Briefing on the Economic Partnership Agreement

Christian Peters, Head of Macro-economic and Trade SectionDelegation of the European Union to the Republic of Ghana

25 June 2015

Free Trade is one of the cornerstones of the European Union: seen as essential tool to boost growth and prosperity in our MS

The Economic Partnership Agreement can bring similar gains to Ghana & West Africa

The EU is Ghana's top trading partner with a trade volume of 6.5 Billion EUR annually, taking half of Ghana's total exports (EUR 3 Billion)

EU is the largest investor in Ghana and the largest provider of ODA.

Paradigm shift towards more focus on Trade & Investment

The EPA is the key tool to accompany this paradigm shift.

Economic Partnership Agreement (EPA) - Context

The EU had granted trade preferences to Ghana and all ACP since the Lome convention signed in 1975

These trade preferences have not been successful in integrating ACP countries into the global economy. The proportion imports from ACP countries to the EU has dropped from 7% to 3% since 1975

Furthermore, preferences have been challenged at the WTO

The EPA seeks to address these challenges: A stable and predictable trade and economic partnership, compatible with WTO rules.

Economic Partnership Agreement (EPA) - History

• Facilitate and intensify trade between ECOWAS and EU• Predictable long-term access to most important export

market with 500 Million consumers• Attracting investment and jobs, tech and skills transfer• Promoting diversification and better integration into

global value chains• Promote reforms to improve business climate: modern

tax system, transparency of public procurement, competition, customs rules, etc.

EPA –Objectives

Duty-free and quota-free access to the EU market for an unlimited period from day 1.

Asymmetric and gradual opening of the Ghanaian market to European goods: Ghana liberalizes 75% of its imports from the EU over 20 years, starting 2020..

Fully based on the ECOWAS CET, promotes regional integration

Combined fiscal effects of EPA and CET will preserve fiscal revenues for Ghana

EPA Details (1/2)

Liberalized imports from the EU are mainly goods which are not produced locally, notably inputs used by local industries.

Elimination of import tariffs can reduce the production costs of local companies and will also benefit Ghanaian consumers.

In order to protect sensitive sectors, ECOWAS has excluded a number of agricultural and non-agricultural products from liberalization : Chicken, tomatoes (prepared/preserved), sugar, cereals, flour, frozen fish, tobacco, cotton fabrics, soap, beer

In addition: bilateral safeguards measures, infant industry clause and food security clause

EPA Details (2/2)

* No short cuts: There cannot be a compromise on safety standards; quality, SPS issues

* No discrimination: The food law applies to all, locally made and imports and must be complied with.

But, One negotiation – 500 Mio consumers; Fully harmonized import conditions for all food and feed, in-

line with international standards; Flexibility: Objectives must be met, not the letter of the law. And assistance:• Export HelpDesk• Development cooperation, Aid for trade and Better Training for

Safer Food (BTSF)

The EU market Market access conditions are not easy,

but …

…there is support to access the EU market: Export

Helpdesk

• EU-Export Helpdesk is a free online service for businesses in developing countries that wish to export to the EU.

• The Helpdesk provides practical product and country specific information on:

Documents needed to access EU marketsImport duties, tariffs, excise duties involvedPreferential arrangements (such as under the EPA) enjoyed by the country of origin (tariffs, quotas) Trade statistics

The EPA is development-oriented :•Aid for Trade with the EPA Development Programme (EPA-DP): The EU & MS had pledged €6.5 Billion to the EPA-DP for 2010-2014, to be continued under the 2015-2020 programming period and beyond. •Aimed at supporting trade related assistance, infrastructure essential to trade development, institutional reforms (e.g. fiscal systems), capacity building of relevant stakeholders to facilitate the transition towards liberalization (examples to follow). •Examples in Ghana: TRAQUE, EBO, EIB

…EPA Development Programme

We know that Governments cannot create sustainable jobs for the growing population West Africa.

Governments can however create the enabling environment for the private sector to operate in.

And that is where EU support to trade and investment and the EPA will play an important role.

Thanks for your kind attention Christian.Peters@eeas.europa.eu

…Conclusions