ACP/00/018/04 Rev.1 Brussels, 25 October 2004 Sustainable Economic Development Department ACP-EC/JMTC/NP/60 JOINT REPORT ON THE STATE OF PLAY OF REGIONAL EPA NEGOTIATIONS Joint ACP-EC Technical Monitoring Committee Brussels, 25 October 2004
Joint Report on the state of play of regional EPA negotiations 1. The opening of Economic Partnership Agreements negotiations took place in Brussels on 27 September 2002. During the first year of negotiations at all ACP-EC level, both sides examined horizontal issues of interest to all parties. At the Joint ministerial meeting held on 2 October 2003, which marked the beginning of the second phase of EPA negotiations, the ACP Council of Ministers and EC Commissioners for Trade and Development adopted a joint report (reference ACP/00/118/03 Rev.1 ACP-EC/NG/NP/43) and expressed satisfaction about the high degree of convergence reached. They further agreed to continue discussions at the All ACP-EC level on horizontal and other issues requiring further clarification. They decided that the joint report would serve as a point of reference, and provide guidance, for the negotiations to be conducted at regional level. Both sides also agreed to work further together with a view to ensuring transparency and coherence of the overall negotiating process. To that end, they proposed 1) to establish an all-acp- EC Technical Monitoring Committee, in order to maintain transparency with regard to the regional negotiating processes, and 2) to request the Joint ACP-EC Ministerial Trade Committee (JMTC) to ensure mutual understanding on horizontal issues of interest to all parties. 2. The first meeting of the all ACP-EC Technical Monitoring Committee (TMC) took place on the 25 th October 2004 in Brussels. The present joint report has been prepared by the Joint TMC to be presented at the Joint ACP-EC Ministerial Trade Committee on the 27 th October. 1. THE STATUS OF NEGOTIATIONS BETWEEN THE EC AND THE 6 ACP REGIONS 3. EPA negotiations have been opened between the European Community and six ACP regions, (1) Central Africa and (2) Western Africa in October 2003, (3) with a number of countries in Eastern and Southern Africa (ESA) in February 2004, (4) the Caribbean in April 2004, (5) with seven members of the Southern African Development Community in July 2004, and (6) with the Pacific in September 2004. 4. For all the six EPA negotiations, road-maps for the negotiations have been agreed which detail the organisation and the bilateral negotiating structure, priority issues and indicative schedule of negotiations for the entry into force of the EPAs on 1 st January 2008. In all these documents, the question of the regional integration objectives and agenda and their link to the EPA process has been defined as a first priority for technical talks. Technical discussions are now on-going with the six ACP regions in order to make the EPAs instruments for regional integration and development. 5. During the 1 st phase of the negotiations at all ACP EC level, both sides agreed that EPAs need to be accompanied by appropriate development-support measures in order to allow ACP countries and regions to maximise the benefits they should be deriving from EPAs. This is why joint EC-ACP Regional Preparatory Task Forces (RPTFs) have been set up. They have to foster inter-linkage and complementarity between development strategies supported by the EU, and economic and trade cooperation so as to make them mutually reinforcing. 1.1. The Central Africa region 6. The EPA negotiations between the European Community and the region of Central Africa were launched on 4 October 2003 in Brazzaville, Republic of Congo. They include the six Member States of CEMAC (Economic and Monetary Community of Central Africa), namely Cameroon, the Republic of Congo, Gabon, Equatorial Guinea, the Central African Republic and Chad as well as Sao Tome and Principe, which is not a member of CEMAC. The "roadmap" for the negotiations was signed in Brussels on 16 July 2004. It specifies the principles and objectives of the EPA, the organisation and structure for the negotiations, determines an indicative work programme and a provisional timetable, and provides for the establishment of a Regional Preparatory Task Force. 2
7. The first technical meeting took place in Douala (Cameroun) on 16 September 2004, when the working procedures for the various negotiation bodies were specified. Discussions took place on the working methods of the first specialised technical groups, namely on Sanitary and Phytosanitary Measures (SPS), technical barriers to trade (TBT), and trade facilitation. In addition, an examination of the implementation of the Regional Indicative Programme (RIP) and its relation to the National Indicative Programmes (NIP) was undertaken. As a result, participants formulated a series of recommendations, concerning in particular an action plan and a list of studies to be carried out. This will have to be finalised at the next meeting arranged for the end of November 2004 in Brussels. 