New Trade and Aid Agreement Between EU AND ACP States
EU TO ALLOCATE 13.8 BILLION EUROS FOR DEVELOPMENT COOPERATION WITH ACP STATES
Ms. Liz O'Donnell T.D, Minister of State at the Department of Foreign Affairs, today welcomed the successful conclusion of negotiations between the EU and seventy one African, Caribbean and Pacific States (ACP) on a new trade and aid agreement.
Ms. O'Donnell said that "the new Agreement, reached after nearly two years of negotiation, marks a major advance in the EU's relations with the developing world."
The agreement modernises the existing Lome Convention, which expires on 1 March 2000. On the trade side the Agreement provides for future Regional Economic Partnership Arrangements between the EU and regional trade areas within the ACP States. These new Arrangements, which should enter into force by 2008, will over time evolve into free trade between the EU and the ACP regional trade areas.
Ms. O'Donnell, said "the new updated Lome Convention has set down the path for the future relationship between the EU and the African Caribbean and Pacific States. The original 1975 Lome Convention was the first ever trade and development agreement between two such large groups of States. This new agreement brings the original agreement into the 21st century. It recognises the importance of globalisation and the need to integrate developing countries into the global economy.
As our own national experience has shown, exports and the ability to trade are a key component of development. The EU and the African, Caribbean and Pacific States are now committed to concluding new trade arrangements which will revolutionise trade between them. The ACP States will be helped to integrate into the global economy and to increase their trade with the EU. This will bring major benefits for their peoples and their economies."
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Recognising that a move to free trade between the EU and developing countries would be a complex and difficult process, Ms. O'Donnell said "The new agreement opens up the perspective of free trade. This does not mean that the markets of some of the poorest countries in the world will overnight be exposed to full competition from EU products. The negotiations leading to free trade arrangements will take into account the differences in economic development. There will be transition periods and assistance to developing countries to enable them to export to the EU. Agreements leading to free trade will only be concluded by 2008 and only with countries who wish to enter such arrangements.
"In addition the EU is committed to granting duty and quota free access to the EU market for essentially all products from the poorest countries in the world by 2005. This commitment, which we also want other major trading powers to adopt, will provide major trade benefits to these countries who risk marginalisation from the global trading system. It has been very strongly supported by Ireland".
In addition to concluding a new trade and aid package with the ACP States, the EU also agreed to allocate 13.8 billion euros to the European Development Fund in the five years to 2005. The Fund is the main source of development funding from the EU to the ACP States. While welcoming the decision to replenish the Fund with 13.8 billion euros, Ms. O'Donnell said that Ireland would have preferred to have an even higher allocation. "In the discussions on the allocations to the Fund, Ireland argued for an allocation of over 14 billion euros. We believed the higher total was necessary to maintain the value of the fund in real terms and to make a strong gesture of solidarity with the ACP States".
Ireland's contribution to the Fund, will be around 86 million euros over five to seven years.
Note for Editors attached - 3 -
Note for Editors
Negotiations on a successor to the Lome Convention, the agreement governing trade and development relations between the EU and seventy one African, Caribbean and Pacific (ACP) States concluded successfully at 11pm yesterday in Brussels. The agreement will be formally signed in May 2000.
The new EU-ACP Agreement provides that in 2002 the EU and regional trade blocs in the ACP states (e.g. Caricom in the Caribbean, SADC in Southern Africa, SOPAC in the Pacific) will enter into negotiations on Regional Economic Partnership Agreements. The new Agreements should be concluded by 2008 and will provide for free trade between the EU and the ACP regional trade blocs. The moves towards free trade would begin in 2008 and could take as long as a further 12 years.
ACP countries not wishing to enter such free trade arrangements would continue to enjoy special trade preferences for their exports to the EU. The EU has given a commitment that Least Developed Countries should be able to export essentially all products duty free to the EU by 2005.
The EU also agreed to replenish the European Development Fund with 13.8 billion euros. The Fund will provide development assistance from the EU to the ACP States between 2000 and 2005. Ireland's share of the Fund is 0.62% or 86 million euros. Top