The European Union (EU) demand for duty-free access for substantially all its exports to Cariforum countries is among the sticking points in trade talks between the two sides and this and the recent scrapping by the EU of the Sugar Protocol could feature at the Commonwealth Finance Ministers meeting this week.
An Economic Partnership Agreement (EPA) was not reached at the just concluded meeting of Cariforum Leaders with EU Trade Commissioner Peter Mandelson and EU Development and Humanitarian Aid Commissioner, Louis Michel in Montego Bay, Jamaica last week but the gaps in negotiations have been lessened they reported to the media.
Member of Parliament and former Jamaican Minister of Foreign Affairs and Foreign Trade, Anthony Hylton said that other sticking points he sees are “a failure or refusal” of the EU to identify or negotiate the level and terms of the financial resources to be provided for the related adjustment and implementation cost of the EPA; the EU failure to provide treaty assurance that the level of financial and technical assistance traditionally provided for broad-based development would not be adversely affected (assurance that resources provided for the EPA are additional and not merely a reallocation); and the EU’s effort to use the EPA negotiations to force a widening and a quickening of the pace of integration in the Caribbean.
Writing in the October 5 edition of the Jamaica Gleaner, Hylton, one of the regional experts who negotiated on behalf of the African, Caribbean and Pacific (ACP), the Cotonou Agreement said that “There was a clear and explicit understanding between negotiators that the EPA should be a market building instrument for the ACP. It was not a market opening or market penetration instrument for the EU. This was clearly stated by the then and still current Development Minister of Germany, for the EU, and myself for the ACP.”
Hylton said that the issue of trust was now playing a weakening part for successful negotiations because of the EU’s reinterpretation of the Cotonou Agreement, the slow pace at which resources were made available for the analyses of the potential impact of the proposed EPA, the treatment of major commodities, such as sugar and bananas, and the threatening approach to the negotiations.
In the negotiations, particularly for CARICOM countries, he said, there were implications in the EPA it concludes with the EU for any trade negotiations it might conduct subsequently with the United States and Canada, as well as current negotiations in the World Trade Organization. Important, too, were continuing the relationship with the ACP group and the ACP-wide arrangements which would be needed for the full implementation of the EPA.
Here it should also be noted that other developed countries are looking on at the negotiations involving the EU and the five other regional groupings as they too would not want to miss out on any trade benefits in what they would consider their backyard such as Australia and New Zealand and the Pacific countries.
In June this year, Australian Trade Minister, Warren Truss indicated Australia would fight to gain equal access to Pacific markets as it was in Australia’s and New Zealand’s interest that any new deal that South Pacific countries may do with the EU does not disadvantage Australian exporters to those same countries.
And while the EU has signed an interim agreement with the Pacific region in anticipation of the December 31 deadline for WTO compliance, Reuters reported out of Brussels on West Africa’s attempt to go same route where Peter Power, spokesman for the EU Trade Commissioner said that “It is a WTO imposed deadline. We are governed by international rules and we intend to stick to them. Our waiver expires at the end of this year and we need a successor regime by the end of this year.”
Back in the Caribbean Hylton, like commentator David Jessop out of Europe, was critical of the meeting between the Cariforum heads and the commissioners, advising the heads to stay with precedent. Jessop felt that “In most trade negotiations, the final and political part of the process is assigned to ministers rather than Heads of Government.” Hylton felt that the Cariforum Heads of Government could not commit themselves in a situation where European Heads could renege on commitments made by the EU commissioners.
Speaking about Mandelson’s threat of entering into new trading arrangements by year end, or, otherwise “there would be no legal basis for the extension of existing preferential trade terms between the EU and the 78 (ACP) countries if the two sides do not initial new (EPAs) before the end of 2007”; that “former European colonies could miss out if they do not sign up to new trade deals”; and that “those who relied on exports of goods such as bananas and fish faced a risk to their livelihoods,” Hylton said that, “the non-reciprocity was not given, it was negotiated.”
Hailed
The treaty, he said, was negotiated in 1975 and restated on five occasions since. In 1975 the ACP, led by former Prime Minister, then Foreign Minister, P.J. Patterson, negotiated a trade agreement as part of the wider Lome 1 Convention, with the European Economic Community in which the EEC granted tariff-free entry to ACP Exports without reciprocity.
The trade components of the Lome 1 Convention, he recalled, were hailed universally as a model for trade agreements between developed and developing countries. Europe was seen as a pioneer and trailblazer. “To threaten to unilaterally abrogate this agreement is an indication of how far Europe has retrogressed in its support for real development.”
Hylton added that, the ACP should not be surprised, “since the EU had also served notice to unilaterally terminate the 32-year-old sugar protocol under which its sugar refineries and consumers were the original and substantial beneficiaries