Isabelle Ramdoo Deputy Programme Manager Trade and Economic Governance, ECDPM 25 – 26 July 2013, Libreville Gabon

1. Implications for Africa
Isabelle Ramdoo
Deputy Programme Manager
Trade and Economic Governance
ECDPM
25 – 26 July 2013
Libreville Gabon
EU Trade Policy with third
countries

2. 1. EU Trade Policy
• With whom and where?
• For What?
2. New geopolitics of EU Trade Policy
3. Implications of EU trade policy with third countries
on EU-Africa relations
• Agreements signed
• Current negotiations
4. What then for Africa?
Structure of Presentation
Page 2ECDPM

3. State of play: EU in a changing world
1.1 Changing geopolitics and centres of gravity moving East
a. Share of GDP is declining and projected to be dwarfed by
emerging countries
b. Share of global trade is still important, but is also projected to
decline
c. Exacerbated by the 2008-09 financial and economic crisis
Trade patterns moved from a country specialisation (primary
commodities for the South and manufactures for the North) to
intra-firm/network specialisation in tasks, giving the South
considerable advantage in the production of manufactures
1 Overview: Where EU is going and why?
Page 3ECDPM

4. • Participation of developing countries in global services
trade rose from 19 to 24% during the same period.
• The rise of the emerging economies: Brazil, Russia, India,
China, and South Africa– now economic and political actors
(members of G20). Together, they account for more than
40% of the world population (market) and approximately
17% of the value of world GDP (purchasing power).
• THEREFORE: URGENT need of growth to preserve its
industries and growth. For this change in logic and change in
focus. Trade is core component of Europe 2020 strategy.
ECDPM Page 4

5. Today EU and US dominate the world Tomorrow China and the emerging countries will dominate
a. Share of EU GDP is declining and projected to be dwarfed by
emerging economies
ECDPM Page 5

6. Share of World Trade in 2010 Share of World Trade in 2030
b. Still a major trading block BUT share is also declining
ECDPM Page 6

7. • After imposing a moratorium on negotiating new PTAs from
1999-2006, the EU in 2007 began negotiating a new generation
of more ambitious or comprehensive FTAs.
• 2006 Global Europe strategy: the EU targeted a number of
larger countries and regions for negotiations, including South
Korea, India, Canada, and the Association of South East Asian
Nations (ASEAN).
• 2010 Trade, Growth and World Affairs: Renewed policy to
strengthen EU’s institutional setting to make EU’s trade voice
louder and clearer. Purpose: complete trade deals on the table
and engage in ambitious negotiations with strategic partners
1.1 Change of logic and change of focus.
ECDPM Page 7

8. EU will:
1. Pursue and conclude current negotiations;
2. Deepen strategic partnerships;
3. Take trade policy forward, including by supporting its SMEs in
going global
Its trade agreements are expected to be:
1. Big enough to have an impact on EU economies;
2. Have to be big enough NOW because need for growth is urgent
(hence the rush to sign PTAs with main partners)
3. PTAs must be BOLD to trigger changes in Europe (to trigger
regulatory reforms in key sectors)
Key objectives of 2010 renewed strategy:
ECDPM Page 8

9. Some Facts:
EU current FTAs – Where?
ECDPMPage 9

10. But EU’s Major markets NOT covered yet!
ECDPM Page 10

11. Neither are EU Major investment partners!!
ECDPM Page 11

12. Status of EU FTAs and their share of EU trade (%),
2009: What is really covered?
ECDPM Page 12

13. EU Trade with main trading partners, 2009
ECDPM Page 13

14. Strategy differ if
EU is next
exporter OR not
importer
Fuel and
minerals: net
importer: that’s
why they push for
fair access
Manuf and
services net
exporter: that’s
why they push for
aggressive MA
(extensive trade
liberalisation)
Now: Clear market access outreach strategy
ECDPM Page 14

