WEST AFRICA – EUROPEAN UNION ECONOMIC PARTNERSHIP AGREEMENT (WA-EU EPA) MARKET ACCESS: CHALLENGES FOR ECOWAS AGRO EXPORTS UNDER THE EPA Presented at the ECIATA-EDULINKII Dissemination Workshop Enhancing Capacities on Agricultural Trade Agreements for The Developments of regional Agriculture and Food Markets, ACCRA,23-24 th March 2015 Dr. Gbenga Obideyi Director of Trade, ECOWAS COMMISSION 1

Outline 2 Introduction…  Improvements after Differences  What’s in the Agreement? Market Access…  What’s in the Agreement for Agriculture and Fisheries?  Specific Commitments on Development Cooperation Challenges…  General concerns for Agro Exports  Specific challenges for Agro Exporters Solutions…  How the Text of the Agreement addresses the challenges

Introduction… Improvements after differences Negotiations on the WA-EU EPA completed and endorsed  By the ECOWAS Heads of State and Government in July 2014  Agreement reached by Chief Negotiators in February 2014  12 countries signed it off in December 2014 Major areas of improvement included:  Removal of EU subsidies on agricultural products to West Africa  Financing of the development dimension of the EPA  EU support for additional funds mobilisation with other donors  Establishment of a Competitiveness Observatory  Automatic derogation on Tuna  Better West Africa market access offer (25% protection for sensitive products)  Longer period of liberalisation (20 years) 3

Introduction… What’s in the Agreement? Essentially a Goods Agreement, in 5 Parts, 116 Articles and 6 Annexes:  Preamble  Part I: Economic and Trade Partnership for Sustainable Development  Part II: Trade Policy and Questions Concerning Trade  Part III: Cooperation for Implementation of Development and Achievement of the Objectives of the Agreement  Part IV: Dispute Avoidance and Settlement  Part V: General Exceptions Annexes on Market Access Offers and Rules of Origin Rendezvous clause for future negotiations (Art. 106)  Services; Intellectual property and innovation; Current payments and capital movements; Protection of personal data; Investment; Competition; Consumer Protection; and Sustainable Development 4

Introduction… Initialling (Which countries are there?) The differences produced the following results  Twelve (12) West African States have in December 2014 signed off the Agreement:  Benin; Burkina Faso; Cape Verde; Cote d’Ivoire; Ghana; Guinea; Guinea Bissau; Liberia; Mali; Niger; Senegal; and Sierra Leone  Three (3) West African States are yet to sign it off  Gambia; Nigeria; and Togo ; (Mauritania) For some countries, reasons other than the differences prevented them from signing  West Africa working towards resolving the differences to ensure collective signing of the Agreement 5

Market Access… Agriculture, Fisheries & Food Security Chapter 6 of the Agreement is titled Agriculture, Fisheries & Food Security  Agriculture and Fisheries represented two of the key sectors in terms of market access and development cooperation  At the outset, the West African side emphasized the need to have these sectors recognised for the important contribution they make to food security; export earnings and rural development  Most agricultural products excluded, with longer periods for liberalisation The objectives of the Chapter are set out in Article 46:  Role of agriculture in the fight against food insecurity;  Provide an income and employment for working class;  Contribution of agriculture to poverty eradication; and  sustainable development and exploitation 6

Market Access… Advantages The Agreement holds the following advantages for the Agriculture and Fisheries Sectors:  Preserves the Cotonou preferences for agricultural products  Provides additional market access for products which did not duty-free – quota free entry into the EU  Allows the region to continue protecting most of its sensitive agricultural products  Provides for safeguard measures which takes into account the peculiarities of agricultural markets and trade  Explicit provision for development assistance and cooperation 7

Market Access… Specific Commitments on Development Cooperation Specific commitments on development cooperation (Article 48):  Improving the storage and preservation of agricultural products  Promoting contract farming with partners from the EU to supply organic products;  Identifying new opportunities for the development and export of products for which there is a strong international demand;  Managing tracks and roads serving rural communities to enhance the collection and movement of agricultural products;  Contributing to the development of regional exchanges for greater centralisation of information regarding the regional availability of food products; and  Promoting land law reforms to increase the legal certainty of farmers and in so doing promote the development of efficient agriculture and raise credit of encourage private investment in the agricultural sector 8

Challenges… General Concerns for Agro Exports Agriculture and Fisheries sectors ill equipped to take advantage of the opportunities provided by the EPA Some of the fears expressed by operators in the sector include:  Weak agriculture and fisheries sector infrastructure;  Inability to meet technical product specifications;  Lack of capacity to compete with highly subsidised EU imports;  Stringent requirements in terms of product quality, safety, health and environment  Exposure to cheap EU products and more efficient producers 9

Challenges… Specific Challenges for Agro Exports Some of the specific challenges for ECOWAS agro exports include:  Need for traceability  Receipt of supplies from known sources and being able to check agricultural practices concentrate exports in the hands of highly capitalised producers  Fair trade ethics  Ethical issues such as human rights and products free from child labour  Proliferation of private standards and supermarket power  Standards increases the overhead costs to the smallholders which may constrain their performance in the agro export industry and future expansion of export business  SPS and TBT Measures  EU legislation represents the minimum requirements for market access which can constitute obstacles to trade 10

Solutions... Addressing some of the challenges Export Subsidies  Paragraph 6 of Article 48 commits the EU to the elimination of export subsidies on all agricultural products exported to West Africa  West African Party not required to eliminate any export subsidies that are applied in accordance with its rights under the WTO Agreement on Agriculture and the Agreement on Subsidies and Countervailing Measures (ASCM) 11 Implication for agro exports: Whereas individual ECOWAS Member States can provide export subsidies (or not remove existing ones), the EU, on the other hand, will be obliged to remove export subsidies on agricultural products they export to West Africa. This somewhat addresses concerns on competition from highly subsidised EU agricultural exports

Solutions... Addressing some of the challenges Trade Defence Instruments  To ensure an environment of fair trade is maintained, the EPA allows for:  Imposition of antidumping and countervailing duties on dumped products, that is, products sold at a price lower than the cost of production in the importing market (Article 20); and  Safeguard measures to protect domestic industries from increased quantities which leads to serious injury or disturbances (Articles 21 & 22)  Appropriate remedial actions include:  Suspension of any further reduction in the customs duty;  Increase in the customs duty to a level no higher than the MFN rate  Introduction of tariff quotas on the product concerned 12 Appropriate remedial action under the Agreement includes suspension of the further reduction of the CET, increases in customs duties and introduction of tariffs

Solutions... Addressing some of the challenges General Exceptions (Article 87)  The general exception clause is devised to secure the adoption or enforcement of measures which are necessary to:  Protect public security and public morals or to maintain public order;  Protect human, animal or plant life or health;  Secure compliance with laws or regulations which are not inconsistent with the provisions of this Agreement;  Protect national treasures of artistic, historic or archaeological value;  Conserve exhaustible natural resources if such measures are made effective in conjunction with restrictions on domestic production or consumption of goods, domestic supply or consumption of services and on domestic investors 13 What this means is that Agro exporters can still be protected from competition insofar as Member States can justify that such measures were necessary for the above reasons

Thank you ! Gbenga G Obideyi Director of Trade