The EP Trade committee gave its green light to an Economic Partnership Agreement (EPA) with six member states of the Southern African Development Community (SADC) on Thursday.

The deal offers duty free access for products from Namibia, Mozambique, Botswana, Swaziland, Lesotho and improved EU market access for South Africa. To maximize the impact of the deal, a robust monitoring scheme should be put into place, MEPs argue.

“This development-oriented regional trade agreement has the potential to contribute to sustainable economic growth and deepened intra-regional trade and integration. The SADC States should, however, conduct trade and development-friendly domestic policies, pursue structural reforms and consider using the potential of the EPA by going beyond trade in goods and address services in the future. The EU needs to provide assistance for capacity building, while the EP has to monitor implementation,” said rapporteur Alexander Graf Lambsdorff (ALDE, Germany) before the vote.

Trade MEPs recommended that the House gives its consent to the deal by 22 votes in favour, 9 against with 1 abstentions.

The agreement establishes a “positive discrimination” for the SADC EPA partners, ensuring immediate duty- and quota-free access to the EU market. It also creates new regional opportunities through a more flexible use of rules of origin. The African countries will liberalise 86% of trade with the EU (Mozambique 74%) over ten years with the exception of agricultural and fishery products. It replaces the previous interim agreements based on unilateral trade preferences which the the EU has granted so far to the six states, and establishes a contractual arrangement that complies with World Trade Organisation (WTO) rules.

MEPs note that while the agreement covers only merchandise trade and development-cooperation, it leaves the door open for services, investment, intellectual property and public procurement. The deal is expected to boost regional and economic cooperation and good governance.

To mitigate potential negative impacts several safeguards were added to the deal. A key demand of the African partner countries was met with the use of agricultural export subsidies no longer allowed upon entry into force of the EPA, International Trade MEPs say.

As for development cooperation, a detailed chapter identifies trade-related areas that could benefit from EU support, although no financial commitment has been made at this stage.

MEPs would also like to strengthen the monitoring of the agreement to make sure that its “benefits for the people” are maximised. The Committee adopted an oral question to the Commission on Parliamentary oversight and civil society monitoring of the agreement for the September plenary.

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Background

With the Cotonou Partnership Agreement of 2000, African, Caribbean and Pacific Group of States (ACP Countries) and the EU agreed to negotiate reciprocal, though asymmetric trade agreements known as Economic Partnership Agreements mainly to comply with WTO rules. EPAs are also aimed at supporting ACP countries’ sustainable development and gradual integration into the world economy.

Negotiations were expected to be concluded by the end of 2007, but the process eventually took much longer and in July 2014, the EU finished negotiations with six states of the SADC Group. Angola finally decided not to enter into the agreement, but can join in the future. The other eight SADC Member States (Democratic Republic of Congo, Madagascar, Malawi, Mauritius, Seychelles, Tanzania, Zambia and Zimbabwe) are part of other regional EPA configurations.