tariff barriers and technical barriers to trade to secure access.

Under the Doha round of negotiations in the World Trade Organisation (WTO), efforts are being made to construct a package for least developed countries on duty-free-quota-free market access, alongside simplified rules of origin, said Tweya.

This package will include a waiver in services commitments and aim to address cotton subsidies.

"These are areas where anomalies currently exist in the WTO and where developing countries are unfairly expected to make proportionally greater concessions in reducing import tariffs than other trading blocks," he said.