Despite Euros 2B being dangled in front of their faces, Cariforum countries yesterday held out for a better deal with the European Union (EU) and while some differences were narrowed in a two-day Jamaica meeting talks are to continue on sugar and other thorny areas.
With no deal being hammered out, an end of year deadline was in jeopardy yesterday. Guyana was represented at the meeting by President Bharrat Jagdeo and Minister of Foreign Trade Dr Henry Jeffrey.
A Reuters report last evening quoted Jamaica’s Prime Minister, Bruce Golding, as saying at a joint press briefing between the European Union representatives and the Cariforum team that the talks with the EU had not been without difficulty.
Golding said “There are issues that we have to wrestle with, because while we are committed to substantially free trade, while we are committed to WTO (World Trade Organisation) compatibility, there are issues that we have had to discuss that have serious implications for our own economies within the region.” According to Reuters, the EU Trade Commissioner, Peter Mandelson said that, “The top line is that we are going to make this work; there is detail that we are still to hammer out.”
He added that, “What we were hoping to achieve was common ground, a narrowing of the gaps, a convergence between us on key outstanding issues in these negotiations and that is precisely what we’ve done.”
What the key outstanding issues are was not highlighted but development finance and transferring the benefits of the Sugar Protocol – which the EU has unilaterally denounced – have been cited as contentious issues. These issues were raised yesterday.
On Thursday, Barbados Prime Minister Owen Arthur had said that Cariforum (Caricom plus the Dominican Republic) was still working towards meeting the December 31 deadline for inking an EPA with the EU after which non-reciprocal trading arrangements with the European grouping would become void.
The EU has all along been saying that it expects the Caribbean to be the first region to meet the deadline.
The EU on October 2 signed an interim deal with the Pacific region until an EPA could be hammered out. The end of year deadline was no longer possible. “The EU and countries from the Pacific region have effectively given up on reaching a firm deal before the preferential trade agreements expire in January,” Reuters has reported.
Meanwhile, Reuters reported that West Africa was also in talks yesterday with EU trade officials seeking a deal with the EU in which the region hopes to keep its preferential commercial privileges for up to two years while it negotiates an EPA.
Two billion Euros
In a presentation to the Montego Bay meeting on Thursday evening, European Commissioner for Develop-ment and Humanitarian Aid, Louis Michel told the CARIFORUM heads of government and officials that some two billion Euros are available to the Caribbean region from the European Union covering twenty years through the current 9th EDF, the 10th EDF and the 11th EDF along with the Sugar Accompanying Measures
The sugar sector, he said, will receive a total of 350 million Euros for the period 2007 to 2010 and this assistance would be extended to the period 2010 to 2013.
Michel said that the EPAs processes run up to 25 years in some cases and all the accompanying measures would not apply in 2008. Cariforum had wanted these measures in place immediately.
He said, too, that the meeting on programming is to take place in Haiti in another two weeks time on the 10th EDF and the EU is open to ideas including the question of the fiscal impact of the EPA.
“With a view to neutralising the net fiscal impact,” he said, “We would reinforce the budget support option and include a chapter on the fiscal aspects in the EPA text.”
Michel felt the transition and disbursement of funds over a longer period was good because it was doubtful that “the absorptive capacity of the region could cope.”
The need, he said, would have to be programmed over a number of years and would also cover other resources such as the 11th EDF.
In total, he said that with the 10th and 11th EDFs and the sugar accompanying measures and then extrapolating these amounts over the period 2013-2020 he sees aid given to the region over a 20 year period to 2020 totalling two billion Euros.
The EPA, Michel said requires significant efforts of adaptation and restructuring on the part of the Caribbean in the short, medium and long term.
He summarized areas that progress has been made on.
On an agreement promoting sustainable development, he said that the EU has agreed to include in the text of the EPA a chapter entitled ‘Partnership for Trade and Development’ which identifies the potential areas of development cooperation required. He said that the Caribbean region and the EU have taken jointly mutual commitments on social issues, the environment and food security.
On substantial means to accompany the EPA process, which the region is seeking, he said, “These are available. And they are available rapidly. The range of community instruments available is impressive.”
He noted sums disbursed under the 9th EDF which included 76 million Euros to support regional integration and the establishment of the Caribbean Single Market and Economy (CSME), preparation of the EPA, and the development of the private sector; 680 million Euros to support the traditional sensitive products of the region.
He said that the banana industry restructuring has received substantial assistance and by 2008 this would have totalled 230 million euros over a ten year period (from 1999); the rum industry received 70 million Euros and the rice industry, 24 million Euros. Sugar is expected to receive a total of 350 million Euros for the period 2007 to 2010.
Michel said that the EU was making a bigger effort under the 10th EDF with the assistance to the Caricom regional programme allocation moving to 132 million Euros.
Michel added that he recently took the decision to increase the allocation by 25 per cent specifically for funding activities related to the implementation of the EPA. The Caribbean region, he said was the first region to benefit from this decision to allocate additional resources to address the needs related to the EPA.
In relation to additional funding to the EDF, he said that EU Member States committed themselves to reaching one billion euros per year by 2010, which is new money for trade related issues. In addition, he said that other EU institutions would support the EPA process.
On the need to ensure “the greatest possible efficiency in the delivery of aid”, he said he has insisted “on the significant increase of the use of budget support as a delivery mechanism.” Eleven out of 15 countries in the region are benefiting from budgetary support, representing 57% of national allocations.
He said, too, as he has said before that a regional development fund be used as a channel of funding to cater for rapidity and additionality (through the support of other donors).
The meeting was called to try to resolve issues which could delay the completion of the negotiations for the EPA in keeping with an agreed schedule.
Previously, exports from Caribbean and other ACP countries have enjoyed non-reciprocal preferential access into the European Union under successive Lom
