TRADE - The trade provisions of the Cotonou agreement that partly defines bilateral trade between Africa Caribbean Pacific (ACP) countries and European Union (EU) expires December 31, 2007.

The two parties have since 2003 been engaged in a series of meetings, rotated in Europe, Asia, Africa and the Caribbean to negotiate and finalise the European Partnership Agreements (EPAs).

However, according to updates from Brussels on November 14, the EU was not anywhere near to conclude with EPAs, something that caused fears and panic.

The reason being if EPAs, which will replace old Cotonou agreement, are not finalised and endorsed, it would imply an instant stop to free access to EU market by ACP countries.

Whereas the EU has been, and still is, unhappy with the prolonged EPAs negotiations, ACP counties are taking their time, actually pressing for more time to ensure that EPAs, unlike the expiring Cotonou, bring about fairer trade between EU and ACP countries.

Somewhere in the course of the negotiations, ACP countries decided to negotiate as trade blocs, simply because they have differing interests, bargaining power and capacities in the EU market.

The East and Southern Africa (ESAs) bloc comprising African countries trading with EU including Rwanda, was the formed. 

Rwanda has been negotiating under ESA since a Comesa summit decision in 2003 in Khartoum, Sudan.

A fortnight back all party countries flew to Brussels with scepticism on the fruitfulness of the meeting.

A consensus was reached that, within the very short time remaining until December 31, it was not realistic to conclude a comprehensive EPA.

They, therefore, agreed to work towards an interim framework agreement of an EPA that will comprise trade in goods, development cooperation, fisheries and any other sectors on which negotiations would have been concluded.

And that is what the EAC on Tuesday signed with the EU in Kampala, Uganda.

The framework comprises a number of rendezvous clauses for the continuation of the negotiations beyond December 2007.

The framework agreement will be valid for exactly one year….meaning the negotiations, must be concluded by the end of December 2008.

It will be applied provisionally from January 1, 2008. In that respect, the parties will put in place the necessary regulations and procedures, including the adoption of transitional arrangements by the EC, in order to avoid any trade disruption.

After the Brussels meeting counties were allowed until November 23; that is exactly nine days, including weekend days, to subscribe to the interim agreement to allow enough time to put in place necessary EU regulations to avoid trade disruptions for ACP countries.

The interim agreement will cover market access, development cooperation, fisheries and final provisions.

EAC abandons ESA
Another twist again occurred during the Brussels negotiations. The East African Community (EAC) broke away from ESA to negotiate on its own.

The bloc feels her interests in EU are different. They want to sign EPA agreement with EU as a distinct and separate regional configuration from other existing ACP countries.

Ministers from the EAC and commissioners from the European Union met in Brussels on November 14.

The EAC delegation to Brussels was led by Eriya Kategaya, the chairman of the EAC Council of Ministers. The EAC delegation also included ministers from Tanzania, Uganda; and plenipotentiaries from Kenya and Rwanda.

The EU Commissioner for Trade, Peter Mandelson, and the Commissioner for Development, Louis Michel, represented the EU.  Sources say the decision of EAC detaching itself from ESA turned political. Rwanda and Kenya, for some political reasons, wanted to stay in ESA and that would compromise EAC’s already approved position to negotiate distinctly. Fortunately, after consultations with "high levels”, the Minister of State in charge of Industry and Investment Promotion, Vincent Karega and a few officials headed to Kampala last weekend joined their EAC colleagues in Uganda from where they later signed the interim agreement before the deadline.

In Brussels, EAC welcomed the EC Market Access offer that consists of duty free and quota free Market Access, with transitional arrangements for rice and sugar.

In return, the EC also appreciated EAC Market Access offer consisting of liberalization of 81 percent of her imports from the EU over a transitional period of 25 years.

They mandated technical experts to undertake further work in refining the EAC Market Access offer. 

ESA countries which are at present not in  position to conclude a WTO compatible  trading arrangement, will, as appropriate, benefit from such existing arrangements as; Everything But Arms (EBA) agreement for LDCs.

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