Ethiopia and EPA Negotiation 2008 - FES Ethiopia

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No Interim EPA Djibouti, Somalia, Eritrea, Ethiopia, Sudan, Malawi, chemicals, plastics and rubber articles of leather and fur skins, iron & steel and consumer electronic goods 19 Both EAC and ESA Interim Agreements remain open for others for accession and include a commitment to the conclusion of a comprehensive EPA in 2008 (by July 2008 in the case of the EAC and December 31 st 2008 in the case of ESA countries). Zambia is a unique case. It has initialled the ESA framework agreement in order to benefit from provisions on fisheries and development cooperation. However, no market access offer was agreed upon between the country and the EU. Zambia has been exporting to the EU under the EBA regime since 1st January 2008. Malawi is expected to join the ESA EPA in 2008, although the Malawian civil societies have called on the government to rely on the EBA arrangement. An interesting question that arises here is: why are the East African LDCs sign the Interim EPA? Along Lesotho, Mozambique, Madagascar and Comoros, the EAC LDCs are the only LDCs that chose to join the agreement, liberalizing further than the 80% liberalization the EU felt is necessary to defend the Interim agreements at WTO. The East African LDCs, i.e., Uganda, Tanzania, Rwanda, Burundi have already committed to have a common external trade regime under the East African Community. If, under EPAs, the East African Community has different trading regimes with the EU with Kenya signing the Interim EPA as a developing country and the rest maintain the EBA preference, then such a situation would undermine the foundation of Community and lead to its demise. The East 19 This is a slight variation of excluded products for other Indian Ocean signatory countries. Zimbabwe’s excluded products included: products of animal origin, cereals, beverages paper, plastics and rubber, textiles and clothing, footwear, glass and ceramics, consumer electronic and vehicles. 14 | P a g e
African LDCs signed the Interim EPA along with Kenya in order not undermine the integrity of the Eastern African Community. If each country had entered into a different deal with the EU, the Customs Union would have splintered and considering that the community is still at a relatively nascent stage, it is possible that the Customs Union would have survived such a fragmentation. 20 For Uganda at least, there is also a belief that “EBA has no commercial sense for exporters given their high degree of association with Kenyan firms’’ 21 and hence the decision to sign the Interim EPA with the rest of the East African Community members. For LDCs such as Lesotho and Madagascar, the reason for signing might be the desire to benefit from the more generous rules of origin in textile export and to reserve the right to incorporate Far East fabrics in selling to Europe as they have been doing to the United States. Both the EAC and ESA Interim Agreements effectively remove all quantitative restrictions, and grant duty free access in all products except sugar. In the EAC context the principal beneficiary of this is Kenya, with the elimination of residual duties and import restrictions on fruit and vegetable exports- a development that will help facilitate investment flows into those sectors. 22 All the other EAC member countries, given their LDC status, enjoy these tariff preferences under the EBA initiative. In the ESA context, the conclusion of the Interim EPA ensures continued duty-free access to the EU market for Mauritius, Seychelles and Zimbabwe and also removes all remaining residual tariff barriers, with potential benefits for Mauritius and Zimbabwe in attracting investment in fruit and vegetables. In the case of Zimbabwe, it also sees the removal of quantitative limits on beef exports. 23 With regard to transitional arrangements for sugar, under the EAC agreement an additional tariff-rate quota with zero duty of 15,000 tones is to be opened for marketing year 2008/2009, with a guarantee of prices equivalent to those paid under the Sugar Protocol. For ESA interim EPA members an additional quota of 75,000 tonnes has been made available, although it is not clear how this will be allocated at the national level. 24 20 Babajide Sodipo, The EAC interim EPA and Rwanda, TNI, Volume 7. Number 2 / March 2008 21 Kirk Haywood, Uganda’s EPA: getting the process ‘right, TNI, Volume 7. Number 2 / March 2008 22 Agritrade, EPA Negotiations, Eastern and Southern Africa: Executive Brief ( January,2008) 23 Ibid 24 The Sugar issues will be analyzed and expanded in the full paper. 15 | P a g e
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Page 3 and 4: References ........................
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Page 25 and 26: instruments remain to be negotiated
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Page 31 and 32: etween the EU and Ethiopia as these
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Page 49 and 50: addressed since most of the CARIFOR
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Ethiopia and EPA Negotiation 2008 - FES Ethiopia

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