EU begins Pacific trade development negotiations

EU launches trade and development negotiations with the Pacific

Tomorrow, 10 September, the European Union will open negotiations for an Economic Partnership Agreement (EPA) with 14 Pacific countries. Meeting in Nadi, Fiji, EU Trade Commissioner Pascal Lamy will officially launch these negotiations which are aimed at promoting trade and development, and the eradication of poverty in the region.

Before leaving for Nadi, Pascal Lamy said: “The launch of negotiations with the Pacific region marks another stepping stone in our common efforts to make regional integration and trade contribute to development. Now that we have started talks with all six ACP (Africa, Caribbean and Pacific) regions, we should switch gear and move into full negotiating mood.”

EU Aid and Development Commissioner, Poul Nielson added: “With the EU Pacific launch the EPA process is now thoroughly on track. This is evidence that the EU and ACP countries are succeeding in making trade and regional integration work for development.”

The EPA launch, which will include a traditional Fijian welcome ceremony, is to be followed by a first negotiating session during which both sides will discuss a “Joint Roadmap.” The Roadmap will outline a timetable for the negotiations, which are to be concluded by the end of 2007 at the latest.

The Pacific ACP countries now opening negotiations with the EU have organised themselves regionally within the framework of the Pacific Islands’ Forum. The countries participating in the EPA are: Cook Islands, Fiji, Kiribati, Marshall Islands, Federated States of Micronesia, Nauru, Niue, Palau, Papua New Guinea, Samoa, Solomon Islands, Tonga, Tuvalu and Vanuatu.

Ahead of the EPA launch in Fiji, Commissioner Lamy is visiting New Zealand from 8-9 September. This will be an occasion to explain the logic of the EPA, exchange information and discuss the way forward. The on-going WTO talks under the Doha Development Agenda and other bilateral matters will also be discussed.

Commissioner Nielson will be in Fiji from 8-11 September, where a significant part of the visit will be devoted to bilateral discussions on EU development aid to Fiji. The Commissioner will hold talks with Fijian Prime Minister, Laisenia Qarase, the leader of the Fiji Labour Party, Mahendra Chaudhry, representatives of the private sector and the sugar industry. He will also sign the Education Sector Program which will receive an EU grant of €21 million from the European Development Fund in support of the Ministry of Education’s plan of achieving universal education.

Background to the EU-Pacific EPA

Economic Partnership Agreements (EPA) are foreseen under the Cotonou Agreement with 77 States in Africa, the Caribbean and the Pacific (ACP). They aim at helping these countries to foster development and regional integration as a stepping stone towards gradual integration into the world economy. The EPA will establish clear trade rules, be WTO compatible and will support trade in the Pacific through development cooperation. Negotiations were launched on 27th September 2002 in Brussels. The first phase of talks on the all ACP– EU level on 2nd October 2003 saw a preliminary understanding on general issues such as market access, trade-related areas, services and the development dimension of EPAs. Since then negotiations have been opened at the regional level with 5 ACP regions: Central and West Africa, Eastern and Southern Africa and the Southern African Development Community and the Caribbean.

EU-Pacific trade: facts and figures

Trade

EU imports from the Pacific region (Cook Islands, Fed. Micronesia, Fiji, Kiribati, Marshall Island, Nauru, Niue, Palau, Papua New Guinea, Samoa, Solomon Island, Tonga, Tuvalu, Vanuatu) reached €530 million in 2003, which represented an increase of 10.7% compared to 2002. The main products imported were palm oil (29%), sugar (18%), copper (9%) and coffee (9%).

The EU’s exports to the Pacific amounted to €210 million in 2003, which was a decrease of 62.5% compared to 2002. The main categories of products exported to the Pacific region in 2003 were transport goods (56.5%), machinery (19.7%), metals (5.2%) and chemical products (3.5%).

In 2003, the Pacific countries recorded their highest trade surplus with the EU since 1999, €300 million.

In 2002, the Pacific region’s main trading partner was Australia, which attracted 23% of the Pacific region’s exports compared to 10% to Japan, 9% to the EU and 7% to the US. In addition, 39% of the region’s imports in 2002 came from Australia, 15% from Singapore, 11% from New Zealand, 6% from Japan and 4% from the EU.

In 2003, the EU’s main trading partners in the Pacific region were Papua New Guinea, Fiji and the Marshall Islands. These countries accounted for 66.7%, 19.8% and 11.3% respectively of the region’s total exports to the EU. The main product exported from Papua New Guinea in 2003 was palm oil (42% of the total). Fiji exported predominantly sugar (92.1% of the total). As for the Marshall Islands, 88.7% of their exports to the EU consisted of transport-related goods (cruise ships, yachts).

Trade-related technical assistance

The European Commission has provided over €12 million for trade-related assistance in the Pacific Region. In 2003, the Commission approved a Regional Plan for preparation of EPA negotiations (€1.2 million), which covered studies, technical expertise and support for coordination meetings. The Commission is currently also funding a Pacific regional representation office at the WTO in Geneva (€260,000) and has approved in 2004 a €9.2 million programme for regional economic integration. Support for the fisheries sector is also envisaged.

In addition, the Pacific Region will also benefit from the €50 Million TRADE.COM Facility which will fund a network of national and regional trade advisors. This Facility, which is available to all ACPs, will also offer support for local research and training institutions.

The European Commission is the main provider of trade-related assistance for developing countries. Before the launch of the Doha Round, the EU allocated around €700 million of assistance over five years (1996-2000). Since the WTO meeting at Doha in 2001, these figures have increased considerably, with a global allocation of €2.8 billion for 2001-2004 and an average of close to €700 million annually.

For more information on ACP-EU trade relations go to:

>http://europa.eu.int/comm/trade/issues/bilateral/regions/acp/index_en.htm

Australia
Martin Dihm, from the European Commission's Trade Directorate-General, who has responsibility for trade relations and EPA negotiations with the Pacific, will brief the Australian authorities on the EPA negotiations on Monday 13 September and will be available for interview on that day. Dihm will also speak at the ANU's National Europe Centre at 6pm on the theme “Economic Partnership Agreements – what are they and what do they mean to Australia?”

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