Peter Mandelson, the European Commission trade commissioner, urged Africa Caribbean and Pacific (ACP) countries to ramp up the signing of the economic partnership agreements (EPAs) in a bid to duck-out from the legal wrath of the World Trade Organisation.
Speaking to journalists at European Commission headquarters on Wednesday, he said while the initialling of the agreements was an important step now, there is a need to speed-up the signing so that it becomes a binding legal document.
“If we do not do anything by summer, others are going to ask the legality of the agreements. We have to do so before we get challenged in Geneva,” he said.
The EU has embarked on a marathon new trade negotiations with the 78 poor members of the ACP which is aimed at having a reciprocal trade arrangement known as EPAs. The move is aimed at having all goods from ACP countries entering the EU market duty and quota free while in return EU goods will have access to the ACP countries. Further, the move is expected to stimulate trade among the ACP countries as trading rules will be simplified. That alone results in increased trade, investment with the long term view of creating jobs and alleviating poverty.
So far, 18 African countries from central, eastern, southern and West Africa have initialled the agreements. Within the SADC region, Botswana, Lesotho, Mozambique, Namibia and Swaziland have initialled the agreements. However, Namibia has raised some objections as it tries to protect its infant industries which are in the diamond polishing and uranium development. It has since been told to bring its complaints through SADC- rather than coming to EU as a country.
“We are negotiating with a region not a country. We told them that that they should bring their concerns through SADC,” Evanos Casella, EU chief negotiator with SADC told Sunday Standard in an exclusive interview on Monday in Brussels.
He added: “We can negotiate with them alone. We are not going to re-open negotiation for them and we can give them a deal which is different from others.”
South Africa, which is the economic power house in the southern African region, has not initialled the agreement prompting concern that its decision threatened the regional integration which is the foundation of SADC. And further in West Africa, Nigeria has refused to initial the agreement, which has resulted in it reverting to the GSP arrangement, where they pay high duty for their goods to enter the EU market. The move has battered its small coco producers who make a leaving by exports to the EU markets.
“We tried to ensure that nobody falls into GSP,” Mandelson said as he urges the rest of Africa to move to the next step.
“It is important to move from initial agreement to signing of an agreement. If we do not, others will challenge us in Geneva and they will win,” Mandelson’s advisor, Peter Hill, said.
EPAs negotiations started some seven years ago as the Geneva- based organisation WTO started to define the new rule of international trade. EPAs will, in the initial stages, ensure that sensitive industries in the developing countries are protected until they have come of age. WTO’s free trade regime will start in 15 years, when trade without reciprocity will be viewed as illegalÔÇö a move which led to the phasing-out of preferential treatment which was enjoyed by Botswana beef for ages.
Part of the EPAs is to ensure that meangful investment is created in the developing countries something which preferential treatment had failed to address.
“We have taken long in these negotiations because some countries wanted to take their time. But now, we do not have time and we have no alternative,” Mandelson said.
Meanwhile, SADC countries which have initialled the agreements are expected to engage the EC next month in Europe’s capital, Brussels, in a bid to pave the way for the signing. The negotiations will be centred on discussing issues related to services and investment and will cover areas such as intellectual property rights and competition policy as the region prepares to be locked into the international economy.
Officials at the European Commission said this will be an important step but also urged the ACP countries to make their physical frame-work to be investor friendly because the services sector, such as insurance, banking and call centres, might be interested in investing in countries with low wages. But there is a challenge of skill development.
The EC further urged the regional trading block to create some funds which will address challenges which will be identified during the negotiations for the developing countries to be investor friendly.
Meanwhile, the Caribbean region has already signed the agreements, a move that will mean that they can gradually open their market to the EU.
“We need to widen and deepen the market. The Caribbean deal promotes investment, business and meets international standards,” Mandelson said, pledging that they would protect the sensitive industries.