PACIFIC TRADE MINISTERS

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PACIFIC ISLANDS FORUM SECRETARIAT Suva, Fiji Islands

 

PRESS STATEMENT June 28, 2001

Apia, Samoa

WELCOME EUROPEAN UNION
TRADING ARRANGEMENT PROGRESS

Trade Ministers from 14 Pacific Island countries have welcomed progress on preparations for a new trading arrangement with the European Union under the terms of the Cotonou Agreement -- the partnership agreement signed last year between the EU and the African, Caribbean and Pacific (ACP) group.

"Since its inception in 1975, the Lomé Convention between the ACP Countries and the EU has given non-reciprocal trade preferences to ACP exports into the EU market," said the Secretary General of the Pacific Islands Forum Secretariat, Mr. Noel Levi, while opening a meeting of Pacific ACP Trade Ministers in Apia, Samoa.

"However, since these preferences favor only the ACP countries, rather than all developing countries, they are discriminatory and contravene the EU’s WTO obligations under Article One of GATT – the Most Favored Nation clause," Mr. Levi said.

To overcome this problem, the Cotonou Agreement requires the negotiation of WTO compatible new trade arrangements, to enter into force in 2008. Such arrangements could be either through an "Economic Partnership Agreement" (EPA), or for those who decide not to negotiate an EPA, through some other alternative trade arrangement. A WTO waiver has been sought for up until 2007 in order to continue with existing trade preferences while the EPAs are being negotiated.

An EPA would be based on a free trade agreement. This would enable existing Lomé levels of market access to be maintained, and hopefully improved, but would also provide reciprocal access to ACP markets for EU exports.

"For some countries an EPA may prove unacceptable. In this case ACP countries may pursue other alternative arrangements. One such option is to simply revert to lower level preferences available under existing GSP provisions (or equivalent preferences under super GSP provisions for LLDCs). The GSP system is WTO compatible, and would avoid the need to reciprocate access, which may trigger other obligations.

"Pacific ACP Countries must be fully aware of all the issues and build capacity in the areas of trade policy and negotiation skills. The Pacific ACP Countries need to review their trade policies in the light of what is being proposed. We also need to understand the possible impact of various new trade arrangements," Mr. Levi said.

The Forum Secretariat has submitted five proposals to the ACP Secretariat seeking funding under the Global Funding allocated to ACP by EU to assist the ACP countries with their preparations for the negotiation.

These requests are for impact studies of new trading arrangements, trade policy assessments, regional and national workshops for capacity building and a Pacific ACP Trade Ministers meeting. Under this plan, the proposed Pacific ACP Trade Ministers Meeting scheduled for first quarter 2002 will be able to discuss the various options of new trade arrangements and also decide on the negotiating team from the region.

For additional information, contact: Ulafala Aiavao at UlafalaA@forumsec.org.fj 

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