15. EU’s trade policy is grouped into four categories :
1. FTAs with strategic partners:
Countries where EU’s objective is to neutralise potential
discrimination against EU exports and investments:
• Signed so far: South Korea (2011), Chile, South Africa.
• Completed with Singapore in Dec 2012
• Nego started with Trans-Atlantic Agreement with US (June
2013), Canada (2009), Japan (March 2013); Thailand (May
2013)
• No discussions yet with China and Russia.
2. Agreements with geographically close neighbours for which
the EU is prepared to offer accession or some slightly looser
relationship. These include EFTA, Turkey, Central and Western
European countries and West Balkans (Association Agreements for
potential future EU countries)
2. The new geopolitics of EU Trade Policy
ECDPM Page 15

16. 3. Agreements designed primarily to foster stability around the EU
borders – Mediterranean countries, Gulf States, Ukraine
4. Agreements with a historical and development focus – this is
the case of EPAs
In addition, EU provides autonomous preferences to developing
countries and LDCs under its Generalised System of
Preferences (GSP) and Everything but Arms (EBA). The
current GSP covers 176 countries.
GSP: number of countries have been reduced to about 80. All high
income and upper middle income countries (eg. China, Brazil,
Malaysia, Gulf states) removed. New GSP will start in 2014.
ECDPM Page 16

17. Economic Partnership Agreements:
Today, 36 ACP countries have some sort of EPA. They are:
16 Caribbean countries (Haiti did not sign);
2 Pacific countries (Fiji and Papua New Guinea)
2 West African countries (Ivory Coast and Ghana)
1 Central African country (Cameroun)
5 Eastern and Southern African countries (Mauritius, Seychelles,
Madagascar, Zambia, Zimbabwe)
5 SADC countries (Mozambique, Botswana, Lesotho, Swaziland,
Namibia)
5 East African countries (Kenya, Burundi, Rwanda, Uganda,
Tanzania)
All of them have duty free and quota free market access to EU.
But MAR1528 Deadline on 1st October 2014. Only countries
that sign, ratify and start implementing their EPAs will continue to
benefit from EPA Market Access conditions.
ECDPM Page 17

18. • To date, EU has signed the following agreements:
• A customs union with Turkey
• A European Free Trade Agreement (EFTA) with neighbouring European
countries, which are not part of the EU (Switzerland, Liechtenstein, Iceland,
Norway).
• Stabilisation and Association Agreements with former Eastern European
countries (Macedonia, Croatia, Albania, Montenegro, Bosnia, Serbia)
• Association agreements with Mediterranean countries (Algeria, Egypt,
Israel, Jordan, Lebanon, Morocco, Palestine, Syria, Tunisia) in 2000. Agadir
Agreement among Tunisia, Morocco, Egypt and Jordan (FTA). Launched
DCTFA Negotiations started in April 2013 with Morocco.
• Free Trade Agreements with Mexico (1999), Chile (2002), S Korea (2012),
Singapore (2012 0 signed but not yet applied)
• EPAs with ESA, Cariforum, PNG (2008)
• Trade and Development Cooperation Agreement, South Africa (1999)
• Preferential agreements with Peru – Columbia (2012); Central America
with Panama, Guatemala, Costa Rica, El Salvador, Honduras, Nicaragua
(2012) ; These 2 agreements are not yet into force
Overview of Bilateral FTAs – Agreements signed
ECDPM Page 18

19. • US: Negotiations for a Transatlantic Trade and Investment Partnership
(TTIP) started in July 2013
• India – a high potential economy, with rising middle class (markets) and
rising GDP (purchasing power). Negotiations are quite slow.
• ASEAN (Indonesia, Malaysia, Philippines, Singapore, Philippines,
Thailand, Vietnam, Cambodia, Laos, Myanmar): Third largest trading
partner of EU. Negotiations for FTA have started with Malaysia in 2010,
with Thailand in 2012 and with Vietnam in 2012.
• Gulf Cooperation Council (Bahrain, Kuwait, Oman, Qatar, Saudi Arabia,
UAE). Negotiations were re-launched in 2002
• MERCOSUR - Argentina, Brazil, Paraguay and Uruguay – first EU’s market
for agriculture (19.8% of total EU imports). Negotiations difficult (8
rounds)
• Canada: Started in May 2009, Quite advanced, but yet to be concluded.
• Japan: Negotiations launched in April 2013
FTAs under negotiations – strategic partnerships
ECDPM Page 19

