Pacific Small islands' demands sunk: Cautious over EPAs with EU

Fourteen Pacific states involved in negotiations aimed at reaching an Economic Partnership Agreement with the EU last year submitted a proposal outlining the key ingredients that they felt such a free trade deal should contain.

One year later, the EU's executive, the European Commission, has finally presented the Pacific with a draft EPA, which has been accused of not addressing almost any of the issues raised by the small island states. 

Government Officials in a meeting held at Nadija, Fiji in August this year had complained about the same at the time. They said that the draft focuses only on opening the Pacific's markets to multinational firms. It says, for example, that foreign investors in the Pacific should be treated in a way "no less favourable" than domestic ones.

The Commission says that the December 31 deadline for concluding an EPA must be respected. A waiver from the World Trade Organisation's rules applying to preferential treatment given to exports from African, Caribbean and Pacific (ACP) countries to the EU expires the following day.

"In terms of practicality, I don't see us concluding a deal by the end of this year," a high-level diplomat from the Pacific region told the media.

"We haven't really progressed to a stage where we could consider any particular negotiation ripe for harvesting. We submitted our proposals to the Commission last year, and one of the concerns that we've raised continuously with it has been the length of time it has taken to have any response. We still have a long way to go."

One of the major worries expressed at the Fiji gathering was that if the deadline is missed, the EU will impose punitive tariffs on imports from the Pacific. This could have a severe effect on canned tuna from the Pacific, leading to sharp job losses in the fish processing industry, according to officials from the region.

But anti-poverty campaigners are urging the Pacific governments not to capitulate to the threats of tariffs. "The Commission is bluffing," said Marc Maes, a trade specialist with the Belgian organisation 11.11.11 based on the fact that in the past 30 years tariffs have never been used and reintroduction would not be acceptable to the European Parliament. 

Maes said that the Commission's directorate-general for trade (DG Trade), which drew up the EPA, is not sensitive to the needs of poor countries.

"The draft EPA does not contain anything about development. DG Trade does not know how to adapt texts to the circumstances of ACP countries; it just delivers the standard offensive texts it is used to preparing. That's what its remit is and when ACP countries come forward with proposals, they are not listened to."

The UNCTAD Trade and Development report 2007, released on the 5th September this year expressed unease about the growing number of free trade deals negotiated between poor and rich countries.The number of trade agreements - most of which are between rich and poor countries - notified to the World Trade Organisation rose from 20 in 1990 to 159 in 2007.

By covering such topics as competition policy, intellectual property and investment, these deals tend to be skewed towards the interests of multinational companies and limit the scope of poor country governments to manage their own economies. Such has been the observations of the UNCTAD report.

"The gains for developing countries from improved market access (to richer economies) are far from guaranteed, whereas the loss of policy space is certain," its report added.

Although customs duties are known to be an important source of revenue for poor countries, the draft EPA for the Pacific provides for their reduction, and in many cases, their elimination. These charges "shall not represent indirect protection for domestic products or a taxation of imports or exports for fiscal purposes," it adds.

The draft would also require the Pacific countries - which include Papua New Guinea, Samoa, the Solomon Islands, the Cook Islands, Tonga and Vanuatu – to ensure an "effective level" of enforcement for intellectual property rights.

Officials in the Commission have made clear recently that they wish to promote intellectual property protection in agreements with third countries as part of efforts to crack down on the piracy and counterfeiting of goods.

In May, however, an international grouping of academics warned that incorporating provisions on intellectual property in free trade deals could have adverse impacts for poor countries. It would mean farmers can be prevented from saving and reusing seeds in cases where patent rights are upheld, thereby putting food security in jeopardy, said the academics, who included Carlos Correa from the University of Buenos Aires, Sue Edwards of the Institute for Sustainable Development in Ethiopia and Frederick Abbott of Florida State University.

Further, Oxfam also comments that two-thirds of tariffs imposed by the Pacific on European goods would have to be scrapped under an EPA, with the result that local firms could not be shielded from outside competition. 

"The Commission's draft does not take into account the Pacific's concerns," said Alexander Woollcombe, a spokesman for Oxfam's Brussels office. "We are concerned that the Commission is not listening to ACP regions that are putting development to the forefront but is instead pushing an aggressive free trade agenda."

Released on: 7 September 2007
Resource: www.ipsnews.net