Trade and Development dimension:West Africa – European Union

Economic Partnership Agreement (EPA)

4th Regional Meeting of the ACP – EU Joint Parliamentary Assembly: West Africa

Ouagadougou, 28 – 30 October 2009

ContentIntroductionNegotiation: Structures; Phases; ProcessEPA text

OverviewKey Issues

EPA Development Programme (EPADP) Formulation processOverview of the EPADP Operational plans and its financing

Conclusions / Recommendations

IntroductionHistory

Yaoundé, Lomé I-IV, Cotonou

WA- EU EPAWaiver: End of 2007 WTO Article XXIV Aim: Foster smooth and gradual integration of ACP States into world economy6 RECs: West Africa =16 countries (ECOWAS +Mauritania)

ECOWAS

WAEMU

Guinea

Gambia

Ghana

Nigeria

Mauritania

Liberia

Sierra Leone

Benin Burkina Faso

Côte d’Ivoire Guinea Bissau

Mali Niger

Senegal Togo

WA EPA region

Cape Verde

Negotiation: StructureNegotiations held at three (3) levels (with representation from Civil Society Organisations):

Chief NegotiatorsSenior officialsExperts

ECOWAS Council of Ministers

ECOWAS Council of Ministers

Regional Preparatory Task Force

Regional Preparatory Task Force

Group of AmbassadorsGroup of Ambassadors

Contact GroupContact Group

Technical Support Committee

Technical Support Committee

Ministerial Facilitation TeamMinisterial Facilitation Team Monitoring Ministerial

Committee

Monitoring Ministerial Committee

Regional Negotiation Committee

Regional Negotiation Committee

Thematic Groups and ad-hoc Committees

Thematic Groups and ad-hoc Committees National Negotiation

Committees

National Negotiation Committees

Negotiation: Process (1)

Cotonou Partnership Agreement (June 2000)Decision A/Dec 11/12/01: Mandate given by Heads of State/Government for ECOWAS (+ WAEMU) to negotiate for region (Dec 2001)All ACP phase (Sept 2002)Regional REC Phase (Oct 2003)Roadmap (Aug 2004)Phases I (Sept 2005); II (Oct 2006); III(2007)

egotiation: Process (2)Status as at the expiration of Dec 2007 deadline

Interim Agreements: Cote d’Ivoire (signed); Ghana (initialled)Generalized System of Preferences (GSP): NigeriaEverything But Arms (EBA): 12 LDCs + Cape Verde (transitional period)

Regional meetingsEPA Ministerial Monitoring Committee (MMC)Numerous thematic meetings/workshops

Negotiation meetings

egotiation: Process (3)ief Negotiators meeting: June 2009To take stock of progress with regard to the negotiations, and to provide political guidance for their conclusionParties expressed their satisfaction at progress made in he conduct of the negotiationsDecided to adopt a two-phase as follow:

An intensive phase of negotiation with a view to reaching agreement by October 2009 on a regional EPA covering trade in goods, EPA-related development cooperation and certain trade-related issues;a phase initiated not later than January 2010 with a view to broaden the negotiations in order to cover the remaining topics

hi h ill l t th i l EPA

PA texterviewDivided into eight sections and its annexes, bringing together provisions relating to both trade and the developmental dimensionsDetails the different commitments by each partySeeks to situate the EPA within the development dynamic of he West Africa region, highlighting the need

for special and preferential treatment for West Africa on all trade issuesto strengthen the regional integration process in West Africa, and for specific support programmes for the region within those sectors which contribute to improving the competitiveness of the West African economies

Priority programmes necessary for the improvement of the competitiveness of the region are contained in the EPA

PA texty IssuesEC Internal support measures

In 2005 WTO Hong Kong meeting, developed countries had undertaken to substantially reduce support measures that negatively affect the competitiveness of developing countries

Treatment of Community Levy and Solidarity LevyAutonomous source of financing regional integration. Should be excluded from provisions relating to the treatment of customs duties and therefore scope of the tariff dismantlement

Sectoral policyReserve the right of recourse to certain tariff incentive measures in order to support certain regional sectoral policies

PA text y Issues (cont’)Most Favoured Nation clause

Removes WA’s margin of manoeuvre in all future trade agreements; Automatically granting the EC further benefits without going through the negotiation processWTO does not make such a clause mandatory for free trade agreements.

Non-Execution ClauseWA is opposed to its inclusion. Political aspects of the ACP/EU partnership are governed by the relevant provisions of the Cotonou Agreement, and not the EPA

Market Access (GATT Article XXIV)S d lib li ti i d

PA text y Issues (cont’)Approach to Trade in services

Clause setting up sectoral negotiations, spread over a 3-year period, to identify special commitments for the WA liberalisation process

Treatment of Competition and InvestmentCooperation

Disputes SettlementEC should refrain from applying provision for settlement of disputes for a specified period of time

Rules of OriginSpecial derogation for West Africa on working or processing,

PA text y Issues (cont’)Modalities for financing the operational costs of the organs

Organs created for the implementation should be defined in a protocol

Modalities for the financing of EPADP & other support measuresEPA support is placed within framework of cooperation instruments currently provided by Cotonou Agreement. Therefore EC must undertake to take responsibility for financing support measure for the entire duration of EPAEPADP must be made the subject of a binding protocol annexed to the agreement

Link between trade liberalisation & support to the EPACoherence between implementation rate for its commitments & EC payment for cost of support programmes in order to increase

