Ethiopian Review

Addis Ababa — The European Commission (EC) has set plans to complete the Economic Partnership Agreement (EPA) negotiations with Africa, Caribbean and Pacific countries (ACP) by the end of 2009, or the beginning of 2010.

In September 2002, the European Union and the ACP countries officially opened negotiations on Economic Partnership Agreements (EPAs) in Brussels. The EPA is a trade agreement that defines trade and development relations between Europe and ACP countries.

Celine Idil, Coordinator for the Eastern and Southern Africa EPA at the EC told Capital that the commission aims to complete the preliminary signing agreement within the next couple of months.

She said that from the 11 countries in East Africa, five countries, including Ethiopia, have not signed the EPA and are currently in negotiations. According to the coordinator, negotiations are going smoothly currently and it is hoped they will be completed by the end of 2009, or by the beginning of 2010.

The EPA was first scheduled to be concluded in December 2007, but was extended as some countries in the regions rejected the agreements.

The Ethiopian Minister of Trade and Industry Girma Biru some weeks ago told Ethiopian parliament that signing the EPA is not a priority at present for the country because Ethiopia is sending its products to European countries under the Everything But Arms deal signed with Europe.

According to the minister, Ethiopia would not lose or gain anything by signing the EPA at present and is not contemplating signing the deal in the near future.

The import duty currently is set at zero under the Generalised System of Preferences from which Ethiopia is benefitting.

Experts have been criticising the negotiations as this has been a negotiation between two unequal partners: the EU on one hand and the ACP countries on the other. According to some experts, some of the outstanding issues that needed to be settled before the conclusion of the EPA are development issues, supply-side constraints, infrastructural facilities, capacity building, regional integration and adjustment cost of liberalisation.

The European Commission holds that existing EU-ACP trade relations, where the EU grants extensive non-reciprocal preferences on a discriminatory basis to the ACP states, must be made WTO-compatible. This, according to the commission, will require the dismantling of barriers on substantially all trade between the EU and the various ACP groupings, so that trade preferences become reciprocal, ultimately to create a series of effective free-trade agreements. By dismantling these trade barriers with the EU, the EPAs are to provide a stimulus to the extensively closed ACP economies to actively integrate into a growth priming, WTO-governed, liberal trading regime according to a recent research paper presented on the impacts of the EPA.

The commission also believes that in creating a free trade area within each ACP region, the EPAs will provide a stimulus to fledgling regional integration efforts and in particular will contribute to the building of viable regional markets, which in turn will stimulate investment and promote intra-regional trade.

On the other hand, the ACP Council of Ministers complains of the disconnect between the public statements of the Commissioners for Trade and Development on the development aspect of the EPAs and the actual position adopted during EPA negotiating sessions.

ACP officials also protest that EC negotiators are effectively imposing the precise trading terms of the EPAs, with little or no scope for consideration of alternatives, or of the appropriateness of these terms for particular regions and countries.

- By Groum Abate | Capital Ethiopia