Current developments

A meeting of the COMESA ministerial task forces on EPAs and on the customs union took place on 10-11 February in Lusaka .
Discussions on EPAs included the implementation and review of the interim agreement, including the establishment of an EPA committee, as well as the coordination between ESA, EAC, SADC and the AU.
On the customs union, COMESA ministers underlined the importance of harmonising the trade regimes of COMESA, EAC and SADC, in particular with respect to the Common External Tariff and related trade policy areas as well as overlapping membership. This statement follows a similar proposal by EAC ministers for the formation of a wider free trade area encompassing COMESA and SADC.

The first Ministerial Monitoring Committee of the COMESA fund was held in Mauritius on 31 January 2008 . Additional international support for the fund will be sought under the Aid for Trade initiative, including from the AfDB, EC, IMF and World Bank. An extraordinary meeting of the committee is planned for the first week of April to accelerate the establishment of the fund

A Special ESA RNF meeting was held on 16-17 January at the COMESA secretariat in Lusaka . This first meeting of the ESA group since the signing of the Framework Agreements addressed the process and outcome of the EPA negotiations so far, the implications and implementation of the interim agreement as well as the way forward in negotiating a comprehensive EPA and safeguarding regional integration processes.
According to press reports , an issue that remains to be resolved relates to the participation of the EAC members in the COMESA customs union, due to come into effect by the end of 2008. The COMESA secretariat plans to analyse the different interim agreements initialled in the subregion to coordinate regional integration programmes by April 2008.

The post-election crisis in Kenya means that the East African Community (EAC) may be unable to establish a common market by its target date of January next year. The EAC had set the target date for ratifying the Common Market Protocol for June 2009, expecting to officially launch it in January 2010.

Trade regime from 1 January 2008

Two interim agreements have been initialled in the Eastern and Southern African region, an ESA-EU framework agreement and an EAC-EU framework agreement. These are expected to lead to two full EPAs by the end of 2008 and by July 2009 respectively.

Those countries in the region that have not initialled an interim agreement (or have done so without submitting a market access schedule, as in the case of Zambia ) are exporting under the EBA initiative since 1 January 2008 , for which they are eligible due to their LDC status. These are Djibouti , Eritrea , Ethiopia , Malawi , Sudan and Zambia .

ESA-EU framework agreement

Text of the agreement:
--> ESA-EU framework agreement

Summary of the agreement:
"The European Commission initialled an interim trade agreement with the Seychelles and Zimbabwe of the ESA region in Brussels on 28 November 2007 , with Mauritius on 4 December 2007 and with Comoros and Madagascar on 11 December 2007 . The deal includes a WTO-compatible market access schedule, provisions on development cooperation, fisheries and other issues. Negotiators confirmed that the agreement is open to other parties in the region, who are expected to join in the near future. The agreement is a framework towards the completion of a comprehensive Economic Partnership Agreement by the end of December 2008.

Goods Covered
The agreement allows for 100% liberalisation by value by the EU as of 1 January 2008 , with transition periods for rice and sugar. The Seychelles will liberalise 97,5% of its imports from the EU by 2022: 62% of their imports will be liberalised after five years, 77% by 2017 and the remaining 20,5% by 2022. Zimbabwe will liberalise 80% of their imports from the EU by 2022: 45% by 2012 with the remaining 35% of their imports being liberalised progressively until 2022.
Mauritius , on its part, will liberalise 95.6% of its imports from the EU: 24.5 % in 2008, 53.6% by 2017, and the remaining 42% will be liberalised in 2022. Coverage for Comoros and Madagascar is over 80% of their imports from the EU. In the case of Comoros , 21,5% of their imports will be liberalised after five years, and the remaining 59,1% will be progressively liberalised by 2022. In the case of Madagascar , 37% of their imports from the EU will be liberalised after five years, the remaining 43,7% will be progressively liberalised y 2022.

Goods Excluded
Several products from different sectors have been excluded from liberalisation, mainly due to the need to protect sensitive products or infant industries in the countries. In the case of Seychelles , these include meat, fisheries, beverages, tobacco, leather articles, glass and ceramics and vehicles. In the case of Zimbabwe , excluded products include products of animal origin, cereals, beverages paper, plastics and rubber, textiles and clothing, footwear, glass and ceramics, consumer electronics and vehicles. Mauritius excluded from liberalisation live animals and meat, edible products of animal origin, fats, edible preparations and beverages, chemicals, plastics and rubber articles of leather and fur skins, iron & steel and consumer electronic. In the case of Comoros , the excluded goods are mainly of animal origin, fish, beverages, chemicals and vehicles. For Madagascar , the excluded products comprise meat, fish, products of animal origin, vegetables, cereals, beverages, plastics and rubber, articles of leather and fur-skins, paper and metals among others.

