Economic Partnership Economic Partnership Agreement (EPA) and the Agreement (EPA) and the

Pacific Pacific

Trinnex, ProinvestTrinnex, Proinvest

Vanuatu, August 2010Vanuatu, August 2010

ContextContext

Trade between the EU and Pacific states is Trade between the EU and Pacific states is limited and erratic (about 0.06% of EU’s limited and erratic (about 0.06% of EU’s trade)trade)

Most important export products to the EU Most important export products to the EU are palm oil, copper, sugar, coconut (copra) are palm oil, copper, sugar, coconut (copra) and fishand fish

Cotonou agreement expired on 31 Cotonou agreement expired on 31 December 2007December 2007

EPA in the Pacific EPA in the Pacific State of playState of play

Late 2007, the two biggest economies with Late 2007, the two biggest economies with significant trade flows with the EU – Fiji and significant trade flows with the EU – Fiji and PNG – agreed an interim EPA with the EU.PNG – agreed an interim EPA with the EU.

the agreement maintains and improves the agreement maintains and improves PNG's and Fiji's preferences in the EU PNG's and Fiji's preferences in the EU market for their main exports and ensures market for their main exports and ensures that they benefit from improved Rules of that they benefit from improved Rules of Origin for key products like canned tunaOrigin for key products like canned tunandnd

EPA in the Pacific EPA in the Pacific State of playState of play

The agreement was signed by the Parties in the The agreement was signed by the Parties in the latter half of 2009. Provisional application of the latter half of 2009. Provisional application of the agreement for PNG started on 20 December agreement for PNG started on 20 December 2009. Application for Fiji is pending a notification 2009. Application for Fiji is pending a notification of provisional application or ratification.of provisional application or ratification.

The Least Developed Countries (LDCs) of Kiribati, The Least Developed Countries (LDCs) of Kiribati, Samoa, Solomon Islands, Tuvalu and Vanuatu all Samoa, Solomon Islands, Tuvalu and Vanuatu all benefit from the Everything But Arms (EBA): duty benefit from the Everything But Arms (EBA): duty free and quota free access to the EU.free and quota free access to the EU.

Interim EPA Interim EPA State of playState of play

The non-LDCs that did not join the interim EPA The non-LDCs that did not join the interim EPA (Cook Islands, Tonga, Marshall Islands, (Cook Islands, Tonga, Marshall Islands, Micronesia, Niue, Palau and Nauru) benefit from Micronesia, Niue, Palau and Nauru) benefit from the EU's regular Generalised System of the EU's regular Generalised System of Preferences since 1 January 2008.Preferences since 1 January 2008.

The interim Economic Partnership The interim Economic Partnership

AgreementAgreement

Concluded with PNG in July 2009, Concluded with PNG in July 2009,

Fiji in December 2009,Fiji in December 2009,

Major provisions of trade in goods agreement.Major provisions of trade in goods agreement.

The interim Economic Partnership The interim Economic Partnership

AgreementAgreement Duty free quota free access for all PNG and Fiji Duty free quota free access for all PNG and Fiji

exports to the EU (transition for rice and sugar)exports to the EU (transition for rice and sugar)Asymetric and gradual tarriff reduction scheduleAsymetric and gradual tarriff reduction scheduleTrade defence (safeguards)Trade defence (safeguards)TBT and SPSTBT and SPSTrade facilitationTrade facilitationClause on ongoing full regional EPAClause on ongoing full regional EPA

Liberalisation commitmentsLiberalisation commitments

PNGPNG to liberalise 88% of EU imports and to liberalise 88% of EU imports and excluded products from the most sensitive excluded products from the most sensitive economic sectors (e.g. meat, fish, vegetables, economic sectors (e.g. meat, fish, vegetables, furniture) and luxury products (jewellery)furniture) and luxury products (jewellery)

FijiFiji will liberalise 87% of EU imports over 15 will liberalise 87% of EU imports over 15 years. Fiji excluded products from the most years. Fiji excluded products from the most sensitive economic sectors such as meat, fish, sensitive economic sectors such as meat, fish, fruits and vegetables, alcohol, tubes and iron.fruits and vegetables, alcohol, tubes and iron.