20. 3. Overview of EU FTA’s with key partners
How will Africa be affected?
ECDPM Page 20

21. Africa/ACP countries are covered by multiple (5) regimes:
1. LDCs are covered by EBA: DFQF with stricter RoO compared to countries
with FTA (except for some textile products where they have ST)
2. GSP – with trade preferences for a no. of products; with stricter RoO
3. EPA – only 4 countries (ESA) currently applying the EPAs; some others
have signed but not ratified; others have initialed but not signed;
4. South Africa – TDCA
5. North Africa: Euromed Agreement; some have started to negotiate
DCFTA
Given different rules in these agreements, cummulation of RoO is made
difficult and countries face competing MA towards EU (varying degree of
openness for their products;
Not conducive to intra-regional trade because cannot be used as a lever to
build regional markets.
Implications for Africa/ACP
ECDPM Page 21

22. 1. Erosion of preferences:
Europe has tariff peaks on a number of products of interest to Africa. This
is expected to be eliminated, causing African business to have to compete
more to access EU
1. Beyond tariffs, erosion of preferences due to partners’ improved RoO;
non-tariff measures are also tackled (eg. Standards);
2. Trade diversion: better market access condition, with relatively easier
procedures is expected to divert trade away from Africa;
3. Services and investments: The new generation of agreements is not
only about trade. But massively about inter-related investments and
services given the high degree of inter-dependence among those
economies. Expected to deepen further investment in these sectors if
access to markets are improved
Impact of EU’s trade agreements on Africa
ECDPM Page 22

23. Erosion of preferences: Main exports from African regions to EU
ECDPM Page 23

24. ECDPM Page 24
But also beef, tobacco, furniture
EPA Market Access: duty free and quota free
EBA Market Access: duty free and quota free
GSP Market Access (see table below)

25. 1. EU Med Agreements
Coverage: Algeria, Egypt, Israel, Jordan, Lebanon, Morocco,
Tunisia, Palestine, Turkey, Syria (not signed)
• Cover essentially trade in goods, being complemented with a
number of additional negotiations to open up additional
agricultural trade;
• Duty-free access to the EU for Med industrial products and
around 80% of agricultural produce
• Common rules to allow cumulation of origin within the Euromed
and beyond.
• Regional convention on PanEuroMed preferential rules of origin
agreed in 2011
• However: proper implementation of the requires complete
South-South FTA network
ECDPMPage 25

26. 1. Textile and clothing (shirts, tshirts, pulls, trousers, yarn)
• Tunisia, Morocco and Egypt are important producers of T&C: DFQF
• RoO: single transformation for fabric; double transformation
for Apparel
• Cummulation: Jordan, Morocco, Egypt and Tunisia have an FTA:
allows them bilateral, diagonal and full cumulation
2. Fisheries:
• Tunisia and Morocco produce preserved, fresh and chilled fish
products, DFQF, except for Egypt on Tuna (duty 20.5%)
3. Other important products include nuts (almonds, cashew) and
citrus fruits (oranges, lime, grapefruits etc). All enjoy DFQF
Key products of interest to Africa
ECDPM Page 26

27. Key products which will where margins of preferences will be eroded
Preference erosion
ECDPM Page 27
Oranges Mandarines grapefruits Lemon Lime
Grapes,
seedless
grapes,
others
MFN 3.20% 16% 2.40% €82.40/100 kg 12.80% €50/100 kg 17.50%
GSP 0% 12.50% 0% n/a 8.90% n/a 14.10%
FTA 0% 0% 0% 0% 0% 0% 0%
Cashew nuts, in shell and
shelled Almonds, bitter Almonds others
MFN 0% 0% 5.60%
Non pref TRQ n/a n/a 2.00%
GSP 0% 0% 2.10%
FTA 0% 0% 0%
Tshirt cotton Shirts Cotton T Shirts man-made Trousers Denim fabric Cotton Fabric
Pullover
cotton
Pullover
wool yarn
MFN 12% 12% 12% 12% 8% 8% 12% 12% 3.8%
GSP 9.6% 9.6% 9.6% 9.6% 6.4% 6.4% 9.6% 9.6% 3.8%
FTA 0% 0% 0% 0% 0% 0% 0% 0% 0%
Fish fillets Tuna, skip jack Fish prepared, preserved
MFN 18% 24% 24%
GSP 14.5% 20.5% 20.5%
FTA 0% 0% 0%

