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Copyright ©2014 Parliament of the Co-operative Republic of Guyana.

Things Associated With EPA and Its Predecessor

Hits: 1285 | Published Date: 10 May, 2012
| Speech delivered at: 20th Sitting - Tenth Parliament
| Speech Delivered by : Hon. Carl B. Greenidge, MP

Mr. Greenidge: Thank you very much Mr. Speaker... [Interruption]       [Mr. Seeraj: Preparing for the long haul]         [Mrs. Backer: At least an hour]        I need your protection here, Mr. Speaker.
Mr. Speaker: You are protected, proceed.
Mr. Greenidge: Thank you very much, Sir. May I start by extending my sympathy to our colleague, Dr. Ramsammy, who seems to have taken a very close interest in things associated with EPA and its predecessor Contonu and Lome and who has concluded in a manner that I think left a lot of us worried as to where he was really going.
I think it needs to be said from the very beginning that we need to avoid terminology that will cause confusion rather than enlighten. First of all, we are in an era, in the international trade arena in which countries such as the Caribbean that may have suffered handicaps in the past and which has been treated in the framework of preferential agreements can no longer depend on the international community to provide them with those special concessions.
I think you need to be reminded also that the Caribbean, as was the ACP, was party to an agreement with the European Union under the various Lome Agreements - Lome ? and then Contonou, in which it agreed that it would seek to move away from dependence on preferences and participation in agreements that discriminated against other developing countries, that is the reality. That is the reality. You cannot sign an agreement about that and then weep about it afterwards, which is what we do and gets us into trouble, internationally.
Let me just point to the implication of one of these issues. If you are a party to an international agreement that says you will not be discriminating against other developing countries, but yet you go into the international arena and seek to preserve for yourself, privileges which discriminate against those, then you will find yourself in the difficulties that we found ourselves with Uruguay, Columbia and other third world partners, Brazil included, fighting us down in those international arenas for abrogating the very principles that we have embraced. Do you understand what I am saying? First of all, therefore, the issue is to understand to what we have committed ourselves.
We also signed in 1995 under the Mauritius Agreement, an agreement that said we would, having got a waiver, a second waiver and a third waiver for Lome move away from that framework. That is the background to the difficulties we are encountering with sugar and bananas in particular. It explains why many of the developing countries who should be our partners have been unwilling to support us in these international agreements. The relevance of this is that, even if the European Union were prepared to fight our case in the international arenas, such as WTO, bear in mind they lost three cases against third world countries on behalf of the ACP countries, sugar and bananas producers and their taxpayers were not inclined to have their taxes used to pay fines to the WTO for failing to honour agreements that were signed more than once.
So that is a background that we have to deal with as a reality and therefore I think that observations that seeks to justify positions taken by our spokesmen, I do not think we need to dwell too long on this, which seems to be positions fighting on behalf of the other world. When they were in fact just grandstanding, needs to be avoided, because that is exactly what they are. We ended up in a situation where in this very country, the first ACP Heads of Government, the first Caribbean Heads of Government meeting I attended after leaving Belgium, I was privileged to hear the President of this country tell off the other heads of Government saying, “Why are you insisting on sending back our agencies to get more money when Mandison himself told us that no more money was available. You are giving them a basket to fetch water.” Within two months of that statement and persuading the other heads to write to the European Union asking to give concessions on services, in return for the concessions that they have given on goods, he was saying to all those who would listen that we were badly treated, we did not know we were negotiating services and a variety of other things. So I think the problem of being a victim here is one that we should try and avoid.
The negotiators who looked at this agreement that is before us, which we are happy to support, had a number of objectives. Let me mention them very quickly because I think they are important in understanding, I want to also say something about funding because I think financing is important in relations to the point raised by our colleague Dr. Ramsammy and then to identify some of the areas of opportunity, if I might do those very quickly.
The objectives that the negotiators tried to satisfy were first of all to try and minimise the negative impact of liberalisation, because liberalisation as many of the critics have pointed out can have disadvantages. Indeed, many of them suggested and if they were right, by now we would have been in complete turmoil, that as soon as the agreement was signed you would have wide spread unemployment and excess production and so forth. That did not happen because the negotiators took into account and the EU also did not have an interest in some of these things happenings so that was the first objective.
