EAC seeks clarity on EU trade deal

East African Community (EAC) partner states that are yet to sign the EU-EAC economic partnership agreement (EPA) are not in position to do so pending clarification of issues they have identified in the draft agreement, the regional bloc has said. This was noted in a statement issued after yesterday’s 18th ordinary summit of the EAC Heads of State, held under the theme: “Towards sustainable growth and development of the Community” in Dar es Salaam, Tanzania. “It was however agreed that due to this action Kenya should not be disadvantaged since she has already signed the agreement,” the communiqué reads in part. In September last year, trade ministers of Rwanda and Kenya signed the deal at the EU headquarters in Brussels, Belgium. Last year, the East African Business Council (EABC) advised the partner states to sign the deal quickly since failure to meet the EU deadline for ratification (which has since passed) could see EAC exports to EU attract import duty, especially for Kenya, the region’s largest economy. Whereas Burundi, Rwanda, Uganda and Tanzania have an option to rely on the Everything But Arms (EBA) trade arrangement under which they can still enjoy duty-free market access to the EU, Kenya does not have the same privilege as its economy is considered to be more advanced than the others. Kenya sells some 30 per cent of its exports to the EU. At the summit, President Yoweri Museveni of Uganda assumed the bloc’s leadership that’s held on rotational basis and was mandated to reach out to the European Union to communicate the EAC circumstances within one month. “In the event that an acceptable way forward is not reached with the EU within the next six months, the Chairperson was authorised to explore the use of variable geometry in implementation of the EPA by EAC member states working with the Council of Ministers.” Museveni takes over from President John Magufuli of Tanzania. The Council of Ministers is composed of the ministers in charge of East African Affairs from the member states. The summit also agreed that the EU sanctions on Burundi should be discussed alongside the EPA discussions. The proposed EPA between EAC partner states and the EU was among the key items on the summit’s agenda. Earlier this year, the 35th Ordinary Meeting of the Council of Ministers had mostly considered partner states’ concerns about the deal. The last council meeting was informed that Uganda’s interest was for the partner states to move to sign the agreement as a bloc and to explore available options in the event that some partner states sign the EPA and others do not. The council’s report, a copy of which The New Times has seen, says that while Burundi’s only concern is that the EU unilaterally suspended direct partnership with Bujumbura, Tanzania maintains reservations and needs the EAC Secretariat to conduct a detailed analysis on the effects of the proposed deal in order to bring about regional perspective to the Community. Tanzania highlighted 15 specific concerns including effects of EPA on EAC industrial development, effects of EU subsidies and domestic support on EAC farmers accessing EU market, bridging the gap of revenue losses resulting from substantial trade liberalisation, as well as the effect of Brexit as UK is one of the major trading partners of EAC. New EAC member South Sudan will also take time to study the issues related to the EAC-EU EPA negotiations, it was announced. Confederation model adopted The search for a sustainable financing mechanism was also deliberated by the EAC leaders during yesterday’s meeting with the Heads of State noting the progress on the issue of sustainable financing mechanism for the Community. They directed the ministers of finance to meet and finalise work on the modalities required to establish a sustainable financing mechanism and report to the 19th Summit. Among others, the Summit “noted with concern” the declining intra-EAC trade and directed the Council to resolve the long-outstanding non-tariff barriers and report to the 19th Summit. The leaders also deliberated on the envisioned EAC political federation. The communiqué says they adopted the political confederation as a transitional model of the east African political federation and directed the Council to constitute a team of constitutional experts to draft the constitution for the political confederation and report to the next Summit. The Summit appointed South Sudan’s Justice Dr Charles Oyo Nyawello as a judge in the first instance division of the East African Court of Justice. EAC institutional review The Summit received the progress report on the EAC institutional review and noted that phase one of the institutional review was being implemented and directed the Council to expedite its full implementation. The leaders also received a report on the verification for the admission of Somalia into the EAC. “The Summit directed the Council to follow-up on the matter and report to the 19th Summit.” They also received a progress report on the modalities for promotion of motor vehicle assembly in the bloc aimed at reducing the importation of used motor vehicles from outside the Community; as well as a progress report on the review of the textile and leather sector with view to developing a strong and competitive domestic sector that gives consumers better choice than imported used textile and footwear. They directed the Council to finalise both matters. As expected, the Summit assented to the EAC Customs Management (Amendment) Bill 2016, the EAC Supplementary Appropriation Bill 2016, and the EAC Appropriation Bill 2016. Common Higher Education Area approved The Summit also declared the EAC as a common higher education area in order to harmonise and enhance the quality of education in the region. The Heads of State directed the Council of Ministers to operationalise the transformation. The creation of a common EAC Higher Education Area (EACHEA) implies that qualifications will be appropriately recognised in all partner states both for continuation of studies as well as in the labour market. With the approval of EACHEA, the education system in the Community will be harmonised, comparable, and compatible, thus boosting knowledge and skills development. Apart from the host and Chairperson of the Summit, President Dr. John Pombe Joseph Magufuli of Tanzania, The 18th EAC Summit was attended by President Yoweri Museveni, President Magufuli, Kenya’s Deputy President William Ruto, Burundi’s First Vice President, Gaston Sindimwo, Rwanda’s Minister for Trade, Industry and EAC affairs, and South Sudan President Salva Kiir Mayardit’s economic advisor Aggrey Tisa Sabuni. editorial@newtimes.co.rw

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EAC seeks clarity on EU trade deal