28. 4 Agreements:
1. EU - Mexico (1st generation – not full FTA) – entered into
force in 2000
2. EU – Chile (1st generation – not full FTA), entered into force
in 2003
3. EU – Central American countries (2nd generation, more
comprehensive). Signed in 2012, expected to enter in force in
2nd half of 2013 (69% lib immediately; 96% in 10 years;
100% in 15 yrs)
4. EU – Peru – Columbia (2nd generation, more comprehensive)
in force since 1st March 2013 with Peru, Columbia being
finalised
2. Agreements with Latin American countries
ECDPM Page 28

29. • EU – Mexico: does not cover all agricultural products but covers
goods. Mex is an important producer of textiles
• EU – Chile : do not cover all agricultural products
• EU – CA and EU-Peru-Columbia: DFQF (they already GSP+
countries)
Rules of origin for EU-CA and EU Peru-Columbia:
- Bilateral Cumulation;
- Diagonal cumulation between: EU, Columbia and Peru on the one
hand; and Costa Rica; El Salvador, Guatemala; Honduras;
Nicaragua; Panama and Venezuela; or at the request of C and P
for materials originating from Central America, Latin America and
Caribbean countries if:
-Products are sufficiently worked;
-RoO are identical in these countries;
-Countries have signed a customs cooperation agreement + certification
and verification of status
Key elements of Agreements
ECDPM Page 29

30. Preference erosion
ECDPM Page 30
Fish fillets, fresh,
frozen, chilled
Tuna, skip jack
fish prepared and
preserved
Mexico 0.0% 6.8% 6.8%
Chile 3.4% 8.0% 8.0%
Colombia* 0.0% 0.0% 0.0%
El Salvador* 0.0% 0.0% 0.0%
1. Fish and fish product
2. Fruits: bananas, pineapples, mangoes (origin: Central America, Peru)
Bananas Pinepples Mangoes
Plantain, fresh and
dried (08.03.10)
Others, fresh and
dried (08.03.30) Dried Others
MFN 16% 16% 5.8% 5.8% 0%
GSP 12.5% 12.5% 2.3% 2.3% 0%
FTA 0% 0% 0% 0% 0%
3. Coffee, tea (origin: Columbia, Central America)
Coffee (09.01) Not roasted Roasted
Coffee substitute
containing coffee
(09.01.90.90)
Not decaf
(09.01.11) Decaf (09.01.12) Not decaf (09.01.21) Decaf (09.01.22)
MFN 0% 8.3% 7.5% 9.0% 11.5%
GSP 0% 4.8% 2.6% 3.1% 8.0%
FTAs 0% 0% 0% 0% 0%

31. ECDPM Page 31
4. Cocoa and cocoa products (origin mainly Ecuador, Peru)
Cocoa beans (18.01) Cocoa paste (18.03) Cocoa butter (18.04) Cocoa powder (18.05)
MFN 0% 9.6% 7.7% 8.0%
GSP 0% 6.1% 4.2% 2.8%
FTA 0% 0% 0% 0%
Chocolate (18.06) 0%<sucrose<5% 5%<sucrose<65% 65%<sucrose<80% >80% sucrose
MFN 8% 8% + €25.2/100kg 8% + €31.4/100kg 8% + €41.9/100kg
non-pref TRQ 43% 43% 43% 43%
GSP 2.80% 2.8% + €25.2/100kg 4.5% + €31.4/100kg 4.5% + €41.9/100kg
FTA 0% 0% 0% 0%
5. Textiles products (origin: Mexico, Central America)
Tshirt cotton Shirts Cotton
T Shirts man-
made Trousers Denim fabric
Cotton
Fabric
Pullover
cotton
Pullover
wool yarn
MFN 12% 12% 12% 12% 8% 8% 12% 12% 3.8%
GSP 9.6% 9.6% 9.6% 9.6% 6.4% 6.4% 9.6% 9.6% 3.8%
FTA 0% 0% 0% 0% 0% 0% 0% 0% 0%