8. The 2005 work programme will include both the creation of a regional market to ensure the effective movement of goods, and a reference framework for the bilateral commitments for all trade measures. Thus, technical work will be undertaken on all trade related issues (in particular competition, intellectual property rights and investment) and on trade in services. The forthcoming technical meetings will be held in Brussels at the end of October. They will be concluded by a meeting of the negotiation committee later in the year. A Ministerial meeting will be held during the second half of 2005 in order to note progress in the creation of a genuine regional market in Central Africa and to provide guidelines for the second phase of negotiations on the architecture and the composition of the draft agreement. The third phase of negotiations will start in September 2006 and covers reciprocal liberalisation, including market access commitments. 1.2. The Western Africa region 9. The EPA negotiations between the European Union and the region of Western Africa were launched on 6 October 2003 in Cotonou (Benin). The fifteen Member States of the ECOWAS (Economic Community of West African States) are represented, namely Benin, Burkina Faso, Côte d'ivoire, Guinea-Bissau, Mali, Niger, Senegal, Togo, Cape Verde, Gambia, Ghana, Guinea, Liberia, Nigeria, Sierra Leone, and Mauritania, the latter not being a member of ECOWAS. The first 8 countries are also members of the Western Africa Economic Monetary Union (WAEMU). The roadmap was adopted by the Ministers of West Africa at this meeting in Accra on 4 August 2004 and was formally agreed by an exchange of letters. 10. The joint roadmap for the negotiations sets out an indicative work programme, defines the negotiating structure and operational modalities including the establishment of the RPTF, and recalls the integration priorities of the West African region. It demonstrates the shared ambition of the Parties to make the EPA an instrument for the economic and regional integration development of West Africa. 11. At the first technical meetings held in Abuja (Nigeria) on 21 and 22 September 2004, it was decided to structure the negotiations according to three technical groups: the first on the questions connected to regional integration of the West African market (free trade area, customs union, trade facilitation, sanitary and phyto-sanitary measures, and technical barriers to trade); the second on trade-related issues (in particular competition, investment and intellectual property rights); and the third on services. 12. The work programme for 2005 will include the subjects covered by the three abovementioned technical groups. This first phase of negotiations will examine the elements necessary to make progress in the regional integration process in West Africa. It will also include the definition of the general objectives to be achieved in the EPA negotiations in terms of trade measures and necessary supporting measures. The forthcoming technical meetings will take place in Brussels in December 2004. The committee of the senior officials will also meet in December 2004 to detail the work programme of 2005. These meetings will also report on the status of capacity building activities in the region. A joint report by trade measure will be drawn up for the Ministerial meeting which will be held before the end of 2005. The second phase of negotiations will look at the architecture of the agreement and the third phase, from September 2006, will deal with reciprocal liberalisation including market access commitments. 3
1.3. The Eastern and Southern Africa (ESA) region 13. A group of 16 countries - Burundi, Comoros, Djibouti, DR Congo, Eritrea, Ethiopia, Kenya, Madagascar, Malawi, Mauritius, Rwanda, Seychelles, Sudan, Uganda, Zambia and Zimbabwe - in Eastern and Southern Africa opened EPA negotiations with the European Community on 7 th February 2004 in Mauritius. 14. At the launch of the negotiations in February 2004 a roadmap was agreed detailing objectives, structure and priority areas for the negotiations. Since then, ESA has advanced considerably in organising itself putting in place national and regional structures for the negotiations. 15. At the first ESA and EC senior official meeting at the end of July, both sides agreed initially on three priorities for the talks over the next 9 months: a regional fishery framework agreement (covering both trade, including RoO, and principles for access agreements), development issues (including supply side constraints, short term costs of adjustment, market development and the toolbox for regional integration) and market access issues (such as rules of origin, tariffs and sanitary and phytosanitary measures). They adopted the terms of reference for the RPTF. The EC underlined the need to rationalize the regional network of overlapping trading agreements, and reiterated its availability to help the region in its own regional integration efforts. ESA emphasised that regional integration should be seen in the wider context of Africa-wide integration. 