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’No postponement of EPA deadline’ - EU

Inter Press Service (Johannesburg) | 19 October 2007

’No Postponement of EPA Deadline’ - EU

By David Cronin

The European Union has rejected calls by West African states to postpone the end-of-year deadline for concluding a free trade agreement.

Earlier this month, West African governments urged the EU not to insist that the proposed economic partnership agreement (EPA) be finalised by the deadline of December 31.

Ablasse Ouedrago, a leading trade official with the Economic Community of West African States (ECOWAS), said the region "is not ready" to sign such a trade liberalisation deal at this stage, reflecting concern that impoverished farmers and nascent industries would be severely damaged if they had to compete with an influx of cheap goods from Europe.

As an alternative to an EPA, West Africa has asked that current preferences granted by the EU to imports of their goods should be maintained for up to two years. While those preferences enjoy a waiver from rules set by the World Trade Organisation (WTO), the exemption will expire at the beginning of 2008.

The EU’s executive, the European Commission, has refused to accept the West African request that it seek WTO approval for an extension of the waiver.

In a letter, seen by IPS, the Commission claimed there would be "no legal basis" to do so, arguing that moves in that direction will tarnish the reputation of both the EU and West Africa.

"We are now at the end of a road and requesting a waiver would change our credibility internationally," read the letter, signed by Peter Mandelson and Louis Michel, the European commissioners for trade and development aid respectively.

"We have had seven years to conclude the EPA negotiations. The European Commission cannot maintain illegally a regime which we jointly promised to bring to an end seven years ago," according to the letter.

The trade preferences are contained in an agreement concluded in 2000 in Cotonou, Benin, between the EU and almost 80 African, Caribbean and Pacific (ACP) countries. According to Mandelson and Michel, any effort to prolong this deal will be challenged by poor countries outside the ACP bloc.

Latin American banana producers, for example, are unhappy with the preferential market access that the EU has given to fruit grown in the ACP. The banana preferences "risk being outlawed" by the WTO next year, the commissioners said.

Dated October 11, the letter has been sent to 16 governments, including those of Ghana, Nigeria, Burkina Faso, Ivory Coast, Mali and Benin.

Yet, despite ruling out the West Africans’ request, the commissioners have indicated that they would be willing to sign a less ambitious EPA than the one they had previously sought.

The letter states that, "as a minimum", a deal relating to trade in goods should be completed this year. This would be a "stepping stone towards a full EPA", the commissioners added, "for which negotiations would continue in 2008".

Until recently, the EU side has argued that EPAs covering a wide range of issues should be concluded by December 31. Along with trade in goods, the topics put forward by the Commission had included services liberalisation, competition, investment, government procurement and intellectual property.

Anti-poverty activists believe, nonetheless, that a deal limited to trade in goods could hinder social and economic progress in the ACP.

"A goods agreement could force undesired liberalisation," said Alexander Woollcombe, an EU advocacy officer with the international non-governmental organisation Oxfam.

"The deadline shouldn’t be used as a pressure point to get ACP countries to sign something that doesn’t serve their long-term interests. The priority should be on getting things right, rather than just having some sort of deal by the end of this year," he argued.

Mariano Iossa, a trade campaigner with the international non-governmental organisation ActionAid, labelled an accord on market access for goods as an "EPA-lite".

He alleged that because small-scale farmers may not be able to shield themselves against imports from Europe, they risk being unable to feed their families. This would undermine guarantees on freedom to hunger enshrined in the 1948 Universal Declaration on Human Rights, he suggested.

"This type of agreement would not address the concerns of producers in the agricultural market, the main source of livelihood for the large majority of farmers in Africa," he said. "And it wouldn’t address the question of how the right to food would be violated."

West Africa is one of four regions in Africa involved in EPA negotiations. The others are Central Africa, Eastern and Southern Africa and the Southern African Development Community (SADC).

Although Mandelson has signalled that Central Africa could sign an EPA covering both goods and services, doubts have been cast about whether the remaining regions would do so.

IPS has reported that Rob Davies, the South African trade and industry deputy minister, said recently that his country was not willing to "roll over" and accept an accord that was incompatible with SADC’s development goals.

He said that SADC members wished to build up their services so that they would be able to compete with those in Europe before agreeing to liberalise them, indicating his anger at EU efforts to enable foreign firms to invade Africa’s transport, telecommunications and financial sectors.

Meanwhile, the Eastern and Southern African region has focused largely on trade in goods and on development issues during recent negotiations. Less attention has been paid to the other thematic "clusters" in the talks, which cover topics like services and fisheries.

The EU’s 27 governments agreed on a strategy on October 15 which involves spending 2 billion euros in annual "Aid for Trade" by 2010. About half of this assistance will be used to help ACP countries adapt to free trade, the governments declared.

But Berhane Gebre-Christos, Ethiopia’s ambassador to the EU, said that the development dimension of the EPAs is wider than the "Aid for Trade" dossier. Many ACP countries have not been able to take full advantage of preferences offered by the EU because of capacity constraints, he said, arguing that these shortcomings need to be addressed in the negotiations.

"If we undertake reforms, there will be a cost to it and that has to be covered. This requires resources," he told IPS.

"There is a political commitment on the part of the ACP in general to sign EPAs this year," Gebre-Christos added. "People are open-minded and willing to conclude the deals but what we actually achieve will depend on the outcome of the negotiations.

"It is very difficult to say now what the conclusion will be. There are a number of issues on the table that have to be sorted out."