EAC, EU agree to settle unresolved trade issues

Cabinet Secretary for Foreign Affairs Amb. Amina Mohamed (left) flanked by Principal Secretary Karanja Kibicho during a press conference in Nairobi. PHOTO DAVID NJAAGA

Nairobi; Kenya: East African Community (EAC) states and the European Union (EU) have reached a new deal in protracted negotiations of Economic Partnership Agreements (EPAs).

The breakthrough draft text for the EPAs paves the way for a final agreement. A ministerial negotiation in Brussels, Belgium, early this year ended without an agreed text.

However, an agreement has now been reached by the East African Council of Ministers in Arusha after a day-long meeting chaired by Kenya's East African Affairs, Commerce and Tourism Cabinet Secretary Phyllis Kandie.

EPAs are free trade agreements the European Union is negotiating with countries in Africa, the Caribbean and the Pacific.

Ms Kandie, who chairs the Council of Ministers, described the breakthrough as good news and a clear indicator that regional integration has taken root.

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"The agreement was particularly significant for Kenya who stood to lose billions in exports to the EU if a deal was not finalised by October 1, 2014," she added in a statement released in Nairobi yesterday.

Foreign Affairs and International Trade Cabinet Secretary Amina Mohamed told a media briefing that Kenya had a very capable team during the negotiations, consisting of Cabinet and principal secretaries and experts from the ministry among others.

She added that chances of beating the October deadline were high but assured that in case there was a delay of two to three months resulting in taxes, the Government would make refunds.

"At last we were able to agree. We will still be holding meetings on September 24 and 29 and hopefully by October, we will have it ratified and moved to the next phase," she said.

The EPAs negotiations have been a long drawn out exercise, dating back to 2004, and have seen ministers for Trade across the region shuttle between Arusha and Brussels for protracted negotiations.

The last major negotiations in Brussels took place in March when negotiators expected to seal the deal, but talks stalled over outstanding issues such as rules of origin and most favoured nation status.

It is hoped the current consensus in EAC is an indicator that a final agreement with the EU will be ironed out and the deal signed by October 1. Among outstanding issues Kenya is yet to agree with the EU are duty and taxes on exports.

The EU accounts for 85 per cent of Kenya's fresh produce market. East Africa exports approximately $4.8 billion worth of products to the EU market including oil products, medicines, machinery and mechanical equipment.