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South Africa: Trade Beat
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Business Day (Johannesburg)
COLUMN
5 August 2008
Posted to the web 5 August 2008
Mathabo le Roux
MATTERS agricultural continue to stymie world trade talks, but they are not the only obstacles.
DOHA DEVELOPMENT ROUND
AT THE time of going to press, trade ministers of 35 countries were still locked in meetings in Geneva in a bid to break a seven-year stalemate in talks on a multilateral trade pact. Observers were pessimistic that a deal would be reached as consensus on key issues in the agricultural and non-agricultural market access (Nama) texts remained outstanding.
The main issues stalling progress, and which were the focus of talks at the World Trade Organisation (WTO) ministerial were -- in agriculture -- overall trade-distorting domestic support for developed countries; cotton; top-tier tariff cuts for developed countries; sensitive products, which will be shielded from full tariff cuts in return for some market access through quotas with lower tariffs; developing countries' special products which will also be shielded from full tariff cuts; and temporary increases in developing country tariffs to deal with import surges or price slumps -- the so-called "special safeguard mechanism".
On non-agricultural market access the talks centred on the formula of industrial tariff cuts; flexibilities (allowing for smaller tariff cuts); the anti-concentration clause, a proposal included in the Nama text in May to prevent an entire sector from being shielded from cuts; and "sectorals", also a late addition that increases the tariff reduction burden on countries that do not opt for sectoral tariff elimination -- removing tariffs on certain sectors.
SA's chief trade negotiator Xavier Carim said that SA remained concerned about the imbalance in how developed and developing countries' positions were accommodated in the WTO, with greater consideration for developed countries' flexibilities while developing countries' concerns were not accommodated to a similar extent.
US
THE Southern African Customs Union (Sacu) signed a co-operative trade agreement with the US -- the Trade, Investment and Development Co-operation Agreement (Tidca) -- on July 18 to strengthen trade and investment ties and boost development of the southern African region.
One of the main features of the pact was an agreement to cooperate on sanitary and phytosanitary standards, technical barriers to trade and customs co-operation.
EUROPEAN FREE TRADE ASSOCIATION (EFTA)
SACU has finally ratified a free trade agreement concluded with the European Free Trade Association, which comprises Iceland, Liechtenstein, Norway and Switzerland. The Efta states are the only countries in Western Europe not party to the European Union.
The agreement facilitates trade in industrial products, fish and other marine products, and processed agricultural products. Trade in basic agricultural products is governed by bilateral agreements with each of the Efta states. Most industrial goods, including fish and other marine products, now benefit from duty-free access to the Efta states.
MERCOSUR
A DATE is still to be agreed to sign off on a preferential trade deal with Mercosur, which includes Brazil, Argentina, Uruguay and Paraguay. The agreement covers 2000 product lines.
INDIA
NO NEW developments were reported in negotiations on a preferential trade agreement.
ECONOMIC PARTNERSHIP AGREEMENT (EPA)
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AT THE time of going to print President Thabo Mbeki was attending the first SA-EU Summit in Bordeaux, where the EPA was to be on the agenda. Carim said SA would discuss concerns, raised by the European Council in May, on greater flexibility for the Southern African Development Community in the EPA, and see to it that the council's recommendations were taken forward.
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