Executive summary

Annex ‘D’

SUMMARY ‘EVERYTHING BUT ARMS’ (EBA)

EC Regulations on General Trade Preferences 2501/2001 & 416/2001
On 26^th February 2001 the General Affairs Council of the European Union adopted the EBA Amendment to the EU’s General Scheme of Preferences. The salient points of the EBA regime are as follows:

1. 
   Applicable only to Least Developed Countries (LDCs)
   
2. 
   Extends duty and quota free access to all products emanating from LDCs except arms & ammunition and including alcoholic beverages and agricultural products EXCEPT:
   

• 
  Fresh Bananas: full liberalisation between 2001 & 2006 by reducing the EU Tariff 20% per annum.
  
• 
  Rice: full liberalisation to be phased in between September 2006 and September 2009, gradually reducing the EU Tariff to zero;
  

• 
  LDC rice can enter Europe duty free within a set quota
  
• 
  Initial quotas will be based on best LDC exports plus 15%. The quota will increase 15% per annum to 6696 tonnes in 2008/9 from 2517 tonnes in 2001/2.
  

• 
  Sugar: full liberalisation to be phased in between July 2006 and July 2009 by gradually reducing the EU Tariff to zero.
  

• 
  As for LDC Rice, raw sugar can be imported duty free within a quota which will grow to 197 355 tonnes in 2008/9
  
• 
  Imports of sugar under the ACP-EC Sugar Protocol shall be excluded to uphold the viability of the protocol
  

CAVEATS

1. 
   All goods Imported into Europe on the EBA scheme are subject to extremely strict Rules of Origin and administrative co-operation legislation to safeguard against abuses of the system.
   
2. 
   The Agreement Expires in 2010
   

Source: Regulations EC416/2001 and EC 2501/2001

http://europa.eu.int/comm/trade

Annex ‘E’
DEVELOPMENT CONSEQUENCES OF ENLARGED EU FOR ACP

1. 
   All new members of the EU automatically become accessory to the Cotonou agreement and are bound by the same terms as other member states which means that they are bound to provide development assistance in the same way as the original member states.
   
2. 
   However most new member states have a GNI per capita similar to Venezuela and will not be able to make a significant contribution. They are not expected to contribute to the 9^th EDF and the demands of enlargement may place the 10^th EDF under some pressure.
   
3. 
   Three of the new economies (Slovenia, Malta & Cyprus) can be classified as high income countries and will likely meet their aid targets.
   
4. 
   The other new states have GNI income similar to South Africa, Botswana & Gabon, all of whom are aid recipients and will only approach their targets through EC budget contributions to their economies.
   
5. 
   It is estimated that there will be a “gap” of some US$1.022bn between the ambitious Monterrey targets set for donors and actual receipts from new member states (estimated 2006 figures). Some of the largest member states (such as Germany, will need to increase their ODA substantially to reach the minimum target of 0.33%.
   
6. 
   Overall spending by the EU in general on EDF in real terms has been in decline while ODA spending has quadrupled since 1975. This is a result of substantial EU commitments to neighbouring countries, in particular Balkan States, Newly Independent States and the Mediterranean. It is likely that limited increases in the EDF will continue in the immediate aftermath of the Enlargement process while Europe is caught up in efforts of reform of agriculture and structural operations.⁹¹
   

Net ODA Disbursement from EC Budgets and payments into the EDF (US$s)

Source: Final report : Consequences of enlargement for development policy Vol 1, Aug 2003

www.europa.int

TRADE IMPLICATIONS OF EU ENLARGEMENT FOR ACP

1. 
   Enlarged EU market will account for 20% of all world trade and 50% of world outward direct investment all of which will be available to the ACP Member states.
   
2. 
   Some tariffs will see overall rise but will not affect LDCs trading under the EBA system. Non LDC States generally underfill their quotas so should not be affected.
   
3. 
   Tariffs in other areas will fall, eg tobacco but there is concern that the limited marketing ability of the ACP States could limit the value of the opportunities.
   
4. 
   Imposition of the stricter EU standards of food safety could reduce markets or their value.
   
5. 
   Inadequate marketing and inability to react quickly may mean that opportunities, for example increased demand for fresh bananas will be missed.
   
6. 
   Demand for quality beef is increased and an opportunity for exports to the EU over and above quotas exists.
   
7. 
   EU will be exporting quantities of lower quality meat which might threaten local ACP market structures. Since 1996 meat exports to the ACP ex EU have increased 122%.
   

