The European Union has suspended the latest round of trade negotiations with Pacific ACP States (PACPS) on the Economic Partnership Agreement (EPA).
On Friday last week, July 5 in Brussels saw the conclusion of another round of trade negotiations between PACPS and the EU on the EPA amidst serious divergences over a number of contentious issues, including the EU’s request to introduce significant changes in PACPS’ national laws dealing with the management of fisheries resources.
The EU could not agree to the PACPS’ request to continue negotiations in September 2013, and asked for a period of reflection to consult their stakeholders. The EU expressed strong disappointment towards the PACPS’ position that any issue concerning the management of fisheries resources should only be dealt with in the competent forums, i.e. the Western and Central Pacific Fisheries Commission (WCPFC). The EU’s request to use the EPA to address PACPS’ fisheries management appears motivated by the fact that previous attempts to debate the issue in the WCPFC did not produce any positive results for the EU.
In addition to the disagreement on fisheries issues, a number of additional topics were identified which could not be solved at technical level. These include three major redlines advocated by Vanuatu’s delegation: The request of Vanuatu to obtain special and differential treatment in terms of tariff liberalization due to its unique fiscal circumstances, the significant role played by import duties in terms of tax revenues – Vanuatu requests to liberalize 70% of its tariff lines instead of 80% as requested by the EU; The request of Vanuatu to formally introduce the possibility of using the EPA to discuss and solve market access issues for Kava – as requested by MSG leaders in their last meeting in new Caledonia; The request of Vanuatu to eliminate any binding reference to tax issues from the EPA, in particular any obligation in terms of Tax Information and Exchange Agreements going beyond OECD’s commitments.
With negotiations facing a major deadlock, PACPS will now have to report to their Leaders as to possibility of delivering on the 2012 mandate to conclude EPA negotiations by the end of 2013, a mandate which now seems very difficult to achieve unless major shift is observed in the EU’s position.
The Vanuatu delegation in Brussels was led by Marokon Alilee, Director General, Ministry of Tourism,Trade, Commerce, and Ni-Vanuatu Business, and included Sumbue Antas, Director of the Department of External Trade, and Andrea Giacomelli, Senior Trade Adviser.
EPA negotiations started in 2004 with the objective of introducing a WTO-compliant system trade preference that could substitute the old trade preferences granted by the EU to ACP States.