Mwapachu upbeat on EPAs agreement

THE East African Community (EAC) last week signed a framework agreement as part of the economic partnership agreements (EPAs) talks with the European Union (EU) to ensure continued access to EU markets for African small farmers, says Dr Juma Mwapachu, Secretary-General of the East African regional body.

The framework agreement on trade in goods determines the reduction and eventual scrapping of tariffs on 81 per cent of EU imports entering the EAC market. This will happen in phases.

“We are made to play second fiddle because we are told the World Trade Organisation says ‘come January 1, 2008, no more preferential Cotonou agreement. Take it or leave it’.
“In such a situation, how are we going to access the EU market if we don’t have an arrangement to replace the Cotonou agreement?” Mr Mwapachu told a meeting of the Helsinki Process on Globalisation and Democracy in Dar es Salaam on Friday.

He was making these statements against the background of civil society organisations, arguing that the EU could have arranged for the extension of the waiver granted by the World Trade Organisation (WTO) for the re-negotiation of trade arrangements between Europe and its former colonies in Africa, the Caribbean and the Pacific (ACP).

The conclusion of the EPAs between the EAC and the EU was driven by the desire to ensure that African exporters continue to enjoy duty-free and quota-free market access into the EU and that they are not blocked from the market in January 2008, he said.

“Why is trade how it is today? Because the rich world still wants us to play second fiddle. Whenever we come with firm proposals, they want us to be on the receiving end," Mr Mwapachu said.

In an interview with IPS, Mr Mwapachu said the EU was ‘concerned’ about the 25-year transitional period for the liberalisation of African markets for EU imports which it had initially agreed to.

The EU’s insistence on reducing the period to 15 years constituted a stumbling block in the negotiations over the past few weeks.
Mr Mwapachu pointed to the importance of development aid to assist the East African states to create capacity for production and export in the face of the EU's various non-tariff barriers, such as sanitary and phyto-sanitary rules.

“We have infrastructure problems in Tanzania. There is little local production. The issue here is how we are going to build capacity for our small farmers to be able to export and grow competitively. One really hopes that the EU will allow the development component in the EPA to help address supply-side constraints."

“This is a very sad day for the future of the East African Community," said Dr Yash Tandon, Executive Director of the inter-governmental think tank South Centre in Geneva, with reference to the news that the EAC had signed the EPAs.

The EAC should have bought time to think through the implications of the framework agreement on trade in goods which it had signed.
Dr Tandon said Uganda and Tanzania are covered under the EU's Everything But Arms (EBA) trade agreement, so they would not have suffered any loss of market access if they did not sign the framework agreement.

Kenya could have demanded the Generalised System of Preferences Plus from the EU, a preferential trade agreement, which is available to a selected group of developing states, Dr Tandon argued.

“In my view they have been pressurised to sign this agreement, which will have serious implications. We have had no time to analyse these implications."
The aid charity Oxfam on Wednesday warned that the deal may spur revenue losses and unemployment.

Under the deal, Burundi, Kenya, Rwanda, Tanzania and Uganda will enjoy duty-free, quota-free access to the European Union for all products -- except sugar and rice -- from January 1.

Services and investments, which are not covered in the interim agreement, will be negotiated next year.
Oxfam International's EU Office spokesman Luis Morago lamented that the five east African nations signed the accord under pressure, opening up 80 per cent of their market to European products in 15 years.

“This agreement will oblige the East African region to remove 80 per cent of its tariffs on EU goods over 15 years, possibly more quickly, which could lead to unemployment and loss of vital government revenue that might otherwise be spent on health and education," Morago explained.

The deal will in particular aid Kenya's cut flowers industry, Tanzania's fisheries and the coffee and tea trade in all five nations.
“Despite concerns raised by many, including the IMF (International Monetary Fund) African civil society, trade unions and academics, the Commission has ignored possible alternatives and insisted on the deadline," Morago added.

“They have essentially forced the East Africans to choose between guaranteeing markets for their agricultural exports today, and maintaining a degree of protection to promote future industrial growth - which all developed countries have done in the past."
The EU is pushing EPAs with 78 nations in the African, Caribbean and Pacific group in a bid to clinch deals that replace the preferential accords.

The new deal is designed to help EAC countries develop while diversifying their economies and meeting WTO requirements that they allow some access to European goods and services, regional officials say.