OTHERSOTHERS

RoO RoO Global sourcing for canned tuna Global sourcing for canned tuna

Also IUU regulation (illegal, unreported and Also IUU regulation (illegal, unreported and unregulated fish)unregulated fish)

To fully benefit from iEPA To fully benefit from iEPA investments in investments in facilities and quality control, secure source of facilities and quality control, secure source of raw materialraw material

EPA in the Pacific EPA in the Pacific Way aheadWay ahead

Ongoing negotiations on comprehensive full Ongoing negotiations on comprehensive full regional EPA with Pacific Statesregional EPA with Pacific States

Continued EU support in the TRA areaContinued EU support in the TRA area

EU regional suport in the TRA area

Strengthening Pacific Economic Integration Strengthening Pacific Economic Integration Through Trade (SPEITT)Through Trade (SPEITT)

PIFS’ Pacific Regional Economic Integration Program (PACREIP),the SPC’s Facilitating Agricultural Commodity Trade (FACT) program,the South Pacific Tourism Organisation’s (SPTO) Pacific Regional Tourism Development Program (PRTDP) programStrengthening Fisheries Products (SFP)Strengthening Fisheries Products (SFP)PROINVEST / BIZCLIMPROINVEST / BIZCLIM

Strengthening Pacific Economic Strengthening Pacific Economic Integration Through Trade Integration Through Trade

(SPEITT)(SPEITT)

30 mi EURO30 mi EURO

3 main objectives:3 main objectives:– Increased capacity in trade policy Increased capacity in trade policy – Improved trade facilitation through improved customs Improved trade facilitation through improved customs

management and systemsmanagement and systems– Strengthened PACPs productive export capacity Strengthened PACPs productive export capacity

Continued EU support in the TRA areaContinued EU support in the TRA area

Strengthening Pacific Economic Strengthening Pacific Economic Integration Through Trade Integration Through Trade

(SPEITT)(SPEITT)

4 sub-components:4 sub-components:– the Pacific Integration Technical Assistance Program (PITAP), the Pacific Integration Technical Assistance Program (PITAP),

implemented by PIFS; implemented by PIFS; – the Pacific Regional Tourism Capacity Building Program the Pacific Regional Tourism Capacity Building Program

(PRTCBP) implemented by SPTO; (PRTCBP) implemented by SPTO; – the Increasing Agriculture Commodity Trade (IACT) programme the Increasing Agriculture Commodity Trade (IACT) programme

implemented by SPC; implemented by SPC; – the Trade Facilitation through Customs Cooperation (TFCC) the Trade Facilitation through Customs Cooperation (TFCC)

program implemented by OCO program implemented by OCO

Continued EU support in the TRA areaContinued EU support in the TRA area

Strengthening Pacific Economic Strengthening Pacific Economic Integration Through Trade Integration Through Trade

(SPEITT)(SPEITT)

Implementation to start next yearImplementation to start next year

Questions?Questions?

Thank you !Thank you !

Continued EU support in the TRA areaContinued EU support in the TRA area

EU – PNG Trade dataEU – PNG Trade data

-800

-600

-400

-200

0

200

400

600

800

2005 2006 2007 2008 2009

Imports Exports Balance

About 7-8 % of PNG’s trade and less About 7-8 % of PNG’s trade and less than 0.03 % of EU’s tradethan 0.03 % of EU’s trade

EU imports from PNG 2009

11%

54%

13%

7%

9%6%

Vegetable products

Fats and Oils

Prepared foodstuffs

Mineral products

Precious stones

Other

EU exports to PNG 2009

3% 9%

11%

65%

3%

4%

5%

Prepared foodstuffs

Chemicals

Base metals

Machinery

Vehicles

Optical

Other