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Lipenga warns on EPA

The Daily Times, Malawi

Lipenga warns on EPA

By Marcus Muhariwa

13 July 2007

Discussions to prepare Africa’s position on Economic Partnership Agreements (EPAs) with the European Union (EU) should not be approached as an academic exercise.

Minister of Trade and Private Sector Development Ken Lipenga said on Monday the process must be looked at in accordance with the needs of people in rural areas.

He was speaking in Lilongwe when he opened the Third Dedicated Session on services that Africa can offer to the EU in return for European investment in services in Africa.

Among other things the meeting, which attracted participants from about 16 countries, was aimed at discussing and analyzing Africa’s position on EPA.

EPA is a new preferential trade partnership countries in Africa—former British colonies—are expected to sign with the EU by December this year.

Under the agreement African countries are expected to open up their markets to developed countries in turn for more economic aid.

He said while discussions on services have tended to lag behind, trade in services was becoming an important ingredient of international trade recording the fastest growth and beginning to surpass trade in goods.

“This is confirmed by the fact that services account for 45 percent of gross domestic product (GDP) in low income countries, 55 percent of GDP in middle income countries and 70 percent in the high income countries,” Lipenga said.

Common Market for Eastern and Southern Africa (Comesa) Director of Trade, Customs and Monetary Affairs Charles Chanthunya said what will emerge from EPAs negotiations would shape the economic future of an entire generation in for the involved countries.

However, Chanthunya observed that it was important to remember that the outcomes of the negotiations would set the precedent for any agreement Africa would negotiate with other countries and regions like USA, Japan, China and India.

Chanthunya said the shift from trading in goods to services has several advantages for Africa, including bridging the distance to markets which has been a major obstacle for most countries in the continent.