Meat Exporters in a Panic over EU

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By Wezi Tjaronda WINDHOEK Namibia’s meat export sector wants to get the SADC Economic Partnership Agreement (EPA) negotiations with the European Union finalised before the end of 2007 for it to continue accessing the EU market duty and quota free. “There is no plan B. Our objective is to get something written down as part of this dispensation,” Trade Advisor to the Agricultural Trade Forum (ATF) Jurgen Hoffman told the press on Friday. The sector, which includes the ATF, the Meat Board and Meatco last week gave their official position after Meatco’s market researcher Wallie Roux criticised the European union for using “carrot and stick tactics” to get SADC-EPA members to sign the agreement by end of 2007. Roux has since been suspended for “breaking Meatco’s internal rules” according to Chief Executive Officer, Kobus du Plessis. Roux criticized the EU among other things of taking 11 months to respond to the SADC-EPA Framework proposals and at the same time wanting the configuration to sign a comprehensive agreement before year-end. He also said the playing fields were not level to fully constitute equal partnership as required by the EPA agreement. Although it took close to one year for the EU to concede having South Africa as a full negotiating partner, it also took two years for SADC to realise it could not negotiate with South Africa. They said the sector is positive on trade with the markets of the EU, adding that the articles critical of the EU offer had given the impression that this was the official position of the Meat sector, stating that the importance of the EU markets for Namibia’s meat export trade had never been and would never be doubted. With the ceasing of the World Trade Organisation (WTO) preferences for trade under Cotonou at the end of this year, the affected countries, which include Namibia, can however agree to negotiate Economic Partnership agreements to qualify for the EU’s offer to eliminate tariffs and import quotas for ACP countries, giving all these countries the same full market access to the 27 EU countries that all least developed countries (LCDs) in this group and elsewhere already have under the EU’s Everything But Arms (EBA) regime. The EU offer for duty and quota free access for all Namibian exports to the EU markets said the meat sector is a big advantage and put Namibia in a favourable position compared to some of its competitors in the meat trade with the EU. The offer, said the three organizations, has strengthened the resolve of the agricultural trade export sector to support the negotiations to come to an acceptable solution. This is applicable to both duties payable for entry into the EU markets and also the zoo sanitary measures, food safety and animal welfare requirements. Du Plessis added that the “EU was very supportive of the industry in Namibia and the EU has been a very good friend. The offer was made in good faith and it should be welcomed by all.” Namibia is currently negotiating an EPA as member of the SADC-EPA configuration, which includes South Africa, Botswana, Namibia and Swaziland as well as four least developed countries (Angola, Mozambique, Lesotho and Tanzania). In case no agreement is reached by the end of 2007, Namibia will not only lose its preferential market access to the EU, which may cost the country 45 million Euros or approximately N$675 million, but also face discrimination compared to its competitors in the EU market. This amount, according to a study that was done by the Overseas Development Institute to evaluate the economic and social impact of the end of the current EU preferences, is four times the money that Namibia gets from the EU in development aid. The best non-negotiated regimes that the EU offers to developing countries include the General System of Preferences (GSP), which will lead to the losses and meat exports. Other alternatives include GSP+, which is available to countries that apply and meet the vulnerability and ratify and implement 27 international conventions on human and labour rights, the environment and good governance. But Namibia does not qualify for this provision because it did not apply in time, according to Hoffmann. Since the GSP is the only secure alternative for Namibia’s exports from January 2008, the ODI in its analysis of the costs, competitive situation and social implications of the current losses of preferences on grapes and meat found that most of the amount that Namibia will lose will be borne by meat exporters which would face the tariff increases of 63 to 132 percent and additional duties equivalent to 65 percent of the 2005 revenue obtained in the EU market. The preferential access to the EU market has also enabled Namibia to upgrade its facilities to meet international standards and if Namibia lost the competitive advantage to supply the EU, it might no longer be able to supply valuable niche markets such as South Africa. Hoffmann said the social implications of the end of preferences would be highest as it would affect the livelihoods of 3 000 farmers in the northern communal areas who benefit from the stable prices offered by Meatco. The loss of preferences is likely to influence the country’s foot-and-mouth disease status negatively and in turn endanger the entire industry. The country has also exploited a niche market for its grapes, which provides an income for 16 000 people who would be affected.