East Africa, EU trade talks suffer fresh setback

East Africa’s long running negotiations with Europe over the signing of a new trading agreement appeared headed for the rocks after the parties returned to Dar es Salaam with the old arguments that have stalled the talks for nearly two years.

Hopes that the talks that opened in Tanzania on Monday might break the stalemate withered yesterday with the EU expressing fears that the regional assembly’s position on the interim Economic Partnership Agreement (EPAs) may have muddied the waters.

Eric van der Linden, the head of the EU delegation in Kenya, remained cautious over the possibility of landing a new deal citing “negative opinion” from the political class.

“My short answer is no. I note the negative opinion from the East African Legislative Assembly (EALA). While this opinion is perhaps not legally binding, it will no doubt influence politicians,” he said on Tuesday when asked about the prospects of signing an agreement.

Last week, EALA urged EAC member states not to sign the EPAs until all outstanding issues are resolved.

Top on the list of sticking points is investment and government procurement as well as the terms of trade that the EU is offering but East Africans see as tilted in favour of Europe.

Enthusiasm was equally lacking from East Africa’s key negotiators.

East Africa is currently trading with Europe on preferential terms but without legal backing after the World Trade Organisation rejected the non-reciprocal trade terms that Europe had offered its former colonies in Africa and the Caribbean since the early 1960s.

The EPA framework that is being negotiated is meant to offer a new road map on how Europe should engage East Africa on matters of trade, and economic development without breaching the WTO rules.

It is expected to last another six months pending the signing of a comprehensive EPA by end of year.

Signing of the interim agreement should end two years of brinkmanship that have seen EC officials dangle the stick of EAC losing the concessionary trading terms altogether in the event of failure to meet the set negotiation deadlines.

“The situation, as it stands now, is not sustainable,” said Timothy Clarke, the Head of the European Union Delegation in Tanzania in February. “In fact, the current situation is contrary to both EU law and World Trade Organisation rules.”

EU is East Africa’s single largest market but Kenya is seen as the biggest possible loser should the talks collapse because it lacks alternative means to trade with Europe upon closure of the preferential window.

Because of its standing as a non-member of the Highly Indebted Poor Country (HIPC), collapse of the talks will force Kenya to trade with the EU on the less generous General System of Preferences (GSP) platform.