32. 6. Other potential exports to EU
ECDPM Page 32
Cut flowers Roses (06.03.11) Carnation (06.03.12) Orchids (06.03.13) Others (06.03.90)
MFN 12% 12% 12% 10%
GSP 8.5% 8.5% 4.2% 6.5%
FTA 0% 0% 0% 0%
7. Nuts
Cashew nuts,
in shell and
shelled
Almonds,
bitter
Almonds
others
Macadamia
, in shell
and shelled
Hazelnuts, in
shell and
shelled
Walnuts,
in shell
Walnut
shelled
Pistachio,
in shell
and
shelled Pine nuts
MFN 0% 0% 5.6% 2% 3.2% 4.0% 5.1% 1.6% 2%
Non pref TRQ n/a n/a 2.0% n/a n/a n/a n/a n/a n/a
GSP 0% 0% 2.1% 0% 0% 0% 0% 0% 0%
FTA 0% 0% 0% 0% 0% 0% 0% 0% 0%

33. • South Korea signed an FTA with the EU in 2011. This FTA is
considered as the most advanced trade agreement the EU has
signed so far. S. Korea does not benefit from full duty free
and quota free market access to the EU.
• On average, S. Korea is not a large trading partner to the EU:
EU’s share of imports from S. Korea represents 2% of its total
imports and EU’s share of exports to Korea also represents 2%
of total EU export.
• However, for specific sectors, such as automobile and
machinery, S. Korea is an important player
3. EU – South Korea
ECDPM Page 33

34. ECDPM Page 34

35. • Textile products: South Korea is not a major exporter of textiles to the
EU. Main markets are in Asia – Mainly Japan and China
• FTA will provide DFQF EU market. However, RoO are quite strict for textile
products (double stage transformation – value tolerance 8 – 10% of the
weight of basic materials used)
Overview of preferences granted to S. Korea in selected
products
ECDPMPage 35
Fish fillets, fresh,
frozen, chilled
Tuna, skip jack
fish prepared and
preserved
South Korea 13.5% 16.0% 16.0%
Fish and fish products – S. Korea exports mainly prepared and preserved
fish to EU (15.5% of its total exports go to EU). No DFQF; derogation; RoO:
vessel and crew requirement; value tolerance 10% of ex-works price)
Tshirt cotton Shirts Cotton
T Shirts man-
made Trousers Denim fabric
Cotton
Fabric
Pullover
cotton
Pullover
wool yarn
MFN 12% 12% 12% 12% 8% 8% 12% 12% 3.8%
GSP 9.6% 9.6% 9.6% 9.6% 6.4% 6.4% 9.6% 9.6% 3.8%
FTA 0% 0% 0% 0% 0% 0% 0% 0% 0%

36. Beef, fresh, chilled and frozen (no DFQF, but 50% lib)
ECDPM Page 36
Meat of bovine animals,
fresh and chilled
Carcasse / half carcasse
(02.01.20)
Other cut with bone
(02.01.20) other (02.01.20.90.10)
Boneless incl buffalo
(02.10.30)
MFN 12.5% + €176.80/100 kg 12.5% + €176.80/100 kg 12.5% + €265.2/100 kg 12.5% +€176.1/100 kg
Non Pref TRQ n/a n/a n/a n/a
GSP n/a n/a n/a n/a
South Korea 6.4% + €88.4/100 kg 6.4% + €88.4/100 kg 6.4% + €132.6/100 kg 6.4% + €88.4/100 kg
Meat of bovine animals,
frozen
carcasse/ half carcasse
(02.02.10) Other cuts 02.02.20) Boneless (02.02.30) Others (02.02.30.90)
MFN 12.8% + €176.8/100kg 12.8% + €176.8/100kg 12.8% + €221.10/100kg 12.8% + €304/100kg)
Non Pref TRQ n/a 20% 20% 20%
GSP n/a n/a n/a n/a
South Korea 6.4% + €88.4/100 kg 6.4% + €88.4/100 kg 6.4%+€110.55/100kg 6.4%+€152.5/100kg