Secondly, to maximise market access in goods, goods in particular are mentioned; to retain the preferences and minimise preference erosion as far as possible; and to improve access to services. If the other areas, namely of protecting the bananas, sugar and other products into the European Market can be regarded as the defensive strategy, then the offensive one wants to try and craft a space in the European Union for the services that maybe Guyana does not feel that it can, but the rest of the Caribbean believe that they can do. I will like to make the example that even in Guyana where we have not in recent years regarded ourselves as outstanding exporters of music, we are starting to produce a variety of performers, mostly females I noticed, whether it is Shelly G, Tameka Marshall or the others, who have been making waves and this can generate a lot of income for us as it does for Jamaica and Barbados in recent times and even St. Lucia. We need to make arrangements to be able to capitalise on the export of such services, on the export of the complimentary services going with them, those persons who provide bookings and who move the instruments and so forth, we need to take advantage of those things. So that was one of the charges the negotiators had and for that reasons they regarded it as very unfortunate that Guyana should have been saying publicly and it is not only the President, but Mr. Luncheon who was nowhere near the negotiations, claiming that they never give instructions and they were not aware that services were to be part of the negotiations.
The other goals were to encourage investments that are environmentally friendly, to enhance competitiveness and diversification through and I emphasise through innovation, which means that you cannot continue to expect to access international markets by selling sugar in its raw form based upon cheap labour. You have to take the product, whether it is the plant or the produce and bring innovative techniques to bear on it. So new products; new uses can be put to the same product and so that productivity in the sector can improve. That was one of our charges and I will come back to that in a second.
To protect and stimulate small and medium size enterprises, to promote regional integration, economic cooperation and good governance. The EU’s old user agreements tend to include those. To conclude a modern trade agreement, to keep subjects manageable, I am afraid we did not succeed in that at all, and to secure additional funding for capacity building, integration support and EPA implementation and I say that specifically looking at our colleague, Dr. Ramsammy, because it is true with the points he was raising about the supply side, enhancing the supply side, dealing with sanitary and phytosanitary barriers are costly both in terms of finances and in terms of human resources.
But I would hasten to add that he needs to continue reading the document, because in the document he will find that there is provision for financial and technical assistance to enhance our own capacity to overcome those barriers and so instead of complaining we need to go and search through the document to find what avenues it has.
The Essentials of EPA in return for securing access for the at-used industries, traditional exports, we built into the agreement as symmetry so that those, between ourselves and the EU, we had unequal burdens, they took the greater burden of liberalisation than we did. Within the region also, liberalisation was asymmetrical, the Dominican Republic was liberalised almost of 95% of its goods that it receives from the European Union, whereas on average in the rest of the region, it was 18% that is 86%. So there was symmetry in the fashioning of the agreement and also, we as was mentioned earlier, excluded some 493 items, in other words 13% of all the imports. If you remember that we started off with over 25% of our imports from the European Union coming in free of duty anyway, then you would have to recognise that this liberalisation was never a complete liberation as some of the analysis was alleging.
The other important feature of the agreement was that we sought and obtained from the European Unions, concessions in the area of services in particular and the agreement itself has some characteristics that are rather unusual. First of all you have moratoria on tariff liberalisation, it commenced in 2011. Duties on petroleum, spares were also to be phased out over seven to ten years. The commitments of the EU were and again for the benefit of our colleagues, to assist with technological developments, Small and Medium Enterprises (SMEs) and to help us to learn market requirements in the EU, which are very complicated, again I agree with Dr. Ramsammy, but in so far as there are provisions for enabling us to use the EU’s assistance to capitalise on getting around the different language groupings and different administrative groupings, we need to bear that in mind.
Also to assist, the EU is obligated to assist us with Special Preferential Sugar (SPS) obligations and if you think that is theory let me just remind you that under the Cotonou Agreement itself, the EU has provided such assistance to Caribbean countries and I remember in particular one of the most notable and perhaps most valuable cases pertained to Namibia, where the EU facilitated their ability to export to fish products to the European Union and then there is the question of special and differential treatment for those countries that believe that they are specially disadvantaged, that is also built into the agreement.
