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Towards Equitable Agricultural Development in the EAC:

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Title: Towards Equitable Agricultural Development in the EAC: An Analysis of the Multilateral Trading System Author: Julien Grollier Last modified by – PowerPoint PPT presentation

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Title: Towards Equitable Agricultural Development in the EAC:


1
Towards Equitable Agricultural Development in the
EAC
An Analysis of the EPA between the EU and the EAC
  • Fostering Equitable Agricultural Development in
    Africa (FEAD) Project

2
Structure of the Presentation
  • Agriculture Related Provisions in the Framework
    EPA
  • Potential for Equitable Agriculture Development
    in the Framework EPA
  • Investment for increased productivity
  • Reform of international and regional disciplines
    in agriculture
  • Redressing agriculture related trade constraints
  • Capacity building of small and medium sized
    farmers
  • Multi-stakeholder consultation and coordination
  • Concluding Remarks and Way Forward

3
Current Content of the FEPA
  • Chapter I - General Provisions
  • Chapter II - Trade Regime for Goods
  • Chapter III - Fisheries
  • Chapter IV - Economic and Development Cooperation
  • Chapter V - Areas of Future Negotiations
  • Including Special Chapter on Agriculture
  • Chapter VI - Dispute Avoidance and Settlement,
    Institutional, General and Final Provisions
  • Protocol I - Concerning the Definition of the
    Concept of Originating Products and Methods of
    Administrative Cooperation
  • Protocol II - On Mutual Administrative Assistance
    in Customs Matters

4
Agriculture Related Provisions in the FEPA
Trade in Goods
  • The FEPA provides for duty free and quota free
    (DFQF) market access for all EAC exports to EU
    with special safeguard provisions for sugar until
    2015
  • The EAC will liberalise 82 percent of EU imports
    over a period of 25 years

Phase of liberalisaion Percentage of total trade liberalisation Goods liberalised
2008 2010 64 Raw materials and capital goods (CET 0)
2015 2023 16 Intermediate goods used in the production process (CET 10)
2020 2011 2 Finished goods (CET 25)
Total liberalisation 82
Excluded from liberalisation 18 Mostly agricultural products but also some industrial goods
5
Agriculture Related Provisions in the FEPA
Rules of Origin
6
Agriculture Related Provisions in the FEPA
Export Taxes
7
Agriculture Related Provisions in the FEPA
Non-Tariff Measures
  • Ensuring transparency in accessing the EU market
  • Increased access for EAC agricultural products
    in the EU market
  • BUT
  • It is also necessary to train and assist SMFs so
    as to enable them to comply with standards and
    regulations
  • The imposition of non-tariff measures is
    prohibited
  • Quotas
  • Export or import licenses
  • Exceptions
  • Measures are applied to prevent or relieve
    critical shortages of food
  • Restrictions are necessary to the application of
    standards or regulations in international trade

8
Agriculture Related Provisions in the FEPA
Safeguards
  • The EPA allows for multilateral and bilateral
    safeguards, and includes special provisions for
    infant industries ...
  • ....BUT
  • burdensome procedures
  • time limit after which clear elements are
    required leading to the elimination of the
    measure
  • no special safeguards for agriculture
  • only temporary distortions are addressed whereas
    distortions in agricultural trade are rather of
    structural nature

9
Agriculture Related Provisions in the FEPA
Development Cooperation
  • EAC has drafted a Text on Agriculture (2009) and
    a Text on Economic and Development Cooperation
    (2011)
  • Areas of development cooperation of both texts
    need to be harmonised
  • Chapter on development cooperation should allow
    for the retention of mechanisms favourable to
    development and exclude mechanisms hindering
    development
  • Revenue loss due to binding liberalisation should
    be caught by binding development support
  • Until now only objectives
  • EU confirms to continue its financial
    contribution to
  • 10th European Development Fund
  • Aid for Trade
  • No new specific commitments under FEPA
  • Development cooperation will be further
    considered in the next phase of negotiations