PA Development Programmemulation process

EPADP was initiated by WA region and offers a coherent ramework for the implementation of priority activities related o the development dimension of the EPAEPADP is coherent with axes identified for the ECOWAS Community Development Programme, UEMOA Regional Economic Programme, WTO Aid for Trade initiative, and Regional, National, and Sectoral development strategiesFormulation of EPADP and operational plans based on a participatory approach involving regional stakeholder, with exchanges with the European partydentification of criteria to select EPADP activities

Diversification nd increase of production capacities

A competitive and harmoniously integrated regional economy integrated into the global economy which stimulates growth and

sustainable development

Development of intra-regional

and facilitation of access to

Improving regional and

national trade related

1. ECOWAS of States to an ECOWAS of people; 2. A borderless region;

3. A space where the population can live in dignity and peace within the framework of law and good governance;

4. A region well integrated into the global community

E

Adjustment costs and other

trade related needs

Implementation and monitoring & evaluation of the

EPA

Benefit from the opportunities of the EPA and mitigate against potential negative effects

E

PA Development Programme

PA Development Programmeration

EPADP is in keeping with a long-term vision of he development objective expected from the

EPAFor operational purposes, EPADP is to be mplemented in five years stages sequencesMatrix of priority activities for the first five years phase has been elaborated in the form of national and regional operational plans

PA Development Programmetional Operational plansAnalysis based on the 16 national operational plans eceived from West African States (ECOWAS +

Mauritania)Varying expression of trade related needs under the five axes of the EPA Development ProgrammeCoherence sought through linkages to national development strategies and budgetary instrumentsWork in progress to ensure coherence and prioritize activities based on selected criteria

PA Development Programme

Axes 120%

Axes 214%

Axes 364%

Axes 42%

Axes 5>1%onal Operational Plans -

ggregated per axeree axes represent ~98% total cost

ominated by Trade-related frastructure (Axe 3)ss emphasis on

djustment costs (Axe 4) d Implementation/

onitoring of EPA (Axe 5)

PA Development Programmeancing modalities for EPADP

EC financing in the framework of the Cotonou Agreement, in particular the EDF; financial instruments of EU general budget; other financial mechanisms after he expiration of the Cotonou AgreementBilateral donor programmes of EU member StatesEU-wide institutions and initiativesFacilitation of support from other donorsCommitment by WA member States

PA Development Programmevelopment dimension in the EPA text : WA positionNegotiations in progress to ensure legal security in the text of EPA or the implementation of EPADP, mainly on the financing and mplementation modalities

EPADP Protocol should be an integral part of the Agreement

Find synergy between rhythm of implementation of WA commitments and support received to improve the competitiveness of the WA region

Response:EU detailed response to the EPADP is being prepared

Expected products by end 2009:Political statement detailing the EU commitment to support the EPADP

plementation Activities and ActorsLarge scope of the thematic areas covered by the EPADPImplementation actors: Regional Organizations, specialized agencies, development institutions, States, non-state actors, implementing agenciesActivities entrusted to the appropriate institution, most qualified and closest to the action and can achieve results stitutional implementation mechanismSteering CommitteesImplementation, coordination and monitoring CommitteeTechnical support unitImplementing bodies/ agencies

PA Development Programme

onclusions (1)Due to the fragile nature of West African economies and he current global economic climate, the EPA appears as both a challenge and an opportunityEPA must contribute towards :

Deepening Regional integrationGradually integrating the region into global economy

Significant progress has been made in negotiations, however key divergences, common to regions yet to conclude negotiations, still remainEPA Development programme seeks to:

maximizing opportunities offered by the agreement, andi i i i i l i k i d i h lib li i

onclusions (2)Significant effort made by WA to elaborate EPADP framework and the national operational plans, which provides adequate nformation on relevant and priority activities, to be undertaken in the EPA supporting framework. Needs mainly centred around trade-related infrastructure

West Africa committed to mainstreaming identified activities nto budget instruments. However, further work being undertaken to ensure coherence and prioritisation requires an ndication of the financial level of resources to be provided byhe European party

EC commitment remains at a political level with a lack of visibility on the level of financial support to implementation of he first 5 years of the EPADP

onclusions (3)Activities identified within the EPADP exceed resources available (e.g. under the 10th EDF National/Regional ndicative Programmes) therefore requiring additional unding

The presentation of a financing plan for the EPADP is necessary to appreciate the contribution towards making he EPA a veritable tool for development, and constitutes a prerequisite for the signature of the EPA

WA reiterates its commitment to concluding a development-friendly Agreement which is centered around regional integration

ecommendations (1)PA must allow for special and preferential treatment for

West Africa on all trade issues and strengthen the regional tegration process in West Africa

all for the commitment of all EU member States and other onors in providing support to EPADP as well as extending eir assistance to more West African States

wnership by, and mobilisation of, all actors needed for the mplementation of EPADP: mainly member States, egional Integration Organisations, donors etc.

creased absorption capacity and improved donor oordination is necessary to optimise the level of

f ff

ecommendations (2)Measures must be taken to ensure entry into force of nterim Agreement does not disrupt regional integration process

tonou Partnership Agreement: Articles 6 & 17Stronger involvement and participation for Parliamentarians

Involvement in national policy development and implementationParliamentary committees to monitor development in negotiationsFamiliarisation with domestic processes to provide timely input

ncreased Representational, Oversight, Legislative roles

Thank you for your attention -----

Merci de votre attention-----

Obrigado

r more information please contact:B. Daramymmissioner for Trade, Customs, Industry, Mines and Free Movement,OWAS Commission, 101 Yakubu Gowon Crescent,