Report on the Implementation of the derogation to ... - Trade Websites

Final <strong>Report</strong>
RoO Derogation under the PACP-IEPA
7.4 PACP-EPA Negotiations
Negotiations for a comprehensive EPA between the EU and the PACP are ongoing. One of two
scenarios is likely:
1. If the EPA negotiations collapse then PNG and Fiji would stick with the IEPA, the Solomon
Islands with ‘Everything But Arms’ (EBA), and other PACP tuna processing countries with the
standard GSP. In this scenario, it is likely that no additional PACP countries would benefit
from global sourcing.
2. If the EPA were concluded then global sourcing would possibly be extended (subject to
notification) to other signatory countries. In terms of the processing of canned tuna and
tuna loins, this might include: the Marshall Islands, although it does not currently have a
Competent Authority established for EU SPS measures or the EU IUU regulation; and the
Solomon Islands, which would switch from GSP to global sourcing RoO. Foreign investors
looking to establish new tuna processing facilities in the Solomon Islands have been lobbying
the government to negotiate a comprehensive EPA. The Solomon Islands has recently
conducted an economic analysis and risk assessment to compare the benefits of their
current EBA market access conditions with what could potentially be achieved under the
IEPA or comprehensive EPA, with global sourcing RoO provisions (the results of which are
not yet publicly available).
Finally, it is worth noting that a number of PACPs are interested in improved market access for freshchilled
and frozen fisheries products (falling under HS headings 0304/0305), since these are highvalue
products in demand in the EU and are of critical developmental importance to those PACPs
without canning or loining processing capacity. Global sourcing provisions were not offered for
0304/0305 under the PACP IEPA, and were instead deferred for negotiation under the
comprehensive PACP-EPA. Hence, this was one of the major contributing factors to some PACPs not
wanting to sign an IEPA.
8 CONCLUDING COMMENTS
In the three year period since PNG made notification of its intention to utilise the global sourcing
derogation (March 2008-2011) the impact has been negligible in terms of long term income and
employment generation in the PNG economy, the effective conservation and sustainable
management of the WCPO tuna resource, and impacts on the EU market and EU fishing and
processing industries. This is on account of several key factors:
• Investment in onshore processing facilities in PNG has been driven by the desire of
companies to secure access to PNG’s highly productive waters, in response to PNG’s policy
directive, whereby preference for fishing licences will be given to those companies with
onshore investments in PNG.
• To date, PNG’s three existing processing facilities have had adequate supplies of originating
fish to meet their processing needs, so have not yet needed to source raw materials more
widely through global sourcing.
• While plans are in place for an additional five new processing plants, only one plant is
currently under construction; the remaining four plants are still in the planning phase –
hence, these facilities are yet to require raw material supplies.
Over the medium- to longer-term, global sourcing will play an increasingly important role in the
development and survival of PNG’s tuna processing industry. Duty free market access to the EU,
Linpico s.a.r.l. Page 171