EU Exports (in €millions) of Meat to the ACP Group

Adapted from EC Annual reports ‘Agricultural situation in the European Union’

8. 
   Sugar quotas and exports will be affected by the change in the support price regime.
   

The major lesson for the ACP to learn from the enlargement of the EU is that competitiveness has to be improved if the agricultural sector is to survive the opening of markets. This point has to be clearly understood and taken forward in EPA negotiations for structural support in this area. The table below indicates how little support has been given to this area to date.

Adapted from : Discussion Paper “Implications for EU Enlargement” http://agritrade.cta.int

The comments of commissioner Byrne⁹² serves to sum up the dilemma of the ACP Group with respect to the enlargement of the EU particularly within the agricultural sector:
Unless there is a serious effort to … strengthen the capacity of developing countries to meet the food safety standards of the developed world, the opportunities presented by trade liberalization in the food area may prove illusory


Annex ‘F’

PREAMBLE TO THE GEORGETOWN AGREEMENT

THE GOVERNMENTS OF THE AFRICAN, CARRIBEAN and PACIFIC STATES, hereafter referred to as the ACP States;
DESIROUS of contributing through continued and concerted endeavours to the reinforcement of solidarity of developing countries;
HAVING REGARD to the EEC – Lomé Conventions and the ACP - EC Partnership Agreement signed on 23 June 2000 in Cotonou, hereinafter referred to as the ACP – EC Partnership Agreement;
HAVING REGARD In particular to the Suva Declaration, the Montego Bay Plan of Action and the Harare Declaration on intra ACP Co-operation;
TAKING INTO ACCOUNT the conclusions of the summits of the Heads of State and Government of the ACP States held at Libreville on 6-7 November 1997 and at San Domingo on 25-26 November 1999;
AWARE of the profound changes in the international, political and economic environment;
REAFFIRMING their commitment to the respect for human rights and the rights of peoples, democratic principles and the rule of law;
DESIROUS of consolidating and reinforcing the existing solidarity and unity of the ACP states and of promoting improved co-operation between their peoples on the basis of interdependence, complementarity and mutual interest;
DETERMINED to promote and develop greater and closer trade, economic, political, social and cultural relations between the ACP States;
RESOLVED to ensure a firm foundation in their respective countries for human centred, equitable and sustainable development;
RECOGNISING the importance of regional integration, intra-ACP co-operation among ACP and other developing countries as a means of promoting the socio-economic development of ACP States;
CONVINCED that the realisation of sustainable development, the eradication of poverty, illiteracy and disease as well as the gradual smooth integration of ACP States into the global economy are legitimate objectives reflecting the aspirations of our peoples;
DETERMINED to ensure that the ACP-EC Partnership Agreements constitute the realisation of the common aspirations of developing countries to self reliant, endogenous and self-sustained development based on their systems of cultural and social values;
COGNISANT of their need to maintain and expand the multifaceted relations with other states and international organisations;
RECOGNISING the importance of solidarity and unity in co-operation among ACP States;
DESIROUS of enhancing the political identity of the ACP Group to enable them to act and speak with a single voice in all fora and organisations; and
RESOLVED to establish the Africa, Caribbean and Pacific Group of States at achieve common objectives so as to contribute towards the realisation of a new, fairer and more equitable world order.

Annex ‘G’
The Santo Domingo Declaration and Plan of Action 1999

Declaration: Chapter 2 Paragraph 6 ‘…. we intend to make a positive contribution towards any international action aimed at establishing peace, security, stability, solidarity and an equitable distribution of the fruits of world economic expansion’. Chapter 6, Paragraph 43 ‘We reaffirm the increasingly important political and economic role that other international actors play on the world scene and the need to establish appropriate relations with them. In this context, we reiterate the urgent need to establish closer political links with the States and regional organizations of North Africa, the Middle East, Asia and North and Latin America on the one hand, and with the other international organizations on the other hand…..’. Plan of Action: Paragraph 12 ‘We mandate the Council of Ministers to establish a Forum composed of inter-governmental regional integration institutions of the Group, with a view to reinforcing the process of regional integration…..’, Paragraph 14 ‘We mandate the Council of Ministers to initiate action for urgently pursuing closer political and economic relations with other regional and international organizations and other regions including North Africa, the Middle East, Asia and North and Latin America. The Council should ensure that the Secretariat puts in place the necessary mechanism for the implementation and follow-up of this mandate’ Paragraph 15 ‘We renew the mandate given to the ACP Council of Ministers by the First summit and request it to speed up the process of reforming the ACP and the ACP-EU institutions to enable them to respond more effectively to ongoing changes’.

Source: The Santo Domingo Declaration ACP/28/015/99 Final