Caribbean Signs Economic Partnership Agreement With EU

CARIBBEAN SIGNS ECONOMIC PARTNERSHIP AGREEMENT WITH EU
ARTICLE BY ROSALIENE BACCHUS

On December 16, 2007 Guyana and other fourteen CARIFORUM countries (see Footnote 1) were the first of six
sub-groups of the African, Caribbean and Pacific (ACP) states to sign a full Economic Partnership Agreement
(EPA) with the European Commission (EC). In so doing, the Caribbean region met the 2007 year-end deadline
for WTO compliance and secured uninterrupted trade in its goods with the European Union (EU) from January
1, 2008. The CARIFORUM countries have until April 15, 2008 to effect the terms of the Agreement.

Under this Agreement, Caribbean products—with the exception of arms and ammunition—will have duty-free
access to EU markets. Rice exporters will enjoy duty-free and quota-free entry from January 1, 2010. During
the transition period, the EC will gradually apply duty-free quotas for up to 250,000 metric tons (275,577 tons).
The “Sugar Protocol” of the Cotonou Agreement (see Footnote 2) will remain in effect until September 30, 2009
after which the EC will eliminate its customs duties. The EC will grant a duty-free quota for an additional
60,000 metric tons (66,139 tons) for marketing year 2008/2009.

In recognition of the importance of banana exports to some CARIFORUM countries, the EC will maintain its
tariff preference as long as possible and will provide funding to increase the industry’s production and
competitiveness. Moreover, by December 31, 2010 Guyana and Surinam will eliminate customs duties on a
number of primary products exported to the EU. European-funded technical assistance for tax reforms will
offset the resulting shortfall in trade tax revenue.

With the exception of agricultural and processed agricultural products, some chemicals, furniture and other
industrial products, EU exports to the CARIFORUM countries will be subject to a gradual reduction to zero on
import duties over a 10 to 25-year “Liberalization phasing-in” schedule. Provisions are included for
transforming the agricultural, food and fisheries sectors of CARIFORUM countries through development of
quality products, increase in competitiveness and accessibility to high quality markets.

The Agreement on services liberalization is the first of its kind for the Caribbean region. The Title on
“Investment, Trade in Services and E-commerce” is very comprehensive: covering market access, behavior of
investors, movement of service providers, regulatory framework for each type of service, electronic commerce,
and technical cooperation and assistance. In a region where tourism is vital to many economies, the EPA
makes provision for preventing anti-competitive practices of distribution network providers, facilitating the
participation of small and medium-sized enterprises, and developing tourism through diverse financing
programs.

A major victory for CARIFORUM leaders is the incorporation of the “Protocol on Cultural Cooperation.” The
Protocol establishes a framework for cooperation and technical assistance in cultural and entertainment
services, and allows better access to EU markets for Caribbean artists, musicians, and other cultural
professionals.

Considering that the EU is the Caribbean’s second largest trade partner with 18 percent of its total trade in
2006 (see Footnote 3), this EPA will have an impact on the region’s trade and economic relations. Only time will
tell if it will generate economic and social progress for its people.

Footnotes:

CARIFORUM: Caribbean Forum for the Caribbean Group of States, sub-group of the ACP Group of States. It includes the
independent states of the Caribbean Community (CARICOM) and the Dominican Republic.
Cotonou Agreement: Treaty between the EU and ACP states signed in June 2000 in Cotonou, Benin. Established for a period
of 20 years, it aims to eradicate poveryt, contribute towards sustainable development, and gradually integrate the ACP
countries into the world economy.
Source: EUROSTAT Trade Statistics, August 2007.

Article published in the Guyana Journal, Guyana Journal Publication, Inc., New York, USA, January 2008, p. 9.
Reprinted with permission.

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