Maputo — SA, Angola and Namibia could soon be left in the cold if they continue resisting signing the Economic Partnership Agreements (EPA) with the European Union (EU) which is increasingly under pressure to streamline its trading policies under the World Trade Organisation (WTO) regulations, according to European Commission's trade directorate.

Addressing an information seminar on the EPA negotiations between the EU and the Southern African Development Community (SADC), Jacques Wunenburger who is head of the commission's trade directorate, said countries that have signed the interim EPA were rightfully concerned that the EU was continuing to grant SA, Angola and Namibia the same privileges in terms of trade access even though they had not signed.

"The situation is untenable because it is unfair to countries that have signed and it is an illegal arrangement not permissible under the WTO," he said.

Wunenburger said it has been a challenge for his unit to negotiate with SADC since only seven of its 15 member countries negotiated an EPA with the EU as the SADC group. Other eight SADC member states (DR Congo, Madagascar, Malawi, Mauritius, Seychelles, Tanzania, Zambia and Zimbabwe) are negotiating in other regional EPA configurations such as the East Africa Community.

SA had initially participated as an observer and in a supportive capacity for Angola, Botswana, Lesotho, Mozambique, Namibia and Swaziland. It formally joined negotiations in 2007. Part of the reason why SA had chosen to be an observer was because it has a separate agreement with the EU called Trade, Development and Cooperation Agreement.

Botswana, Lesotho, Swaziland and Mozambique signed the interim EPA in June 2009. Although Namibia initialled the agreement more than two years ago, they decided not to sign. However, SA did not join the agreement because of a series of disagreements on some of the key provisions of the text.

Angola did not join the agreement either, because it has not yet tabled a tariff offer. In the meantime Angola, being one of the least developed countries in the continent, maintains duty free market access to the EU under the 'Everything-But-Arms initiative' while EU-SA trade is covered by the Trade, Development and Cooperation Agreement. However, the interim EPA contains a clause allowing Angola or SA to join rapidly.

The three countries nevertheless still today benefits from duty and quota free access to the EU that was granted temporarily to all ACP under the so-called Market Access EPA Regulation.

Wunenburger said negotiations for a full EPA including services, investment and trade related rules must continue and also involve Namibia, Angola and SA who "opted out" from this commitment on services. SA was particularly reluctant to relent on this point because it would allow the EU business to come to the region to challenge its dominance. He said he was hopeful that they could revise their position and that the matter could be concluded.

Ivano Casella also from the Commission's trade directorate said the interim EPA was a vast improvement in that it has harmonised an estimated 3000 various tariff barriers to many developing countries in Africa, Caribbean and Pacific to a mere 53 tariff lines. It was even better the US's Africa Growth Opportunity Act saying it focused on helping a few countries while the EU's agreement targeted all developing states and was giving market access to many products.

Casella denied that the EU was dividing the Southern African Customs Union (SACU) saying the agreement will strengthen it because it will broaden the region and ensure that trade has a bigger market by including more SADC countries. He said the move will facilitate economic growth for SADC as a hole.