1. F. Matambalya / Cotton Marketing1 State of Play of the EAC-EU EPA Negotiations By Prof. Francis Matambalya University of Dar es Salaam fmatambalya@yahoo.com

2. F. Matambalya / Cotton Marketing2 Content Background to EAC EPA Configuration. Essence of EAC EPA Configuration. Viability of EAC EPA Configuration. Challenges. State of Play of the NEG. Conclusion.

3. F. Matambalya / Cotton Marketing3 1. BACKGROUND TO EAC EPA CONFIGURATION

4. F. Matambalya / Cotton Marketing4 1.1. Origin of the Idea for EAC Configuration Origin of the idea enshrined in the Cotonou Agreement itself: Resolve to promote regional integration through EPAs Flexibility allowed regarding configuration EAC covered by: EU-commissioned (1998) ACP-commissioned EPA impact studies (1999/2000).

5. F. Matambalya / Cotton Marketing5 1.1. Origin of the Idea for EAC Configuration – conc. GLR Kampala Summit of April 2002: Attended by Presidents Mkapa (Tanzania), Arap Moi (Kenya), Museveni (Uganda), Buyoya (Burundi) Rwanda represented by Foreign Minister Charles Murigande DRC represented by a high level delegation Directed that EAC States shall negotiate EPA as a bloc. Directed that EAC States shall negotiate EPA as a bloc Also invited to join: Burundi DR Congo Rwanda

6. F. Matambalya / Cotton Marketing6 1.2. ESA EPA and SADC EPA Configurations Contrary to the Kampala summit decision: Burundi, Kenya, Rwanda and Uganda configured themselves to negotiate EPA in the ESA group. Prior to this decision, Tanzania was not consulted by its EAC partners. Tanzania decided to negotiate EPA in the SADC EPA group.

7. F. Matambalya / Cotton Marketing7 2. ESSENCE OF THE EAC EPA CONFIGURATION

8. F. Matambalya / Cotton Marketing8 2.1. Aspirations for Deeper Integration

9. F. Matambalya / Cotton Marketing9 2.2. Popular Support of the idea in the region Academia. Corporate East Africa. Political East Africa. Civil society.

10. F. Matambalya / Cotton Marketing10 3. VIABILITY OF THE EAC EAC EPA CONFIGURATION

11. F. Matambalya / Cotton Marketing11 3.1. Consistent with Cotonou Agreement Legally, consistent with the Cotonou Agreement Articles 35.2, 37.5 and 37.7: EPA can be negotiated between group of ACP states and the EU EPA can be negotiated between an individual ACP state and the EU An ACP state can opt for an arrangement other than EPA

12. F. Matambalya / Cotton Marketing12 3.2. Critical Economic Mass for Strategic Partnership with the EU EAC forms a critical economic mass for strategic partnership with the EU (cf. tables 1, 2, 3) Some of the economic and/or political entities NEG with the EU are much smaller than EAC1 (i.e., Burundi, Kenya, Rwanda, Tanzania and Uganda). EAC2 (without Kenya).

13. F. Matambalya / Cotton Marketing13 3.2. Critical Economic Mass for Strategic Partnership with the EU – contd.

14. F. Matambalya / Cotton Marketing14 3.2. Critical Economic Mass for Strategic Partnership with the EU – contd.

15. F. Matambalya / Cotton Marketing15 3.2. Critical Economic Mass for Strategic Partnership with the EU – conc.

16. F. Matambalya / Cotton Marketing16 4. CHALLENGES TO EAC EPA CONFIGURATION

17. F. Matambalya / Cotton Marketing17 4.1. Complicated Approach to NEG Tanzania continues to NEG in the SADC EPA configuration The remaining EAC Countries continue to NEG in the ESA configuration But: The 5 EAC states will sign a single EAC-EU EPA!

18. F. Matambalya / Cotton Marketing18 4.2. Lukewarm Commitment By Kenya? Sends junior officers to NEG with the EU Believed to divided: Wants deeper EAC integration Prefers ESA EPA configuration to govern its relations with the EU Can the same be said about Burundi and Rwanda (also send junior officials to NEG with the EU)

19. F. Matambalya / Cotton Marketing19 5. STATE OF PLAY OF THE NEGOTIATIONS

20. F. Matambalya / Cotton Marketing20 5.1. Latest NEG Round – conc. Last NEG at Ministerial level took place in Brussels on 14 th November: EAC represented by: Burundi: Kenya: Minister Plenipotentiary, Brussels Mission Rwanda: Minister Plenipotentiary, Brussels Mission Tanzania: Minister for EAC Co-operation Uganda: Deputy PM and Minister of EAC Co-operation EU represented by: Commissioner for Trade Commissioner for Development:

21. F. Matambalya / Cotton Marketing21 5.2. Main Agreements As a CU, the EAC will engage in EPA process as a bloc and will conclude the interim EPA Agreement as a separate configuration. EAC and EU to work towards a Framework Agreement for the time remaining until the expiry of the Cotonou Agreement on 31 st December 2007. Framework Agreement to be applied provisionally from 1 st January 2008. EAC and EU will complete a comprehensive Agreement thereafter.

22. F. Matambalya / Cotton Marketing22 5.3. Elements of the Framework Agreement Market Access. Development Co-operation. Fisheries. Built in agenda (specifying mechanism for continuation of NEG beyond 31 st December 2007).

23. F. Matambalya / Cotton Marketing23 5.4. Market Access DFQF MA by the EU to the EAC States for all products, except: Sugar. Rice. 81 percent of EAC imports from the EU to benefit for liberalisation phased over a transition period of 25 years. Sensitive list of AG and industrial products for EAC states. EAC’s MA offer to the EU to be refined further.

24. F. Matambalya / Cotton Marketing24 5.5. Development Co-operation EAC and EU to conclude a text on how to handle development issues. Such text to take into account: Text “already agreed by the EU with configurations in the region” (ESA, EPA) Existing Interregional Co-ordination committee (IRCC) EU to finance necessary adjustments.

25. F. Matambalya / Cotton Marketing25 5.6. Built-in Agenda / Way Forward Technical experts to finalise the framework agreement. Further work to be undertaken to finalise the EAC MA offer to the EU Initialling of the framework agreement not later than 23 rd November Continuation with the NEG as per the framework agreement.

26. F. Matambalya / Cotton Marketing26 6. CONCLUSION

27. F. Matambalya / Cotton Marketing27 Several Issues Success of the EAC integration will be judged by how the handle the EPA issue. To be successful, the EAC States need to consolidate their solidarity and commitment to the EAC.