Towards Equitable Agricultural Development in the EAC:

1. Towards Equitable Agricultural Development in the EAC: An Analysis of the EPA between the EU and the EAC Fostering Equitable Agricultural Development in Africa (FEAD) Project

2. Structure of the Presentation • Agriculture Related Provisions in the Framework EPA • Potential for Equitable Agriculture Development in the Framework EPA • Investment for increased productivity • Reform of international and regional disciplines in agriculture • Redressing agriculture related trade constraints • Capacity building of small and medium sized farmers • Multi-stakeholder consultation and coordination • Concluding Remarks and Way Forward

3. Current Content of the FEPA • Chapter I - General Provisions • Chapter II - Trade Regime for Goods • Chapter III - Fisheries • Chapter IV - Economic and Development Cooperation • Chapter V - Areas of Future Negotiations • Including Special Chapter on Agriculture • Chapter VI - Dispute Avoidance and Settlement, Institutional, General and Final Provisions • Protocol I - Concerning the Definition of the Concept of Originating Products and Methods of Administrative Cooperation • Protocol II - On Mutual Administrative Assistance in Customs Matters

4. Agriculture Related Provisions in the FEPA: Trade in Goods • The FEPA provides for duty free and quota free (DFQF) market access for all EAC exports to EU with special safeguard provisions for sugar until 2015 • The EAC will liberalise 82 percent of EU imports over a period of 25 years

5. Agriculture Related Provisions in the FEPA: Rules of Origin

6. Agriculture Related Provisions in the FEPA: Export Taxes

7. Agriculture Related Provisions in the FEPA: Non-Tariff Measures • Ensuring transparency in accessing the EU market • Increased access for EAC agricultural products in the EU market • BUT • It is also necessary to train and assist SMFs so as to enable them to comply with standards and regulations • The imposition of non-tariff measures is prohibited • Quotas • Export or import licenses • Exceptions • Measures are applied to prevent or relieve critical shortages of food • Restrictions are necessary to the application of standards or regulations in international trade

8. Agriculture Related Provisions in the FEPA: Safeguards • The EPA allows for multilateral and bilateral safeguards, and includes special provisions for infant industries ... ....BUT • burdensome procedures • time limit after which clear elements are required leading to the elimination of the measure • no special safeguards for agriculture • only temporary distortions are addressed whereas distortions in agricultural trade are rather of structural nature

9. Agriculture Related Provisions in the FEPA: Development Cooperation • EAC has drafted a Text on Agriculture (2009) and a Text on Economic and Development Cooperation (2011) • Areas of development cooperation of both texts need to be harmonised • Chapter on development cooperation should allow for the retention of mechanisms favourable to development and exclude mechanisms hindering development • Revenue loss due to binding liberalisation should be caught by binding development support • Until now only objectives • EU confirms to continue its financial contribution to: • 10th European Development Fund • Aid for Trade • No new specific commitments under FEPA • Development cooperation will be further considered in the next phase of negotiations

10. Potential for Equitable Agriculture Development in the Framework EPA

11. Potential for EAD in the FEPA: Increased investment leading to improved productivity DFQF Market Access • Can create incentives for increased investment in the agricultural sector leading to: • Improved productivity • Diversification • Import of capital goods • Spill-over of technology • Main target of investment should be small and medium sized farmers

12. Potential for EAD in the FEPA: Increased investment leading to improved productivity Rules of Origin • simplified rules of origin provide more certainty • Possibility of cumulation provides for value addition and diversification and can increase export activity in agricultural products

13. Potential for EAD in the FEPA: Increased investment leading to improved productivity – The Way Forward • Chapter on Agriculture has to include provisions on • promotion of joint ventures and mixed investments in general • facilitation of access to credit facilities for small and medium sized farmers • Chapter on Development Cooperation has to include • Binding commitments to achieve a better infrastructure and better technological inputs • Binding commitments to compensate revenue loss as a result of liberalisation through development support

14. Potential for EAD in the FEPA: Reforming international and regional disciplines in agriculture • Negotiating the FEPA as a bloc: strengthening regional integration • creation of larger markets • generating small and medium sized farmers’ activity • Improved food security by allowing the movement of goods from surplus to deficit areas within and outside the EAC • Safeguardsaddress the essential issues but fail to be effective due to time limitations and cumbersome procedures • The use of subsidiesshould be confined

15. Potential for EAD in the FEPA: Redress of trade facilitation constraints • Need for a specific development fund under FEPA aimed at: • Improving customs administration, • building better infrastructure networks, • capacity building of small farmers, • harmonisation of the regulatory frameworks within the EAC • etc. • Need for binding commitments aiming at improving the agricultural private sector that go beyond traditional technical assistance and include real transfer of know-how and technology

16. Potential for EAD in the FEPA: Capacity building of SMFs • the EPA fails to explicitly address: • Better access to production technologies, product quality enhancements and direct linkages to the market for SMFs • Better information of SMFs on how to use commercial, technical, scientific and financial opportunities under the EPA

17. Potential for EAD in the FEPA: Multi-stakeholder consultation and coordination As promoted in the Cotonou Agreement, somemulti-stakeholder consultations in EPA negotiations were conducted … … BUT • no mechanism to ensure neither the taking into account of the stakeholders’ views nor the information of stakeholders about final outcomes • parliamentarians, consumer associations, trade unions, small business, informal sector, and farmers are not always members of these fora • multiplicity and sometimes ad-hoc nature of consultative mechanisms hamper regular and effective participation

18. Potential for EAD in the FEPA: Multi-stakeholder consultation and coordination • The East African Business Council (EABC) • smallholder farmers are not well represented thus they lack the ability to own policy implementation let alone policy-making • The informal sector • should also be recognized as a stakeholder and its participation in negotiations should be seized • Including the informal sector as a stakeholder in the EPA negotiations would eventually • transform informal activity to formal activity, • increase government revenues • enhancethe agricultural sector by making technology and finance available for a greater number of beneficiaries.

19. Concluding Remarks: The way forward for national governments • National governments need to… • provide stakeholders with information on how they can effectively harness opportunities provided for under the EPA • establish channels through which all stakeholders can participate in consultations on the ongoing negotiations and be informed about final outcomes • establish mechanisms which ensure that their views, opinions and proposals are taken into account • harmonise regional and national strategies • allocate resources to sectors that are likely to benefit most from the EPA

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