By Emma Kakololo
Africa and the European Union may have to settle for some temporary trade agreements come January 2008 because of the stance taken by both parties in the Economic Partnership Agreements (EPAs) negotiations recently.
“We may just focus on agricultural and manufactured products for the time being with the African countries,” an assistant of the EU Trade Commissioner, Stephen Adams, announced last Tuesday.
EU Trade Commissioner responsible for the EU’s external trade Peter Mandelson told the Committee on International Trade (INTA) last month that it was impossible to conclude EPAs by the end of this year.
Mandelson said negotiations with the Caribbean and Pacific countries were far advanced compared to the Eastern and Southern African (ESA) countries.
“It is also possible that in some regions, not every member country will be able or willing to sign an agreement now.
“So where, some within a region have real concerns about securing their EU market access, and where they propose World Trade Organisation (WTO)-compatible agreements, we will try to respond constructively to those countries.”
He urged the meeting to decide whether they will have to look “in these cases at stepping-stone agreements covering goods only or whether more comprehensive EPAs are possible with some groups of countries within regions”.
“We will propose a Council regulation allowing us to implement the new trade regime from 1 January for those who qualify. This should be launched in November and adopted in December,” he said.
“We will need to be pragmatic, to recognise different regional needs and interests, as well as those with particular vulnerability among the ACP, while keeping our overall objectives in mind,” he urged.
The possibility of not concluding the EPA negotiations by the end-of-year deadline is of significant concern to Namibia, Botswana and Swaziland – the states in the SADC EPA group not categorised as least developed countries (LDCs). The non-LDC categorisation excludes them from access to European markets as part of the “Everything but Arms” initiative. This means they are expected to enter into new contractual, reciprocal free trade agreements in the form of EPAs to be compatible with WTO rules.
Namibia stands to lose around N$675 million per year at the end of the current EU preferences. This amount is equivalent to more than four times the money Namibia receives annually under the 9th European Development Fund, according to Mareike Meyn of the Overseas Development Institute (ODI).
Namibia’s agricultural exports focus on the EU market and are built on EU preferences with 44 percent of exports in the meat industry, 70 percent of grape production and 60 percent of fish destined for the EU market.
In the medium term however, higher costs are anticipated, as meat exports are likely to face tariff increases of up to 130 percent, which is equivalent to 65 percent of total sales revenue.