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What are the costs of a non-EPA? TIPS Workshop, Pretoria 4-5 March Dr Mareike Meyn.

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Presentation on theme: "What are the costs of a non-EPA? TIPS Workshop, Pretoria 4-5 March Dr Mareike Meyn."— Presentation transcript:

1 What are the costs of a non-EPA? TIPS Workshop, Pretoria 4-5 March Dr Mareike Meyn

2 Alternatives to EPAs. TIPS workshop March 20082 Overview  What are the alternatives to EPAs for  Developing African countries  For Least Developed Countries (LDCs)  What costs occur for 1.Non-EPA signatory LDCs 2.Non-EPA signatory developing countries 3.Signatory LDCs that will not ratify an EPA 4.Signatory developing countries that will not ratify an EPA  Differentiation of these 4 types is important since the countries face different costs when not joining an EPA

3 Alternatives to EPAs. TIPS workshop March 20083 What are the alternatives to EPAs?  Art. 37.6 Cotonou: EU will provide trading regime that is ‘equivalent’ to Cotonou provisions  Only ‘alternatives; were and are the EU’s GSP system: 1.Standard GSP (open to most developing countries) 2.Everything But Arms - EBA 3.GSP+ (expanded GSP system linked to respect of core labour and human rights principles)  All ‘alternatives’ are problematic – WHY?  Standard GSP …  EBA …  GSP+…

4 Alternatives to EPAs. TIPS workshop March 20084 What are the alternatives to EPAs? 1.Standard GSP  267 products would face tariff jumps of over 10 percent ad valorem. Most affected products are beef, processed fruit, sugar, rice, bananas, citrus and horticulture. 2.EBA  Cotonou equivalent market access but only open for LDCs 3.GSP+  does not comprise all products (such as beef and sugar) but would be an alternative for some countries  Only open in 2009; Nigeria’s and Seychelles’ request was rejected in 2007.

5 Alternatives to EPAs. TIPS workshop March 20085 1. Non-EPA signatory LDCs  Biggest group of non-EPA signatory states  24 in Africa, 5 in the Pacific, 0 in the Caribbean  ESA: Djibouti, Eritrea, Ethiopia, Malawi, Sudan, Zambia  SADC: Angola  Direct monetary costs: limited  EBA fallback position  But: ‘Cotonou plus’ RoO do not apply  Indirect costs: non-quantifiable but can be substantial

6 Alternatives to EPAs. TIPS workshop March 20086 2. Non-EPA signatory developing countries  3 in Africa (Nigeria, Congo, Gabon) and 7 in the Pacific  Direct monetary costs: limited  Africa: only one item (raw sugar cane) for one country (Congo)  accounts for more than 1% of total exports and  faces ad valorem tariff jumps of more than 20%  Indirect costs: lower than for group 1

7 Alternatives to EPAs. TIPS workshop March 20087 3. Signatory LDCs that will not ratify an EPA  Currently 8 in Africa (none in West and Central), 1 in the Caribbean, 0 in the Pacific  ESA: Comoros, Madagascar  EAC: Burundi, Rwanda, Tanzania Uganda  SADC: Lesotho, Mozambique  Direct monetary costs for all: limited (EBA)  BUT: is it feasible for them to leave the EPA?  Motivation to join the EPA for Lesotho and all EAC LDCs? Mozambique? Madagascar?

8 Alternatives to EPAs. TIPS workshop March 20088 4. Signatory developing countries that will not ratify an EPA  Currently 10 in Africa, 2 in the Pacific, 14 in the Caribbean  ESA: Mauritius, Seychelles, Zimbabwe  EAC: Kenya  SADC: Botswana, Namibia, Swaziland

9 Alternatives to EPAs. TIPS workshop March 20089 4. Signatory developing countries that will not ratify an EPA  Number of products affected and monetary costs that would occur from being downgraded to GSP vary largely  Traditional commodity exporters and horticultural producers are affected worst  However, also Botswana (1.5% of EU total EU exports affected) would face costs:  Beef exports would face tariff increases worth 80% of 2006 export revenues;  Risk to lose other remunerative market niches when no longer being able to proof that it meets EU standards;

10 Alternatives to EPAs. TIPS workshop March 200810 Main messages  The costs of a non-EPA depend very much on the ‘status’ of the African country  Developing countries agricultural exporters are affected worst  A non-EPA is not feasible / does not seem desirable for all LDCs  The non-signatory EPA states have either  equivalent market access (EBA); or  comparatively little too loose.

11 Alternatives to EPAs. TIPS workshop March 200811  What should a country consider when opting for or against an EPA?  What would be the best strategy for your country?

12 What are the costs of a non-EPA? TIPS Workshop 5-6 March 2008


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