10
Potential for Equitable Agriculture Development
in the Framework EPA
11
Potential for EAD in the FEPA Increased
investment leading to improved productivity
  • DFQF Market Access
  • Can create incentives for increased investment in
    the agricultural sector leading to
  • Improved productivity
  • Diversification
  • Import of capital goods
  • Spill-over of technology

Main target of investment should be small and
medium sized farmers
12
Potential for EAD in the FEPA Increased
investment leading to improved productivity
  • Rules of Origin
  • simplified rules of origin provide more certainty
  • Possibility of cumulation provides for value
    addition and diversification and can increase
    export activity in agricultural products

13
Potential for EAD in the FEPA Increased
investment leading to improved productivity The
Way Forward
  • Chapter on Agriculture has to include provisions
    on
  • promotion of joint ventures and mixed investments
    in general
  • facilitation of access to credit facilities for
    small and medium sized farmers
  • Chapter on Development Cooperation has to include
  • Binding commitments to achieve a better
    infrastructure and better technological inputs
  • Binding commitments to compensate revenue loss as
    a result of liberalisation through development
    support

14
Potential for EAD in the FEPA Reforming
international and regional disciplines in
agriculture
  • Negotiating the FEPA as a bloc strengthening
    regional integration
  • creation of larger markets
  • generating small and medium sized farmers
    activity
  • Improved food security by allowing the movement
    of goods from surplus to deficit areas within and
    outside the EAC
  • Safeguards address the essential issues but fail
    to be effective due to time limitations and
    cumbersome procedures
  • The use of subsidies should be confined

15
Potential for EAD in the FEPA Redress of
trade facilitation constraints
  • Need for a specific development fund under FEPA
    aimed at
  • Improving customs administration,
  • building better infrastructure networks,
  • capacity building of small farmers,
  • harmonisation of the regulatory frameworks within
    the EAC
  • etc.
  • Need for binding commitments aiming at improving
    the agricultural private sector that go beyond
    traditional technical assistance and include real
    transfer of know-how and technology

16
Potential for EAD in the FEPA Capacity building
of SMFs
  • the EPA fails to explicitly address
  • Better access to production technologies, product
    quality enhancements and direct linkages to the
    market for SMFs
  • Better information of SMFs on how to use
    commercial, technical, scientific and financial
    opportunities under the EPA

17
Potential for EAD in the FEPA Multi-stakeholder
consultation and coordination
  • As promoted in the Cotonou Agreement, some
    multi-stakeholder consultations in EPA
    negotiations were conducted
  • BUT
  • no mechanism to ensure neither the taking into
    account of the stakeholders views nor the
    information of stakeholders about final outcomes
  • parliamentarians, consumer associations, trade
    unions, small business, informal sector, and
    farmers are not always members of these fora
  • multiplicity and sometimes ad-hoc nature of
    consultative mechanisms hamper regular and
    effective participation

18
Potential for EAD in the FEPA Multi-stakeholder
consultation and coordination
  • The East African Business Council (EABC)
  • smallholder farmers are not well represented thus
    they lack the ability to own policy
    implementation let alone policy-making
  • The informal sector
  • should also be recognized as a stakeholder and
    its participation in negotiations should be
    seized
  • Including the informal sector as a stakeholder in
    the EPA negotiations would eventually
  • transform informal activity to formal activity,
  • increase government revenues
  • enhancethe agricultural sector by making
    technology and finance available for a greater
    number of beneficiaries.

19
Concluding Remarks The way forward for national
governments
  • National governments need to
  • provide stakeholders with information on how they
    can effectively harness opportunities provided
    for under the EPA
  • establish channels through which all stakeholders
    can participate in consultations on the ongoing
    negotiations and be informed about final outcomes
  • establish mechanisms which ensure that their
    views, opinions and proposals are taken into
    account
  • harmonise regional and national strategies
  • allocate resources to sectors that are likely to
    benefit most from the EPA

20
Thank you !
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SwitzerlandPh 41.22.734.6080Fax41.22.734.391
4Email geneva_at_cuts.orgWeb http//www.cuts-grc.
org/
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