16. Regarding market access, both sides agreed to focus on the South-South aspects, which should be clarified before meaningful South-North discussions could take place. It was further agreed that technical groups would start work on joint papers. The next EC-ESA senior official meeting is planned for November 2004. 1.4. The Caribbean region 17. On 16 April 2004 in Kingston, Jamaica, EPA negotiations were opened between the European Community and 15 countries of the Caribbean Forum of ACP States (CARIFORUM). For the purposes of these negotiations, CARIFORUM represents the regional configuration of the following countries Antigua and Barbuda, The Bahamas, Barbados, Belize, Commonwealth of Dominica, Dominican Republic, Grenada, Guyana, Haiti, Jamaica, St. Kitts and Nevis, Saint Lucia, St. Vincent and the Grenadines, Suriname, and Trinidad and Tobago. 18. During the first Ministerial negotiating meeting that immediately followed the opening of negotiations, Caribbean Ministers and Commissioners Lamy and Nielson adopted a joint Plan and Schedule for the EPA negotiations. This document specifies the principles and objectives of the EPA, the organisation and structure of the negotiations, the role and membership of the Regional Preparatory Task Force set up to facilitate the inter-linkage between the negotiations and development assistance, and an indicative schedule of negotiations. 19. In accordance with the Plan and Schedule, negotiations have started with an initial period aimed at establishing the priorities of EPA negotiations for both sides, and at preparing a second phase aimed at convergence on the priorities for support of CARIFORUM regional integration. 20. To this end, Caribbean and EC Principal Negotiators (high officials) met in Brussels on 15 July 2004. There was a broad understanding on the scope and priorities of the negotiations, which are aimed at promoting sustainable development in the Caribbean through increased trade, investment and regional integration. Agreement was reached on modalities for the Regional Preparatory Task Force. Both sides also agreed to an indicative calendar of technical and high-level negotiating meetings that will focus on specific issues relating to Caribbean regional integration relevant to the EPA. 4
21. These meetings, which are due to start in November 2004, will address the following clusters of issues: regional market access, services and investment, and trade-related areas. These meetings include three meetings of the Principal Negotiators and will culminate in a Second Ministerial Meeting in St Lucia in September 2005, which will conclude the regional-integration phase of the EPA negotiations and launch the third phase aimed at channelling points of common understanding into elements of a draft EPA. 1.5. The Southern Africa (SADC) region 22. The countries which have decided to negotiate an EPA with the European Community under the Southern African Development Community (SADC) configuration are Angola, Botswana, Lesotho, Mozambique, Namibia, Swaziland and Tanzania. South Africa will participate in an observatory and supportive capacity. 23. SADC EC EPA negotiations were formally launched on 8 July 2004 in Windhoek, Namibia. On that occasion a Joint Roadmap was adopted, which outlines the objectives and principles, the structures and the sequencing of the negotiations, and provides for the establishment of the RPTF. A first negotiating session at Ministerial level also took place, during which the SADC side notably put the emphasis on the need to simplify rules of origin and to ensure that EC SPS measures do not have a negative impact on SADC exports. The EC underlined the need to rationalize the regional network of overlapping trading arrangements, and reiterated its availability to help the region in its own regional integration efforts. 24. The period from July to December 2004 will be used for priority setting and preparations, with substantive negotiations taking place from January 2005 to June 2007. These will focus on market access for agriculture, non-agricultural products and fisheries, trade in services, development cooperation, other trade-related issues and legal provisions. They will seek to strengthen SADC integration in all these areas and, over time, define a reciprocal trading relationship between the SADC and the EC. The last stage of the negotiations will be the finalization of the agreement, which should be signed by December 2007 and enter into force on 1 st January 2008. 25. An orientation seminar has been organized in Brussels for SADC negotiators at the end of September, and ongoing technical talks should allow the SADC and EC Senior Official negotiators to agree in December 2004 on a set of priority areas for the negotiations and on the terms of reference of the Regional Preparatory Task Force. 