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Private sector urges restraint in signing EPA agreement

Vanguard (Nigeria) | August 02, 2007

OPS urges restraint in signing EPA agreement

By Franklin Alli

AS Nigeria prepares to host trade ministers from the EU (European Union) to discuss Economic Partnership Agreement between the EU and the African, Carribean, and Pacific(ACP) countries next month, the Organised Private Sector (OPS) has urged restraint in signing the pact. OPS has also declared its intention to be involved in the talk.

This was their position during a forum entitled ‘Organised Private Sector workshop on Developing National Position on the Economic Partnership Agreement (EPAs),organised by the Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA) and Trade Network Initiative, and sponsored by Oxfam GB Nig.

Captains of Commerce and Industry at the forum who provided in-depth and critical analysis on the would-be impacts of the EPAs, warned that the proposed trade agreements are not in the best interest of the growth of industry in the country. OPS should not be left out of the parley.

OPS believes its input will properly guide government decision on whether or not the country should be a signatory to the agreement.
“Government should not rush into signing the EPA Agreement until the existing wide gaps in the level of economic development between and among the negotiating groups are addressed for mutual benefit to all parties concerned,” said NACCIMA President, Dr. Ignatius Adaji.

“EPAS if not properly handled will kill local economy. Ordinarily the partnership does not appear to be bad but in-depth look indicates EU on the high side while ACP countries on the low side,” said Chief Joe Ifejika, Director of Field Services Manufacturers Association of Nigeria (MAN).

The Director General, Nigerian Employers Consultative Association (NECA), Mr. Segun Osinowo, in his submission, stated that opening our domestic market to foreign competition will cause many of our businesses to go under. This, he said is especially necessary, as most of our negotiators do not have the requisite capacity to carry out these negotiations. Represented by Mrs. Uche Ajaegbu, the NECA DG, said the agreement should be carefully managed in order to protect our local industries from the influx of fake or substandard products.

According to the Chairperson Trade Network Initiative (TNI), Hauwa Mustapha, trade relation between EU and ACP countries is unequal partnerships. She noted that while manufacturing firms in the EU are stronger and vibrant, the same can’t be said of a developing economy like Nigeria where manufacturing sector is still wobbling.

Meanwhile, the current round of EPA negotiations has been sparked by the expiry of previous trade agreements between the EU and ACP countries. Since 1975, political and economic relations between the two blocs have been governed by a series of five-year Lome Conventions.

The last Lome Convention came to an end in 2000, and was replaced by the Cotonou Partnership Agreement, which had the principal objectives of reducing poverty and promoting sustainable development of ACP countries and their gradual integration into the world economy.

Under the Cotonou Agreement, the EU and ACP countries agreed to maintain the Lome preferential system until the end of 2007, and then to replace it with a new Economic Partnership Agreement that would be WTO compatible.

Under the World Trade Organisation rules, both parties must liberalise, with the ACP being required to give duty-free access to all EU exports.

So from January 2008, ACP countries must open their own markets to direct competition from highly competitive EU goods and services. Under the proposed EPAs farmers and producers in ACP countries will be forced into direct and unfair competition with efficient and highly subsidied EU producers, regional integration among ACP countries will be severely undermined, and ACP governments will lose substantial revenue along with many of the policy tools they need to support economic and social development.

Under the EPA, the EU through the European Development Fund (EDF), has pledged to disburse a total of 22.7 billion Pound assistance package covering 2008 -13 for all 79 ACP countries.

 source: Vanguard