Sunday, April 08, 2007

European Commission Proposes New Tariff Deal

Source: EU Tariffs Offer for Ex-Colonies

The European Commission has released a plan that would terminate the quotas and tariffs that it currently imposes on exports from many African, Caribbean and Pacific nations (ACP nations). The ACP nations are mostly former European colonies and include Nigeria, Kenya, Cuba, East Timor and South Africa. The plan would have to be approved by the end of 2007.

The vast majority of exports to the EU from the 78-member ACP group are already tariff-free, or taxed at low levels. This new plan would remove the quotas and tariffs remaining on vegetables, cereal, and beef in 2008, and remove the quotas on rice and sugar around 2015.

This offer follows a World Trade Organization ruling that required the EU to terminate its preferential treatment deals with ACP nations and develop a new trading framework.

The offer was not fully extended to South Africa, which the European Commission said produced “a number of globally competitive products.”

Critics have suggested that the EU has used these negotiations over a new tariff deal to gain greater access to the markets of ACP nations – an allegation the Commission vehemently denies. The European Commission maintains that the new offer is not conditional on ACP setting aside their own tariffs and quotas and that the plan will “create the best possible opportunities for these economies.”

Questions: Will this new deal make a difference to the ACP group which includes some of the poorest nations in the world? Is there anything else that the Commission could do to satisfy the WTO ruling?

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