1.6. The Pacific region 26. The countries which have decided to negotiate an EPA and new trading arrangements with the EC as part of the Pacific ACP Group are the Cook Islands, the Federated States of Micronesia, Fiji, Kiribati, the Republic of the Marshall Islands, Nauru, Niue, Palau, Papua New Guinea, Samoa, Solomon Islands, Tonga, Tuvalu and Vanuatu. 27. EPA negotiations were formally opened on 10 September 2004 in Fiji and a joint roadmap was adopted, which outlines the objectives, principles, structures and sequencing of the negotiations, and provides for the establishment of the RPTF. During the first negotiation session at ministerial level on the same day, the need to make EPA a tool for development and tailor it to the specific needs and constraints of the Pacific was highlighted and discussed. It was also agreed that during negotiations existing legal obligations of the Pacific ACP countries towards other major partners would have to be considered. 28. The priority for 2005 will be to discuss and where possible already reach substantive agreement on basic principles and elements to be integrated into an EPA. In parallel, consultative activities will be carried out so that all Pacific ACP States and other stakeholders will have regular opportunities to contribute to the formulation of the region s negotiating position. Detailed research 5
and preparatory activities will also be undertaken. In this context, regional integration issues will be given particular attention as they relate to the various subjects discussed under an EPA. 29. In 2005, it is foreseen to have three full negotiation sessions at senior officials level (tentatively scheduled for the first, third and fourth quarters). A ministerial negotiating session may also be held. Discussions will focus on principles and a priority cluster of selected major issues to be dealt with under the EPA. In addition, preparatory meetings at technical level will be organised. 2. CONCLUSIONS 30. The road maps adopted for the negotiations with the six ACP regions reaffirm the commitments made in Cotonou and in the joint report of all ACP-EC phase of the negotiations. They recall that the main objective of the Economic Partnership Agreements is to promote sustainable development and the deepening of the regional integration process. This is reflected in the present initial phase of the negotiations with the six ACP regions, which focuses on regional trade, the level of implementation of trade integration objectives in ACP countries, the necessary studies and support measures to foster and deepen the integration agenda. This first emphasis on consolidation of ACP markets will contribute to establishing the necessary regional policies to be implemented in the six regions for the entry into force of the EPAs as from 1 st January 2008. At the end of this initial phase of the regional negotiations the parties will have examined the main objectives for regional integration and for EPAs in order to prepare for further trade integration with the EC. 31. The road maps further reaffirm the specific objectives of EPAs to promote sustained growth, to increase production and supply capacity of the ACP countries, to foster the structural transformation of the ACP countries and their diversification with the ultimate objective of fostering the smooth and gradual integration of the ACP into the world economy and contributing to poverty eradication. As a first step, priority areas have been identified, such as sanitary and phytosanitary measures, technical barriers to trade and trade facilitation, where the promotion of regional cooperation and rules will help to remove significant barriers to trade, first between the ACP countries and then between the ACP and the EC. Other areas for technical work during this first phase include, inter alia, the creation of a conducive environment to attract both domestic and foreign direct investment to support the private sector and development of regional infrastructure networks, free trade areas within the ACP regions, common external tariffs and custom procedures, which are the main pillar of the regional markets and which will have a direct effect on economic development. 32. However, EPA negotiations alone will not be sufficient to tackle all supply side constraints faced by ACP countries. This is why trade is being mainstreamed into the development policies of the ACP countries and regions and fully integrated into the development cooperation policies of the European Union. The RPTFs have therefore been assigned the key task to contribute to the coherence between the programming of aid at national and regional levels and the negotiations. They will also translate support needs identified by the negotiators into action programmes. 33. The Joint Ministerial Trade Committee meeting is invited to endorse this report on the status of the six EU-ACP regions EPA negotiations and to address and provide political guidance on all areas of the negotiations, as they deem necessary. 6