Before I end I want to make reference to the question of the... [Mr. Benn: ...Inaudible]   You ought to speak for yourself as well. May I also say that in relations to the agreement, the issue of funding looms very large as you may recall the question of development, a development chapter, was a big issue where persons within the region and elsewhere were calling for a chapter to be included in the agreement. Such a chapter was included and it made provision for a variety of forms of assistance, there were three dimensions in the development agreement that were worth noting; the structure that is the product coverage and the time frame for the tariff reductions that was one dimensions; secondly, the programmes and mechanisms that were intended to address the supply side constraints that is most important again, it applies to the points that were being made just now; and thirdly, there are five elements in the chapter which deals specifically with the discharge of the region’s commitments to other regions.
In relations to funding, there are a variety of windows and I cannot through all of these but I think it is very important also that we look at the agreement in its entirety.
The Cotonou Agreement has funding for the African, Caribbean and Pacific Group of States (ACP), including the Caribbean, under the regional indicative programmes and the national indicative programmes, but there are also elements specific to the Economic Partnership Agreement (EPA), and in relation to the aid for trade dimension, the European Union (EU) has made a specific contribution to that exercise in order to enhance our own capacity to take advantage of that particular area.
I would like to close by saying a few words about the areas of opportunity that need to be borne in mind, in relation to this agreement, because one of our biggest problems is that, in this region, although we have been the ones that have signed complete EPA agreements, Caribbean countries, the English speakers, which led the race along these lines, have actually been lethargic in taking advantage of the agreements.  It is  recognised that there are disadvantages;  the  disadvantages have to be taken  anyway; but  countries need to recognise that since  they have  made that sacrifice  they  might as well do what is necessary to take full advantage of the agreement, and we have not done that.
I would like to draw the House’s attention to the scope that the agreement provides for regional funds to establish operations within the EU and to have joint ventures. I make reference specifically to FP7, which is an innovation programme under which the EU has something as of  €2 billion of funds that will support joint ventures which will generate either new processes or new products, which products or processes can be applicable in either market; the only requirement is that they be of a joint venture. The EU has also agreed to open services beyond its global commitments, and that is more than it has done for other partners with which it has signed, including Asia. Our private sector seems particularly interested in the creative industries. I mentioned music just now, but the private sector in the region has drawn the negotiator’s attention to the fact that  it is especially interested in creative industries and entertainment within that category and, surprisingly, audiovisual services. Concerning audiovisual services, I might say, within Trinidad and Tobago there are two small firms which have been doing very well in this area and the agreement seems, in their eyes, to open opportunities for them.
In the areas of garments, knitted and non-knitted fabrics, smoking tobacco, cigars, and so forth, there are also opportunities and the international trade environment, which we are facing at the moment, does offer opportunities that we can take.
I am making these points just to draw to our colleague’s attention the fact that, again,  an agreement  have been signed, you have to bear the burdens of the agreement. You need to recognise that there are advantages which can be had. You need to gear yourself to take the advantage. It does not have to do with selling somebody else’s product; it has to do with you recognising that you have a burden to carry and you need to lighten that burden, take advantage of the opportunities that the burden carries, almost as collateral damage. Therefore, that is the point I want to make.
The other aspect of this has to do with our own capacity to negotiate. The European Union has provided a range of instruments that I have mentioned. In truth, however, at our own negotiating sessions with the European Union in the standing arrangements – there is now, for example, a meeting taking place in the Dominican Republic – we need to ensure that we speak to it to ensure that it provides resources consistent with our needs and that it provides them at a pace and in a form that is, again, consistent with our needs. If that happens, each country, and CARICOM, has to sit down and look carefully at its needs as well as the instruments that the EU makes available, so that what is fashioned in the end is consistent with our own needs and requirements.
I thank you very much, Mr. Speaker, and will have pleasure in supporting the motion.  [Applause]

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Profession: Economist
Speeches delivered:(33) | Motions Laid:(15) | Questions asked:(12)

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Speeches delivered:(33)
Motions Laid:(15)
Questions asked:(12)

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