As they undergo changes, what is the outlook for agreements between the European Union and developing countries ? What opportunities are available to developing countries ?
Proposed terms of reference
Negotiations between the European Union and developing countries, which will likely intensify in the coming months, will determine the rules of the game for several years to come. Economic Partnership Agreements (EPAs) that govern trade between the EU and the African-Caribbean-Pacific Countries (ACPs) will enter into effect in 2008. The elaboration of these agreements will take place in the context of the finalisation of the Doha Round and the conditions governing the application of Doha commitments. The broad scope of the mechanisms that will be adopted urges an analysis of the stakes involved. Decisive aspects need to be accurately identified and attention should be paid to ways of watching over and anticipating the consequences of these measures. For this reason, FARM is commencing a working group on this question.
The primary goal is to highlight the key provisions regulating relations between the European Union and developing countries in the area of agricultural production and trade, and to do so for the benefit of professional agricultural organisations and policy makers. A second goal is to propose innovative partnerships and forms of public aid to the agricultural sector.
EPAs between the European Union and the ACP countries constitute the commercial component of the Cotonou Agreement and are slated to enter into effect on the first of January 2008. In conformity with the rules of the World Trade Organisation (WTO), these agreements will establish free-trade zones based on the principle of reciprocity, although the reciprocity will be assymetrical. Developing nations will have the right to exclude certain products from such agreements, and they will be allowed to defer the date on which their commitments take effect. One of the stated goals of the agreements is to promote regional integration.
Doha Round negotiations should be concluded in 2006, according to the Hong Kong final declaration. Commitments concerning domestic support, export subsidies and market access will be phased into effect between now and 2013. Meanwhile the EU is planning to put into effect this year (2006) new rules for the common banana market and common sugar market.
The European initiative Everything But Arms (EBA), signed in February 2001, is being phased into application and will apply to bananas in 2006 and rice and sugar by 2009. The EU has signed free trade agreements with Mediterranean countries, South Africa, Mexico, and Chile.
The EU’s Generalised System of Preferences (GSP), which entered into effect in July 2005, will remain in effect until December 31, 2008.
The European Council on December 15 and 16, 2005 adopted a new European strategy towards Africa in the light of the decision by the EU in May 2005 to fix a target for gross public expenditure on aid (GPEX) of 0.56% of GNP by 2010, and 0.7% in 2015, of which 50% will be earmarked for Africa. In 2003, European GPEX towards Africa – counting both Commission funds and national spending – amounted to 15 billion euros. According to the new targets, this figure should rise to 23 billion by 2010.
The GPEX of OECD countries has been steadily growing since 1998, achieving a growth rate of 4.7% in 2003 and 2004. Total amount of aid in 2004 was 72 billion dollars or 0.25% of GNP. The largest share of this sum went toward social categories that were identified as priority needs in world forums and in particular the Millenium Development Goals.