37. EU current FTA negotiations and
potential impact on Africa
ECDPM Page 37

38. US represents 16% of the total trade of EU, mostly in industrial pdts
1. EU–US Trans-Atlantic Trade & Investment Partnership
ECDPM Page 38

39. Composition of trade and tariffs
ECDPM Page 39

40. Key issues to watch out for Africa
1. Discussions on agriculture:
- EU regulations against GMO crops;
- Restrictions on import of beef, chicken that are fed with
ractopamine, an additive that promotes the growth of lean
muscles in livestock;
- Other food safety rules in EU
2. NTMs linked to investment and procurement restrictions (in the
US buy-America; in EU support to SMEs)
3. RoO are likely to be very flexible to foster integration of global
value chains
ECDPM Page 40

41. 2. Other EU trade partners: Which regimes apply?
ECDPM Page 41
India
Thailand, Philippines,
Malaysia, Vietnam
Pakistan
Regime
GSP - some products are
excluded from
preferences
GSP
Special regime for
75 products, GSP
for the rest
State of play of EU trade policy:
-India, Thailand, Malaysia, Vietnam: Currently negotiating FTAs
-Philippines: Considering negotiating FTAs (not started yet)
- Pakistan: Special incentive

42. a. India: currently negotiating an FTA
Why?
- An important partner for the EU, a high potential emerging economy
- Middle class is rising (currently 150 million, expected to reach 600
million in 2020) – HUGE market potential for EU products
Current state of play:
• India is a beneficiary of the EU's GSP scheme. In 2010, around 85%
of Indian exports to the EU entered under a zero or a preferential
tariff. But average tariffs is high in India for EU products (31.8 %
for agric and 10.1% for industrial products)
• FTA launched in 2007 - expected to cover 25% of world population and
30% of world GDP
ECDPMPage 42

43. • EU not expected to provide DFQF – will liberalise 95% of its market
(with an exclusion list of 226 products, mostly chemicals,
petrochemicals, plastics, ceramics and glassware.
• India expected to liberalise 90%, with an exclusion list of about 150
agricultural goods (including dairy products, sugar, fruits and vegetables,
meat products, fish and fish products) and 250 manufactured products
such as some textiles and clothing, textile machinery, cars, and wines
and spirits.
Key challenges: India is inflexible on tariffs on automobiles (peak of 60%);
access to wines and spirit; want to exclude products where EU has
subsidies (dairies).
• Concerns regarding clauses on human rights, social and environmental;
labour standards.
• Strict requirements on Intellectual Property Rights issues from EU, which
may curtail the production of cheap generic drugs, especially AIDS drugs
which India exports to Africa.
• Concerns in Services – movement of people, liberalisation of services
such as professional services
ECDPMPage 43

44. India exports under the Generalised system of preferences. Big producer of
textiles
Rate of duty applied to Indian textile products
ECDPMPage 44
T-Shirt
Cotton
Shirts -
Cotton
Trousers
T-Shirts
man made
Denim
fabric
Pull
Cotton
Cotton
Fabric
Yarn
Pull
Wool
Duty applied
to Indian
products
9.6% 9.6% 9.6% 9.6% 8.0% 9.6% 8.0% 3.8% 9.6%
Scheme GSP GSP GSP GSP MFN GSP MFN MFN GSP
GSP preferences are suspended for yarn and fabric because the value of EU imports
from India for 3 consecutive years exceeded 14.5% of total EU imports of yarn and
fabric from all GSP countries. Here India pays the normal tariff (non-preferential).
RoO: GSP Rules apply: double transformation

45. b. Viet Nam
EU signed a Partnership and Cooperation Agreement with Vietnam in June
2012. This is a political agreement.
Negotiations have started on a FTA in June 2012. Main Vietnamese textile
products are cotton pullovers, t-shirts (cotton, man made and
trousers. Vietnam is not an LDC and benefits from GSP Scheme.
ECDPMPage 45
Pull
Cotton
T Shirt
Cotton
Trousers
T Shirts
man made
Shirts
Cotton
Cotton
Fabric
Pull Wool
Denim
Fabric
Tariff applied
to Vietnam
9.6% 9.6% 9.6% 9.6% 9.6% 6.4% 9.6% 6.4%
Regime GSP GSP GSP GSP GSP GSP GSP GSP

