Economy

Githu digs in for European trade deal battle at the East African Court

Attorney-General Githu Muigai. PHOTO | FILE
Attorney-General Githu Muigai. PHOTO | FILE 

Kenya has said it will vigorously defend its interests in a suit filed at the East African Court of Justice (EACJ), seeking to stop it from concluding a crucial trade agreement with Europe.

Attorney-General Githu Muigai, who is named as the second respondent in the case seeking to block four East African Community (EAC) member-countries from signing the Economic Partnership Agreement (EPA), says Nairobi will prepare a solid defence.

The case is set for hearing in Arusha on Thursday this week.

The AG’s statement signals a likely hardening of positions over the matter, which has pitted Kenya and Rwanda against fellow EAC members Tanzania, Uganda and Burundi.

“We shall seek to persuade the court that Kenya has acted and will continue to act in her sovereign best interest and within the EAC law,” said Prof Muigai in an interview.

A Tanzanian lawyer, Castro Pius Shirima, filed the case at the Arusha-based East African Court of Justice (EACJ) seeking to block Tanzania, Burundi, Uganda and South Sudan from signing the EPA. Kenya and Rwanda signed the contentious trade deal with the European Union (EU) in September.

The EAC – like other African and Caribbean groupings – has been negotiating the EPA with the EU since 2007. The pact guarantees reciprocal duty-and-quota-free access to the EU market.

Kenya exports mainly horticultural products, fish and tea to the EU markets.

The signing of the EPA by Kenya and Rwanda ahead of the September 30 deadline initially issued by the EU parliament helped to cushion exports from tariff charges of between five and 24 per cent on its Europe-bound exports.

The EU market accounts for one third of Kenya’s export, with official estimates putting tariff costs at Sh100 million per week or Sh400 million per month.

Kenya’s Trade and Industrialisation secretary, Adan Mohamed, who teamed up with his Rwandese counterpart, Francois Kanimba, in Brussels to sign the EPA on behalf of the two governments said a lot of ground has been covered since the EAC Heads of State met in September.

“We (EAC trade ministers) have continued to dialogue on this issue of EPA with EU as directed by Heads of State in September. We have been channelling our issues to the EAC secretariat and at the next Summit in January, we’ll get guidance and direction from the Heads of State,” said Mr Mohamed on the sidelines of the inaugural Kenya Manufacturing Summit and Expo held in Nairobi last week.

Unlike Kenya, the rest of EAC members are classified as Least Developed Countries which do not have to reciprocate duty-free trade with the EU and other developed economies.

Under the EPA, the EU has committed to leave its market open for the EAC in exchange for gradual liberalisation of 82.6 per cent of the signatories’ market over a period of 25 years.

In September the EAC Heads of State reached a gentleman’s agreement postponing to January the making of a final decision on the EPA by the remaining signatories in the wake of stiff opposition from Tanzania.

The grace period was meant to give EAC trade ministers ample time to seek further concessions from the EU side.

Prof Muigai is named alongside the attorneys-general of the other five EAC member-states and the EAC Secretary-General as defendants in the suit.

In his application received by the EACJ on October 31, Mr Shirima is seeking orders stopping conclusion of the deal until the perceived risks to the region’s agriculture and industrialisation are addressed by negotiators.

Mr Shirima has also asked the regional court judges to order the EAC Secretary General, Liberat Mfumukeko, to suspend further trade negotiations with the EU until the case is determined.

The petitioner, who teaches law at Iringa University, maintains that his suit has been filed in his individual capacity as an EAC citizen who will suffer “irreparable economic loss and violation of my rights under EAC Treaty” if Kenya lobbies other member-states to conclude the EPA before the economic risks to the region are addressed.

Mr Shirima maintains that he is looking forward to meeting Kenya’s legal defence team in the Arusha court next week, even as Prof Muigai said his team was yet to be served with court papers.

“I leave it to the court to determine whether or not Kenya and all the other respondents were properly served,” Mr Shirima told the Business Daily on the phone.

“To the best of my knowledge, I have properly served all the respondents with the court papers and I have notification to that effect.”

In the six-member bloc, Tanzania has rejected the deal, citing underlying economic risks while Burundi has said it will not endorse it after the EU questioned its human rights record.

Kenya has ratified and deposited the deal with the EU parliament while Rwanda is in the process of ratifying what it signed in September.

Uganda had in late September indicated its willingness to append its signature.

Mr Shirima argues that only the court can halt the EPA as it will automatically become enforceable once it is ratified by three states.