Kenya declines to sign trade pact with EU

Adamant: The State wants  all contentious issues resolved and the new conditions set by EU withdrawn

By Luke Anami

Kenya is not ready to sign trade agreements known as Economic Partnership Agreements (EPAs) with Europe, until all the contentious issues are resolved, Eng Abdularazaq Ali, PS Ministry of Trade has said.

Kenya, which is negotiating EPAs with the European Union (EU) under the East African Community (EAC-EU-EPA), cited the introduction of new conditions and unresolved contentious issues as some of the factors that make it difficult to sign EPAs.

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“EU has introduced new issues in the middle of the negotiations which were not mutually agreed by both parties in the comprehensive EPAs,” Abdularazaq said when he officially opened the East African Legislative Assembly and Civil society workshop on EPAs yesterday at a Nairobi hotel.

“These issues are cooperation in taxation, trade, environment and sustainable development and EU obligations (agreements) with other third parties.” On contentious issues, the Ministry of Trade PS said EAC cannot impose temporary new taxes with regard to revenue, food, security or environmental protection.  EU wants to have consultations before this can be done.

However, EAC and Kenya want to be able to do this temporarily and notify the Council. Under the Most Favoured Nations  clause, the EU wants better preferential trade arrangements offered to other ‘major trading economies such as China, India and Brazil. Any trade agreement EAC signs with China or India, EU should also share with it yet the EU has signed separate agreements with other countries. This could have a chilling effect on South-South trade agreements.

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Levying of  new taxes

Further Kenya or EAC cannot levy new taxes or increases in existing taxes. These are prohibited. “The EU is insisting that these be included in the current negotiations, while EAC has resisted the introduction of the new issues in the middle of negotiations as they will delay the conclusion of EPA,” Abdularazaq said.

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A section of East African Legislative Assembly (Eala) MPs called for the strengthening of the EAC Customs Union and the Common Market Protocol before the signing of  EPAs. “Let  the EAC continue with the integration, only then can we negotiate as a bloc with Europe because if we sign before ironing  out all the contentious issues, there will always be a hidden issue that may affect us,” said Joseph Kiangoi, Eala MP.

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