- Botswana, Lesotho and Swaziland today signed an interim Economic Partnership Agreement (EPA) with the European Union, opening their market access to Europe. Mozambique is said to be eager to join its signature to the pact as soon as possible.
This interim agreement secures EU market access for these countries while negotiations for a full EPA with the seven-country Southern African Development Community (SADC) are ongoing. The other members of the SADC EPA group are South Africa, Namibia and Angola.
Today's interim agreement, signed off by the trade ministers of Botswana, Lesotho and Swaziland in Brussels, does not include several outstanding controversial issues, which are to be discussed by a united SADC block in upcoming EPA negotiations.
EU Trade Commissioner Catherine Ashton said that the signature of the interim deal was "an important step. It first of all guarantees market access to the European market for those countries that have signed today. More importantly, it is a vote of confidence in the process that we have put in motion to build a strong and lasting economic and trade relationship," she added.
Neo Moroka, Minister for Trade and Industry of Botswana and Chair of the SADC group, agreed that the signing marked a significant milestone in our trade negotiations. It ensures uninterrupted flow of SADC EPA goods into the EU market. There are still some outstanding issues to be resolved. These will be negotiated in parallel with negotiations towards a full EPA, covering services and investment."
The government of Mozambique - also a SADC member - had signalled its intention to sign this agreement in the near future, but "its trade minister was unable to come to Brussels today," according to a EU statement.
Three other countries in the region, South Africa, Namibia and Angola, opted not to sign at this juncture. Angola as a Least Developed Country (LDC) maintains its duty-free quota-free access to the EU market under the 'Everything But Arms' (EBA) initiative.
South Africa-EU trade is governed by the Trade, Development and Cooperation Agreement (TDCA) signed in 1999, which allows preferential tariff rates for more than 90 percent of South Africa's exports to the EU.
The EU-SADC EPA is consistent with regional integration processes such as the larger SADC and the "SACU" or Southern Africa Customs Union, according to the negotiators. SADC has however been frustrated by the EU's hurry to sign new EPAs and its push to negotiate separately with SADC member countries.
But EPAs are important as the EU represents SADC's largest trading partner. In 2008, total trade flows with the EU for the four countries which have now signed, or are about to sign, were almost euro 2.1 billion. All four countries enjoyed individual trade surpluses with the EU – the combined surplus standing at around euro 1 billion.
In 2008 the main exports to the EU for the four countries were aluminium, diamonds, sugar, beef and fish. Their main imports from the EU were mechanical machinery, electrical machinery, fertilisers and vehicles.
"The SADC region as a whole has been a net beneficiary of trade with the EU up to now and the EPA will allow the region to improve competitiveness, diversify its exports, and build strong regional cooperation networks in support of those that currently exist or are being developed," according to the EU statement.
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