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Trade talk deadline closer, but EU and SADC far apart

The Namibian, Windhoek

Trade Talk Deadline Closer, But EU And SADC Far Apart

By Brigitte Weidlich

9 July 2007

Trade negotiations between Southern Africa and the European Union are progressing slowly and some sectors might not even be agreed on by the end of the year, when the signing of the trade agreement is to take place.

"We don’t want to be made to choose between access for our goods to the EU and regional integration in southern Africa," Andrew Ndishishi, Permanent Secretary at the Ministry of Trade and Industry said.

All world trade among states must be compatible with the rules of the World Trade Organisation (WTO).

The European Union however obtained a waiver from the WTO until December 2007 for its separate trade agreement it concluded several years ago with countries of Africa, the Caribbean and the Pacific (ACP), among them Namibia.

Due to the looming deadline, the EU has to adjust its trade agreement with the ACP countries, called the Cotonou Agreement, to bring them in line with the WTO.

The Cotonou Agreement has allowed ACP countries non-reciprocal market access to EU member states at preferential tariffs since the year 2000, meaning ACP did not have to give EU products market access in return.

This will change from January 1, 2008 because the EU now wants access for the goods and services offered by their member states to ACP countries.

The prevailing fear is that the EU might swamp ACP with their goods.

Trade negotiations with African countries are multi-faceted since the different regional trade blocs like Ecowas for West Africa, Comesa (Common Market for Eastern and Southern Africa), the Southern African Development Community (SADC) and the Southern African Customs Union (Sacu) require separate agreements.

Namibia is one of the 14 SADC member states, but also belongs to Sacu together with Botswana, Lesotho, Swaziland and South Africa, which are also SADC members at the same time.

Another facet to the proposed Economic Partnership Agreements (EPAs) to be completed by December is that South Africa has concluded a separate Trade and Development Cooperation Agreement (TDCA) with the EU.

Although all EU-ACP trade partners knew about the looming deadline, proper discussions with southern African countries and the EU only started in earnest last month.

"The first official round of talks took place between 17 and 23 June with EU representatives at Walvis Bay," Ndishishi told reporters last week.

"The other four members of Sacu now have to formulate tariff offers to the EU, which in reality means to reduce and eventually eliminate import tariffs for EU goods in order to match what South Africa already did under its separate TDCA with the EU," Ndishishi outlined.

"Regional economic integration (at SADC level) would however be undermined if Sacu countries are to be differentiated and requested to offer different market access to EU countries," Ndishishi added.

"With regard to Namibia’s fish exports, our Government aims to achieve an agreement that enhances market access to Europe, while not risking our marine resources.

Namibia is ready to liberalise tariffs for EU fish products to our country."

The different categories to be negotiated are trade in goods, the rules of origin of goods, sanitary and phyto-sanitary standards and regulations for fresh produce like table grapes and trade facilitation.

New sectors are ’new generation trade’ and ’trade in services.’ According to Calle Schlettwein, Finance Permanent Secretary, this includes the service industry, Internet Protocol (IP), which is a protocol for delivering data across networks and telecommunication.

"Trade in services includes public procurement and eventually EU companies would be able to tender in the SADC region to supply goods to Governments and state-owned enterprises " Schlettwein said.

This would however have a negative impact on the Black Economic Empowerment (BEE) procurement policy of Namibia currently being drafted.

"There is a possibility to negotiate the new generation trade issues at a later stage and first conclude EPAs on trade in goods regarding tariffs, rules of origin, sanitary issues and trade facilitation by December."

Two more discussion rounds are planned between now and the end of the year.