46. c. Thailand and Philippines
Important producer of numerous textile products and fisheries
ECDPMPage 46
Pull Cotton
T Shirt
Cotton
Trousers
T Shirts
man made
Shirts
Cotton
Cotton
Fabric
Pull Wool
Denim
Fabric
Tariff applied
to Thailand
9.6% 9.6% 9.6% 9.6% 9.6% 6.4% 9.6% 6.4%
Regime GSP GSP GSP GSP GSP GSP GSP GSP
Tuna, skip jack
fish prepared and
preserved
Fish fillets, fresh,
frozen, chilled
Tariff applied to Thailand and
Philippines 20.5% 20.5% 14.5%
Regime GSP GSP GSP

47. ECDPMPage 47
Rules of origin
1. Fish fillets: Wholly obtained
2. Tuna, skipjacks and prepared fish: all materials from fresh fish are wholly
obtained
Value tolerance: 15% ex-works price
Derogations: No derogations
Vessels:
Registration and flag requirements;
Either 50% owned by nationals or owned by company with head office in country or
EU + at least 50% ownership
Possibility to use Regional cumulation to vessels of different beneficiary countries
(product will have origin of country which flag the vessels)

48. d. Pakistan (Special arrangement)
• Pakistan is an important partner for the EU, although trade and
investment remain below its potential.
• In 2011, after a severe flood resulting in a serious impact on
Pakistan's economy, EC agreed on a package of measures to assist in
the recovery of Pakistan's economy.
• One element of this package is the granting of 2 years unilateral trade
preferences on a number of goods (75 products) imported into the EU
from Pakistan. Duty free for 55 products; tariff rate quotas for 20
products
• Most products are textile products. These include yarns, fabric and
apparel – but most products on interest to Africa are NOT
INCLUDED. The normal GSP applies to these products and Pakistan
pays the same duties as Vietnam above.
ECDPMPage 48

49. ECDPMPage 49
With the exception of wool pullovers, Pakistan’s main market for textiles products
is in fact the US, with the EU representing less than 25% of Pakistan’s exports
Pull
Cotton
T Shirt
Cotton
Trousers
T Shirts
man made
Shirts
Cotton
Cotton
Fabric
Pull
Wool
Denim
Fabric
Tariff applied
to Pakistan
9.6% 9.6% 9.6% 9.6% 9.6% 6.4% 9.6% 6.4%
Regime GSP GSP GSP GSP GSP GSP GSP GSP

50. What then for Africa?
ECDPM Page 50

51. 1. Strengthen and stimulate internal (i.e intra and inter-regional)
demand:
a. Boost intra-Africa trade;
b. Support and encourage regional value chains;
c. Boost industrialisation
2. External trade: Work on export competitiveness (c.f China);
a. This includes having a foreign trade policy, based on national and
regional realities and priorities;
b. Focus on standards;
c. Address unnecessary trade and investment barriers;
d. Enhance trade facilitation (both soft and hard infrastructure; behind
and beyond the border measures; beyond the continent)
A 2-pronged approach
ECDPM Page 51

52. Thank you
www.ecdpm.org
www.slideshare.net/ecdpm
Page 52

53. ECDPMPage 53
Cumulation explained:
Bilateral cumulation: Applies to members of a single FTA, operated between 2
partners.
Diagonal cumulation:
• Applies between 2 or more countries.
• Requires a network of FTAs containing identical RoO and diagonal cumulation
involving all the countries of the zone.
• Allows originating materials to be further processed in the region
• Value added in the last stage of production should exceed the highest customs
value of any of the inputs used from countries in the regional grouping
• The Pan-Euromed System (42 participating countries) is based on the application
of a common set of RoO within all RTAs concluded among countries in the region
Full cumulation (EEA, EC, Algeria, Morocco, Tunisia)
• Operating between 2 or more countries;
• Countries must have identical RoO and provide for full cumulation
• Working or processing may be done on non-originating material in any partner
country (cumulation of processing is possible). Therefore any processing in a
participating country can be counted as qualifying content, regardless if processing
is sufficient to confer originating status.