Seek for more time, EAC advised

Capital News, March 26, 2008

An Asian trade lobby group is now urging the East African Community (EAC) to consider asking for more time from the European Union (EU) to come up with a comprehensive Economic Partnership Agreements (EPAs).

Cuts International Project Officer Victor Ogalo told Capital Business News that the EAC, which negotiates under the Eastern and Southern African (ESA) configuration, lost three months of negotiation time after Kenya’s December 27 disputed election thus the need for an extension.

Observing that trade negotiations are intricate, the official said there was need for the region to rally behind their West African counterparts who have asked for a two-year extension.

“There is still space to negotiate for more time. EAC should be accorded the same treatment as its West African colleagues that have been granted two more years,” he remarked.

The regional body (EAC) signed an interim pact with the EU in November 2007 and was given until December 2008 to arrive at a trade accord that would spell out how relations between the two regions would be conducted.

The joint framework agreement guarantees duty free and quota free market access to the EU.

The framework was signed with just under a month to the December deadline that had been issued by the EU to the African, Caribbean and Pacific countries.

Kenya’s and indeed the East African region trade with Europe is largely hinged on primary commodities such as tea, coffee and horticultural products.

The provisional deal saved Kenyan investments and the economy billions of shillings through safeguarding sectors such as horticulture and agriculture.

The treaty ensured that products from these sectors continued to have access to the European market until the end of 2008 or until a comprehensive framework was agreed on.

Failure to do so would have opened up the regional economies to competition with European products.

It would have seen Kenya’s trade disrupted leading to a loss of over Sh70 billion in annual exports, the collapse of local industries which would then have a multiplier effect of the massive layoffs and a host of other implications.

Ogalo said the animosity between the EAC and its parent bloc ESA, which consists of 12 other countries, was also likely to slow down the discussions

The bad blood arose after Kenya led fellow EAC states in signing the temporary pact without consulting the ESA bloc, a development that was seen by many as a deliberate move to break away from the configuration.

EAC is an amorphous body in the negotiations as only six groups including ESA are recognized in the discussions.

The parties have been trying to work out their differences since the second round of the talks started in February 2008 in Lusaka, Zambia.

“This was an extraordinary session that was meant to revisit what was signed (in November 2007) and come up with a new framework,” Ogalo explained.

He however expressed optimism that an agreement could be reached soon as there was political will from all parties involved.

Local industries will be waiting on bated breath to see if and whether a treaty can be worked out before the end of this year otherwise, their goods will attract higher tariffs and face the danger of collapse.

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