GHANA-EU ECONOMIC PARTNERSHIP AGREEMENT (EPA) D A N I E L A D J E T E Y S O W A H M I N I S T R Y O F T R A D E A N D I N D U S T R Y
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1 GHANA-EU ECONOMIC PARTNERSHIP AGREEMENT (EPA) D A N I E L A D J E T E Y S O W A H M I N I S T R Y O F T R A D E A N D I N D U S T R Y
2 Presentation Structure Overview of Ghana-EU Trade Total Trade Imports Exports EPA Imports Exports Benefits and Challenges Way forward (Measures to take advantage)
3 Overview of Ghana-EU Trade TOTAL TRADE: IMPORTS A ND EXPORTS
4 EU - Ghana s Largest Trade Partner Source: IMF DOTS 2013
5 Ghana-EU Imports and Exports have been increasing Source: IMF DOTS 2013
6 Ghana s Imports from the EU Source: TradeMap 2014
7 Ghana s Exports to the EU Source: TradeMap 2014
8 IN SUMMARY Trade between Ghana and the European Union have been increasing over the years Both in imports and exports, the EU remains an important origin of and destination for most Ghanaian goods Currently the largest trading partner for Ghana
9 Economic Partnership Agreement (EPA) Negotiations between ECOWAS and EU for an Economic Partnership Agreement have been ongoing. In order retain the market share as well as protect and prevent the disruption of exports to the EU, Ghana initialed the IEPA in Dec. 2007
10 ECOWAS EU EPA Negotiations and discussions with ECOWAS member countries have been ongoing. After some time had elapsed, it then resumed and currently 14 out of the 16 West African countries have signed the Regional EPA LDCs(12 countries in W/A) have a DFQF market access to the EU under the Everything but Arms (EBA) with or without EPA.
11 ECOWAS EU EPA (contd) Four (4) developing countries in the region ( Cote d Ivoire, Ghana, Nigeria and Cape Verde, however, (without any EPA) risk EU export disruption Two (2) countries however have not signed yet. This includes Nigeria and Gambia The Agreement however, requires all member countries in the ECOWAS bloc to sign and ratify.
12 ECOWAS EU EPA (contd) The deadline for signing and ratifying is October 2016 The Agreement would ensure Duty-Free-Quota-Free access into EU for all imports from West Africa; Asymmetric and gradual opening of West Africa market to EU goods. West Africa committed to liberalize 75% of imports from the EU over a period of 20 years;
13 Ghana s Exports to the EU with EPA Biggest exports to EU are petroleum oils and cocoa beans Ghana will not need EPA to aid the export of these products EPA - helpful for non-traditional exports many of which would otherwise face high tariffs: Processed cocoa (butter, paste, powder) Tuna Edible fruit and nuts Processed-agric products EPA opportunity to promote new exports! Value-added products with high tariffs Horticultural products
14 Ghana s Imports to the EU with EPA Some Ghanaian producers will face increased import competition from the EU. For example those in the production of: Cement clinkers Certain steel /iron construction products Quicklime Aluminium foil Certain garments
15 REQUIREMENTS Must ensure Ghanaian exporters are prepared to access EU market Satisfy Sanitary and Phyto-Sanitary (SPS) requirements Meet Rules of Origin requirements Improve Logistics Construct cold storage facilities Facilitate trade
16 Trade Defence Measures Improve capacity to implement Trade Defence Measures where necessary: Anti-dumping Countervailing Duties Safeguarding Duties
17 CONSIDERATIONS Not ratifying the EPA would automatically revert Ghana to the Generalised System of Preferences (GSP) regime, which is less favourable. Not signing the iepa/epa could pose a threat to the emerging non-traditional export sector of the Ghanaian economy. Not signing the iepa/epa is a threat to economic growth and development.
18 BENEFITS Fundamentally the EPA provides an opportunity to: Attract external investment and boost the productive capacities of the Ghanaian economy; Realise export-led industrialisation strategy through preferential access;
19 BENEFITS (contd) Reduce costs for businesses which import inputs, such as lining for garments and flour for bakeries, and high-tech capital machinery and equipment; Secure duty free market access to the EU market for Ghana s priority non-traditional exports, including prepared or preserved tuna, cocoa butter and cocoa paste, fresh vegetables, aluminium manufactures, wood manufactures, textiles and garments, bananas and plantains, pineapples, cassava, yam, fruit juices, dried fruits, and palm oil;
20 BENEFITS (contd) Improve consumer choice through increased varieties of goods at reduced costs to Ghanaian households for items such as bicycles, motorcycles, baby milk, personal computers, and TV sets; Provide a platform for rejecting subsidised agricultural imports that unfairly compete with Ghanaian farmers;
21 BENEFITS (contd) Channel funding, in particular the EU s European Development Fund (EDF), towards critical areas identified as being required for export growth and development; Improve quality standards for exports as well as for domestically consumed produce;
22 CHALLENGES Constraints to maximising the opportunities of the EPA: Limited access to affordable long- and medium-term credit facilities that enable companies to effectively and sustainably finance their business operations. Highly inadequate and erratic supplies of key economic enablers namely electricity and water as well as insufficient transport infrastructure. Obsolete machinery, equipment and technology resulting in low output and high maintenance costs.
23 CHALLENGES (contd) High export market development and promotion costs that include participating in trade fairs, in/outward-bound missions, and primary export market research. Uncompetitive packaging and marketing materials. Insufficient storage, cold chain and logistics infrastructures.
24 CHALLENGES (contd) Non-Tariff Barriers, including SPS measures and other Technical Barriers to Trade (TBT), and in particular challenges in meeting increasingly stringent quality standards.
25 MEASURES TO TAKE ADVATANGE Develop a long term production strategy with great emphasis on particular value chains through consultations with the private sector Considerable attention should be given to agro-based industrialisation Address supply side constraints. Governments investments should be coordinated ensuring that provision of infrastructure is in sync with broader industrial strategies.
26 SOME MEASURES
27
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