NAIROBI, Kenya, Feb 17 – The European Union (EU) is optimistic that the Economic Partnership Agreements (EPAs) talks with the East African Community (EAC) will be concluded next month.
Ambassador and Head of Delegation of the EU to Kenya Lodewijik Briet said 97 percent of the talks have been completed with only few underlying issues left for consultations.
“Now we are on a good space… what separates us are just a few last remaining issues, they are difficult issues but they are important,” he said.
Briet said the main outstanding issues to conclude the negotiations are the clause on most favoured nation provisions as well as the issue of export taxes.
The envoy said with flexibility from both sides as well as political will, the agreement will be reached, pointing out that further discussions on rules of origin and agriculture still need to be held at the technical level to be ironed out.
Failure to sign the agreement before October 1 will result in high tariff hikes on EAC’s non-Least Developed Country’s (LCD) exports to the EU, with Kenya being the only non-LDC in the EAC region thus attracting import duty on her exports.
Flower exports to the EU will attract an import duty of 8.5 percent which will force the prices of Kenya flowers to go up and face stiff competition from other nations such as Colombia that export flowers to the EU on a Duty Free-Quota Free basis.
Close to 70 percent of Kenya’s total flower production is currently exported to the EU.
Twenty three percent of Kenya exports worth Sh110 billion were shipped to EU member states in 2012.
Within the EU, the United Kingdom has been Kenya’s leading export market, followed by the Netherlands and Germany.
The main export products to the European Union markets include horticulture (including flowers, of which Kenya’s products account for 36 percent of all EU flower imports) and tea, where Kenya’s main markets are Pakistan, the UK, Egypt, the Netherlands and the USA.
The latest round of negotiations took place in Brussels at the end of January 2014 and was joined by a joint ministerial meeting co chaired by Kenya’s EAC, Commerce and Tourism Cabinet Secretary Phyllis Kandie.
The next round of talks are expected in March in one of the EAC countries.