Venerdì, Marzo 29, 2024
Italian (Italy)English (United Kingdom)

Desiderio Consultants Ltd. è una think tank ed una rete di consulenti internazionali per lo sviluppo indipendenti costituita per promuovere ed influenzare politiche doganali e commerciali nei Paesi Africani, al fine di raggiungere riforme di facilitazione del commercio che favoriscano la crescita degli scambi commerciali a livello internazionale e regionale
Creativity, Commitment to Excellence, Results

Tanzania denies rumours about imminent signature of the EPA with the EU

There are no translations available.

A press release issued by the Ministry of Investment, Industry and Trade of Tanzania clarifies that rumours about the decision to sign the Economic Partnership Agreement (EPA) with the European Union (EU) are not true and the position of the country remains unchanged.

EPAs are reciprocal free trade agreements where each Party (the EU and its member States on one side, and the EPA partner countries on the other), offers duty-free access to its respective markets in an asymmetrical way, because while the EU allows access to its markets in unlimited quantities for all products originating from EPA partners, EPA partners open their markets only partially to the EU, in a measure that varies from EPA to EPA, and sometimes from country to country within the same EPA. For instance, the EPA that the EU has in place with the five ESA (Eastern and Southern Africa) countries (Comoros, Madagascar, Mauritius, Seychelles and Zimbabwe) foresees for Seychelles a market openness share to EU products of 97,40%, the highest among African countries, due to the high-income revenue status of the country and the limited diversification of the Seychelles exports, being mainly concentrated on fish and fish products. It must be remembered that the ESA group is a regional configuration - derived from the amalgamation of many other regional groups - which was specifically created by several African countries in the East ans Southern regions for the specific purpose of negotiating an EPA with the EU.

Economic Partnership Agreements have their legal basis in the Cotonou Partnership Agreement (2000), which envisaged at art. 37 the possibility for the EU and Africa, Caribbean and Pacific (ACP) countries to negotiate specific development-oriented free trade arrangements aimed at promoting sustainable development and poverty reduction and the gradual integration of African economies into global markets, among others. The Cotonou Agreement, initially due to expire in February 2020, has been extended until replacement by a successor agreement called ‘Post-Cotonou Agreement’, whose negotiations were concluded on 15 April 2021 and is currently being signed by its Parties. This Agreement however will become binding only after completion of the national ratification processes by all parties concerned.

Five out of the six East African Community States finalised the negotiations for an Economic Partnership Agreement (EPA) with the EU on 16 October 2014 (at that time South Sudan was not yet an EAC member). Kenya and Rwanda signed the EPA in September 2016, and Kenya also ratified the agreement in the same year. However, for the EPA to enter into force, all EAC members need to sign and ratify the agreement.

Most of the EAC countries (Kenya and Tanzania are an exception), are on the UN’s list of Least Developed Countries (LDCs), which means that all their products (excluded arms) already access duty-free the EU market under the Everything But Arms (EBA) initiative, which is a sub-regime of the EU Generalised System of Preferences, a unilateral (non-reciprocal) trade arrangement scheme addressed to developing and less developed countries which is articulated in 3 sub-regimes, each one granting a different set of tariff preferences to group of countries included in specific lists. The most favourable of such sub-regimes, the EBA, is reserved to those countries with an LDC status.

So far, the signing of the EPA has been delayed because some EAC states wanted a provision for special export taxes in order to protect certain sectors they consider sensitive (especially agriculture) and to discourage the exportation of raw material to Europe. Tanzania, instead, decided not to sign it as they were already benefiting from a duty-free access to the EU under the EBA.

The acceptance by Tanzania to sign the EPA with the EU has been criticised by many observers, who believe that this decision could put the existing local industries in jeopardy and discourage the development of new industries. However, things have now changed as the country in 2020 lost the LDC status, having graduated to a lower-middle income country, which means that it will soon lose the preferential access to the EU market under the EBA initiative and will transition to the Standard GSP scheme (which provides for a reduction or full removal of customs duties on 2/3rd of EU tariff lines), or if the relevant requirements are met, to the more favourable GSP+ (if the country demonstrates that implements 27 international conventions related to human rights, labour rights, protection of the environment and good governance). For the moment, however, the proposal of the EU Commission COM/2021/579 final of revision of its GSP (expiring at the end of 2023), still includes Tanzania in the list of beneficiaries of the EBA arrangement.


View Danilo Desiderio's profile on LinkedIn

 

Copyright © 2011

Desiderio Consultants Ltd., 46, Rhapta Road, Westlands, Nairobi (KENYA)