RESOLUTION(1)

on the WTO millennium round of negotiations with special reference to ACP rum

The ACP-EU Joint Assembly,

- meeting in Strasbourg (France) from 29 March to 1 April 1999,

A. recalling the Marrakesh agreement establishing the World Trade Organisation, in particular the preamble in which the parties to the agreement recognised, inter alia, that their relations in the field of trade and economic endeavour should be conducted with a view to raising standards of living etc. in accordance with the objective of sustainable development, while seeking to protect and preserve the environment,

B. recalling also that the parties agreed that there was need for positive efforts designed to ensure that developing countries, and especially the least developed among them, secure a share in growth in international trade commensurate with the needs of their economic development,

C. concerned that under the forthcoming review it is likely that there will be amendments to various WTO Agreements which could have an impact on preferential trading,

D. reaffirming its resolution on rum adopted during the 26th Session held in Port Louis (Mauritius) from the 20 to 23 April 1998,

E. recalling the resolution on rum adopted by 68th Session of the ACP Council of Ministers held in Brussels (Belgium) from 28 to 29 September 1998,

F. recalling the trade objective of the Lome IV Convention of promoting trade between the ACP and the Community and considering the provisions of Protocol Nο 6 for the duty free entry of ACP rum to the EU market was designed to ensure that developing ACP countries secure a share of the rum market commensurate with the needs of their economic development,

G. considering the importance of the rum trade with the EU to the economies of the ACP rum producing States and the contribution of the rum industry to foreign exchange earnings, employment and hence to the socio-economic development and political stability of the States concerned,

H. considering that the white spirits agreement initiated during the first WTO Ministerial Conference and the subsequent EU/US Memorandum of Understanding of March 1997 for the elimination of duties on certain spiritous beverages eroded the ACP preferences in rum trade and exposed them to competition from third country suppliers, over 80 % of which are subsidised,

I. noting however the EU Declaration of 24 March 1997 to the effect that the EU/US Memorandum of Understanding will not change in anyway the terms of access enjoyed by ACP rum exports to the Community market in the framework of the Lomé Convention, and do not prejudge the future of the regime after the Convention expires in 2000,

J. noting that the ACP have intensified their promotion campaign to develop a market for the higher quality branded rums and would require the continuation of the current Lomé IV preferences for an extended period, so as to enable them to compete in a tariff free market with rums from other regions,

K. considering that as a result of the March 1997 EU/US Memorandum of Understanding which exposed ACP rums to increased competition from subsidised brands on their traditional markets, it is imperative that corrective action be taken prior to February 2000 if ACP rum industries are to survive,

1. Calls on the Community and its Member States to:

(i) fully honour their commitments under Protocol 6 on Rum in the Fourth Lomé Convention, including the commitment under the mid-term review, and extend the preferences beyond 2000 to permit the ACP to develop their traditional trade flows with the EU to its full potential;

(ii) ensure that the interest of ACP rum producers are fully defended in the forthcoming review of the WTO Agreements;

(iii) ensure that, as stated in the Declaration of 24 March 1997 given in the context of the EU/US Memorandum of Understanding, the terms of access for ACP rum exports are not adversely affected and their competitive position in the market is maintained;

(iv) index for inflation the pricing mechanism of the EU/US Memorandum of Understanding retaining the tariffs on low-priced rum and EU duties on non-ACP rum, thereby safeguarding the ACP against competition from third country suppliers of subsidised brands;

(v) ensure that appropriate arrangements are made prior to the expiry of the Lomé IV Convention to ensure that ACP rums maintain their share of the EU market and their preferences are not further eroded;

(vi) ensure that the GATT compatible pricing mechanism, which retains tariffs on low-priced rum from non ACP countries, is maintained and not traded away in any future GATT/WTO rounds of tariff reductions;

(vii) maintain strict enforcement, without derogations, of EU rules limiting commercial use of the term "rum" as described in Article 4 of Council Regulation (EC) No 1576/89;

2. Instructs its Co-Presidents to forward this resolution to the ACP-EU Council and the Commission.

(1) Adopted by the ACP-EU Joint Assembly on 1 April 1999 in Strasbourg (France).