EPA Negotiations: Where do we stand? - Pacific - last update : July 2011

State of play

In the Pacific region, Papua New Guinea (PNG) signed an Interim Economic Partnership Agreement (IEPA) with the European Union on 30 July 2009, closely followed by Fiji on 11 December 2009. PNG ratified the agreement early this year, while the European Parliement gave its consent to the agreement on 19 January 2011. According to an official statement from the EU, this agreement focuses on trade in goods only and provides duty free quota free access for all products from Fiji and PNG to the EU market. Both countries have also been able to secure an asymmetric and gradual opening of their markets to Europe, with PNG liberalising around 88% and Fiji liberalising up to 87% over a period of 15 years (excluding sensitive sectors such as fish, meat and vegetables).

Fiji and Papua New Guinea are the first two Pacific countries to benefit from a new preferential rule of origin for the export of processed fish and marine products to the European market provided under the EPA. Fish, regardless of their origin, are deemed to originate from these Pacific ACP countries as long as they are transformed from being fresh or frozen into a pre-cooked, packaged and canned product in Fiji or Papua New Guinea and can then be exported to the EU free of duties and quotas. This rule, however, is only being currently applied to PNG as Fiji is deemed not to be implementing the agreement.

A Pacific ACP Trade Ministers Meeting (PACPTMM) was held early January, in order to plan the way forward in regional EPA negotiations. No such meeting had been held since June 2009, and saw the adoption of PACP EPA 2011 strategy. This took place in the context of enduring controversy about what the appropriate forum for regional negotiations should be, with some PACP expressing discontent with the Pacific Island Forum Secretariat's (PIFS) handling of the negotiations.

The next round of Pacific-EU negotiations is subordinated upon the elaboration of a regional market access offer amongst PACP countries.

-> For details on the current negotiations, please consult our monthly EPA negotiations update.

Trade regime from 1 January 2008

Papua New Guinea and Fiji , who are the region's main exporters of goods to the EU, have initialled an interim agreement with the EC on 23 November 2007. Papua New Guinea then signed the interim agreement on 30 July 2009, and ratified it in January 2011.

Seven other non-LDCs ( Cook Islands , Federated States of Micronesia , Nauru , Niue , Palau , Marshall Islands and Tonga ) did not join the interim agreement so far and export to the EU under the GSP regime since 1 January 2008 . For most of these countries, the absolute export volume to the EU is low, however, it can be significant relative to their overall country exports and thus they may face serious disruption of trade.

The LDCs East Timor, Kiribati, Samoa , Solomon Islands , Tuvalu and Vanuatu export under the Everything But Arms initiative since 1 January 2008 .

Interim agreement between the EU and Fiji and Papua New Guinea

Text of the agreement:
Interim Partnership Agreement between Pacific States, on the one part, and the European Community, on the other part, published by the Council of the European Union as annex to a Council decision on the signature and provisional application of the agreement, 8 May 2009
-> liberalisation schedules:
* Customs duties on products originating in Pacific States (and summary of Fiji market access offer in the same document)
* Customs duties on products originating in the EC party:
Fiji: (part 1) (part 2) (part 3) (part 4) (part 5) (part 6) (part 7) (part 8) (part 9) (part 10) (part 11)
Papua New Guinea: (part 1) (part 2) (part 3) (part 4)
-> Annex III on technical barriers to trade and sanitary and phytosanitary measures
-> Protocols on mutual administrative assistance in customs matters AND on the definition of the concept of "originating products" (rules of origin) and methods of administrative cooperation (part 1) (part 2)
-> Final act

Summary of the agreement:
"Market Access Schedule
The offer of Papua New Guinea (PNG) foresees to liberalise the range of included products on the date of application of this agreement which has been announced by PNG to be the 01 January of 2008. The coverage of the offer is 88 % as regards the value of imports from the EU and 82 % as regards tariff lines. All sectors are covered.
The offer of the Republic of Fiji Islands ( Fiji ) foresees to liberalise 24 % of value of imports from the EU corresponding to 9 % of tariff lines on the date of application of this agreement which has been announced by Fiji to be the 01 January of 2008. Fiji will eliminate another 13% of value and 13 % tariff lines by the end of year 5, by the end of 10 years 41 % of value and 40 % of tariff lines and by the end of 15 years 4 % of value and 18 % of tariff lines. The coverage of the offer is 81.5 % as regards the value of imports from the EU and 80 % as regards tariff lines. All sectors are covered.

Agreement (Goods)
The agreement covers all major provisions of a trade in goods agreement such as provisions on customs duties, export taxes, a standstill clause, a non discrimination clause, trade defence instruments (anti-dumping and countervailing measures, multilateral and bilateral safeguards), special provisions on administrative cooperation in customs matters, a chapter on customs and trade facilitation, a chapter on technical barriers to trade and sanitary and phytosanitary measures as well as exception clauses.
The respective offers of the parties as well as the applicable rules of origin are set out in annexes attached to the agreement. The agreement also contains an annex on mutual administrative assistance in customs matters.

Agreement (other components)
This Agreement focuses on safeguarding the market access interests both of Papua New Guinea and Fiji and any other Pacific State that may still wish to join. It, hence, focuses on trade in goods aspects.
The Agreement contains also a clause on the ongoing EPA negotiations. The parties confirm their commitment to these negotiations and to the objective of concluding a comprehensive EPA containing all relevant components and including all interested Pacific countries by the end of 2008. The Agreement also emphasises the need to cooperate closely at the national level to maximise the synergies between development cooperation and the objectives of this Agreement.
The Agreement also contains provisions regarding on the relation with the Cotonou Agreement and WTO as well as a dispute settlement mechanism, institutional provisions, and general and final provisions."
(Summary provided by the European Commission, keywords highlighted by acp-eu-trade.org editors)

Relevant documents and websites

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