Other features
The Parties will cooperate to facilitate the implementation of the Agreement and support regional integration and development strategies. They agreed that cooperation will be based on the ESA Development Cooperation Strategy and a jointly agreed Development Matrix. They will cooperate to mobilise resources additional to the financial framework of the EU, from EU Member States and other donors, in particular expanding Aid for Trade commitments, relating specifically to EPA support requirements and adjustment costs.
The agreement contains an extensive fisheries chapter, mainly aiming at reinforcing cooperation on sustainable use of resources."
(Summary provided by the European Commission, 19 December 2007 )

EAC-EU framework agreement

Text of the agreement:
--> EAC-EU framework agreement

Summary of the agreement:
"On November 23 in Uganda the European Commission and the East African Community initialled an interim EPA agreement. This agreement will apply to the EU and to Kenya , Uganda , Tanzania , Rwanda and Burundi . Negotiators agreed that the first phase of negotiations for an EPA had been successfully completed and that they would continue negotiations towards a full EPA in 2008 and a rendezvous clause is included in the agreement to this effect.

Goods Covered
The agreement allows for 100% liberalisation by value by the EU as of 1 January 2008 (with transition periods for rice and sugar) and 82% liberalisation by value by the East African Community (64% in two years, 80% in 15 years, the remainder in 25 years). It covers 100% of EU tariff lines and 74% of EAC tariff lines.

Goods Excluded
Exclusions include: agricultural products, wines and spirits, chemicals, plastics, wood based paper, textiles and clothing, footwear, glassware. The main criterion of these exclusions is the desire to protect infant industry.

Other features
The agreement contains an extensive fisheries chapter, mainly aiming at reinforcing cooperation on sustainable use of resources."
(Summary provided by the European Commission, 19 December 2007 )

Regional configuration

Progress in negotiations has been challenged by the heterogeneous composition of the region in terms of the level of development of the negotiating countries. Out of 15 countries in the ESA region, 11 are LDCs that retain duty and quota free access to the EU market even in absence of an EPA, based on the Everything But Arms (EBA) initiative. Hence, for these countries the need to conclude an EPA is less urgent than for the four middle-income countries ( Kenya , Mauritius , Seychelles and Zimbabwe ), which were facing the threat of a significant increase in tariffs on their exports to the EU.

The ESA countries have been negotiating together since 2004, however on 14 November 2007 , the East African Community decided to conclude a separate EAC-EC agreement. The remaining ESA countries concluded a framework agreement with the EC that comprises separate national tariff offers and exclusion lists but a common text on other areas.

East African Community
Heads of state of the East African Community (EAC) agreed on 20 August 2007 to move towards completing an EAC-EPA with the EU, independently from the other ESA members. So far, four of the five EAC member states, Burundi , Kenya , Rwanda and Uganda had been negotiating under the ESA -EPA configuration, whereas Tanzania had been negotiating with the SADC-EPA grouping.

The decision in favour of an EAC EPA reflects the fact that the EAC members already form a customs union. On 12 October 2007 , the EAC members decided to harmonise their negotiation positions and prepare an own regional market access offer to be tabled in both ESA and SADC meetings. EAC ministers indicated that they plan to retain the common taxation regime of the region under an EPA. Following consultations held on 23-24 October 2007, the EAC and COMESA secretariats issued a joint statement declaring that both the EAC countries and the ESA countries excluding the EAC countries would submit separate market access offers to the EC.

On 14 November 2007 , the first EAC-EC meeting on EPA negotiations took place, where ministers agreed to conclude an EAC-EC EPA text. As a stepping stone towards this EAC-EC EPA, ministers decided to work towards a framework agreement covering trade in goods, development cooperation and fisheries, to enter into force on 1 January 2008 . Such a framework agreement has been initialled on 27 November 2007 .

Comoros , Madagascar , Mauritius and Seychelles (CMMS)
At an extraordinary meeting of the Indian Ocean Commission Council , ministers of Comoros , Madagascar , Mauritius and Seychelles (CMMS) decided to build a sub-group within the ESA configuration in order to accelerate the negotiation process and the conclusion of an EPA by the set deadline. They decided to adopt a common CMMS market access offer as well as a common position on development aspects of an EPA as a precautionary measure for the case that ESA negotiations may not be completed by 31 December 2007 . In the following, the CMMS countries were expected to conclude the framework agreement outlined at the ESA-EC ministerial meeting on based on a collective market access offer.
Finally however, all CMMS countries have initialled the framework agreement with the EC, but each of them submitted a separate market access offer.

Zimbabwe
Zimbabwe has initialled the ESA framework agreement based on a separate market access offer.

Djibouti , Eritrea , Ethiopia , Malawi , Sudan and Zambia
Being LDCs, these countries are able to export to the EC under the EBA initiative after expiry of the Cotonou preferences without signing the framework agreement.

Zambia has initialled the ESA-EC framework agreement without taking on obligations in the trade part. Malawi is also expected join the agreement. However, as neither of them has submitted a market access offer, Zambia and Malawi export to the EU under the EBA regime from 1 January 2008 .

Democratic Republic of Congo
The Democratic Republic of Congo is currently negotiating both the ESA and the CEMAC EPA configurations; it remains to be decided with which regional grouping the country will sign an EPA.

Next meetings

A joint ESA-EC Ministerial meeting is scheduled for 3 March 2008 .

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