EC Signs Economic Partnership Agreements With 35 Countries in Africa, Caribbean, Pacific
The European Commission's delegation to the U.S. reports that as of mid-January 2008, 35 countries of Africa, the Caribbean and the Pacific (ACP) had signed either interim or full Economic Partnership Agreements (EPAs) with the EC. The EC intends to upgrade the interim agreements into comprehensive EPAs throughout 2008.
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According to an EC press release, the EPAs eliminate European Union (EU) duties and quotas for all products (other than short transition periods for sugar and rice) and provide security for traders and investors with no more waivers, time limits or periodic renewals. The EPAs also require gradual trade liberalization in ACP countries, generally over 5 to 25 years. Unlike the system they replace, the EC states that the EPAs meet World Trade Organization (WTO) rules.
EPAs Replace Non-Reciprocal Preferences Which Expired January 1, 2008
The EC delegation explains that non-ACP countries successfully challenged the EU's non-reciprocal trade preferences for ACP countries in the WTO. Therefore, the EPAs were necessary to comply with WTO rules on non-discrimination. A seven year WTO waiver ended at the end of 2007.
ACP countries without EPAs reverted to GSP benefits. Except for Least Developed Countries (LDCs), ACP countries that did not sign EPAs reverted to the EU's standard Generalized System of Preferences as of January 1, 2008.
LDCs still benefit from "Everything but Arms." The 32 ACP countries that are LDCs are still receiving full access to European markets through the "Everything but Arms" agreement introduced in 2001 to give duty-free and quota-free access for all products to LDCs, with the exception of arms and munitions and with delayed benefits for sugar, rice, and bananas. (See ITT's Online Archives or 01/12/06 and 03/05/01 news, 06011220 and 01030260, for BP summaries related to "Everything But Arms".)
EPA Rules of Origin Etc. Meant to Encourage ACP Development, Exports to EU
According to the EC press release, the EPAs have rules of origin specifically negotiated to support the development of ACP industries that import materials to make goods for onward export to Europe, particularly in key sectors like textiles, fisheries and agriculture.
The EC states that this is one reason a number of LDCs signed EPAs, even though they already benefited from duty and quota-free market access under "Everything But Arms."
Full EPA Signed With Caribbean Countries
On December 16, 2007, the EC initialed a full EPA with Antigua and Barbuda, Bahamas, Barbados, Belize, Dominica, the Dominican Republic, Grenada, Guyana, Haiti, Jamaica, Saint Lucia, Saint Vincent and the Grenadines, Saint Christopher and Nevis, Surinam, and Trinidad and Tobago (CARIFORUM countries).
The EC states that the EPA covers all provisions necessary for a free trade agreement, such as provisions on import and export duties and charges, non-tariff measures, trade defense instruments, a protocol on rules of origin, etc.
Goods covered. The EC states that the coverage of goods liberalized by CARIFORUM countries under the EPA amounts to 61.1% of EC imports in value over 10 years, 82.7% over 15 years (85.1% of tariff lines) and 86.9% over 25 years (90.7 % of tariff lines). The main exclusions are agricultural and processed agricultural products; some chemicals, furniture and other industrial products.
Interim EPAs with Certain African Countries, Negotiations to Continue
The EC has also initialed interim EPAs with the Southern African Development Community (SADC), the East African Community (EAC), and with Seychelles and Zimbabwe of the Eastern and Southern Africa (ESA) region.
The EC states that the interim agreements cover market access and other areas including development cooperation. The interim agreements do not (yet) cover all of the provisions necessary for free trade agreements, such as non-tariff measures, trade defense instruments, special provisions on administrative cooperation in customs matters, a protocol on rules of origin, etc.
Goods covered. These interim EPAs remove all remaining tariffs and quotas for all exports from the signatory ACP countries, effective January 1, 2008, with transition periods for rice and sugar. The interim EPAs call for gradual liberalization of the participating ACP countries taking place over many years.
(See ITT's Online Archives or 12/28/07 news, 07122899 3, for BP summary of the possibility of certain African nations losing their EU trade benefits if EPAs were not signed by December 31, 2007, with a link to BP summary on the signing of an interim EPA with East African countries.)
EU delegation to the U.S. "eufocus" (dated March 2008) available at http://www.eurunion.org/News/eunewsletters/EUFocus/2008/EUFocus-Trade&DevMar2008.pdf
EC press release (MEMO/08/15, dated 01/11/08) available at http://europa.eu/rapid/pressReleasesAction.do?reference=MEMO/08/15&format=HTML&aged=0&language=EN&guiLanguage=en