The CARIFORUM (CARICOM Member States and the Dominican Republic) have completed negotiations for an Economic Partnership Agreement (EPA) with the European Union (EU) in December 2007. (View EPA) Negotiations had commenced in April 2004. The EPA is fundamentally different from the Cotonou Partnership Agreement since it represents reciprocal (two-way) trade between the two regions instead of one-way preferences that was previously granted to CARIFORUM by the EU.
Furthermore, what differentiates this Agreement from other trade agreements is its development dimension. While the agreement contains provisions on market access of goods and services between the two regions, it also contains key provisionson development in which the EU has committed to assisting the CARIFORUM economies in areas of technical assistance and capacity building so that the developing economies can have better access to the European market.
The EU has granted CARIFORUM economies great concessions in market access in both goods and services. However, it must be noted that “market access” does not translate into “market presence.” Members of the private sector in Belize will need to take advantage of the provisions of the agreement so as to use the opportunity to invest and expand in its exports of goods and services.
With respect to trade in goods, the EU has granted CARIFORUM Member States including Belize, duty free and quota free access to the European market. On the contrary, CARIFORUM has agreed to eliminate 82.7% of imports from the EU by2033. (View Schedule for Tariff Liberalization for CARIFORUM Countries).
CARIFORUM has committed to opening 75% of its service sectors to the EU service providers for More Developed Countries (Jamaica, Suriname, Trinidad & Tobago, Barbados and the Dominican Republic) and 75% for Less Developed Countries (LDCs) such as Belize in respect to commercial presence. (View List of Commitments in Investment and Trade in Services).
Belize made commitments in Professional services, Communication services, Construction and Related Engineering services, Distribution services, Environmental services, Financial services, Health related and Social services, Tourism and Travel related services, Recreational, Cultural and Sporting services, and Transport services. Click here to view Belize’s Services Schedule.
While it is exceptional that CARIFORUM negotiators were able to weave development in core chapters in the EPA Agreement, many of the references do not bind the EU by a time-table for implementation. Thus, this leaves a great window of opportunity for the European Council (EC) to decide what to support, when and how much to inject into CARIFORUM economies without any legal recourse available for CARIFORUM countries to refute.
More disturbingly, the EC did not commit any new funds for EPA implementation during the negotiations. Not surprisingly, it has signaled that the priority use of the European Development Fund (EDF) under the rubric of the Cotonou Partnership Agreement will be used for the EPA implementation. A meager sum of €165 million under the 10th EDF which amounted to approximately €2.2 million per country per year is certainly inadequate to address the development needs of countries such as Belize to achieve economies of scale and become competitive.
For other annexes and protocols to the EPA click here.
For further information on EPA Implications for Belize click here.