WRITTEN QUESTION E-2786/02

by Ulla Sandbæk (EDD) to the Commission

(3 October 2002)

Subject: Sugar

1. Would the Commission provide a detailed assessment of the impact on trade flows from LDCs to the EU in the areas where tariffs were reduced under the Everything But Arms Initiative. The assessment should include trade flows one year before and at least one year after implementation of the Everything But Arms Initiative started. Finally, would the Commission state whether the impact on LDC trade flows is considered satisfactory?

2. Would the Commission provide a detailed assessment of the impact on sugar trade flows from LDCs to the EU since LDCs were given quota-restricted access over a transitional period as part of the Everything But Arms Initiative. The assessment should include trade flows one year before and at least one year after implementation of the Everything But Arms Initiative started?

3. Would the Commission give a general assessment of the economic benefits for the LDCs as a consequence of the implementation of the Everything But Arms Initiative?.

4. How will the Commission address questions of rules of origin, safeguard measures and supply side constraints on LDC production and export capacities in the Everything But Arms Initiative?

5. Would the Commission give an overview of the measures being implemented to improve administrative procedures regarding LDC exports, in particular in the area of value-added food products?

Joint answerto Written Questions E-2786/02 and E-2879/02given by Mr Lamy on behalf of the Commission

(12 November 2002)

The Everything but arms Initiative (EBA) was adopted, in February 2001, as an amendment to the Generalised Scheme of Tariff Preferences (GSP) Regulation(1) in force at that time. Prior to EBA, the GSP Regulation already provided special arrangements for least-developed countries (LDCs) under which they enjoyed virtually the same preferences as under the Cotonou agreement.

By granting duty and quota free access for all products (except arms), EBA fully liberalised with immediate effect a total of 1 073 tariff lines. All these tariff lines are agricultural products, except 19, which refer to industrial products. However, EBA did not immediately liberalise imports of sugar, rice, and bananas. This concerns a total number of 43 tariff lines, for which EBA provides duty free quotas during the transition period.

The Commission is sending direct to the Honourable Member and to the Parliament's Secretariat a table containing the information requested.

As 2001 figures for preferential imports under EBA have only been available since September 2002 and as two years at least are necessary to objectively assess the impact of the EBA initiative, it is too early to carry out an assessment of the impact on trade flows from LDCs to the Union.

EBA offers real opportunities for LDCs to increase exports to the Union, but work needs to be done to ensure that these opportunities are realized. This is why a comprehensive approach to trade and development, as set out in the Commission Communication on Trade and Development(2) is required.

The quota of 74 185 tonnes for the first year of EBA (marketing year 2001/2002) was fully utilised. Seven LDCs participated in the scheme, of which Ethiopia, Sudan, Mozambique and Burkina Faso all exported to the Union for the first time. Tanzania, Zambia and Malawi already exported sugar to the Union in the context of the Sugar Protocol and Special Preferential Sugar quantities but benefitted from increased overall quantities. It is too early to say how the 2002/2003 quota will be used but the same countries, plus Nepal, have applied to access it.

Questions of rules of origin and safeguard measures relating to EBA are addressed in the framework of the Generalised System of Preferences (GSP) which will be reviewed in 2004 including specific safeguard and monitoring provisions for EBA.

The issue of how developing countries, including the least developed, can benefit from increased market access and trade can only be tackled in a comprehensive framework. The Commission approach to this subject has just been set out in the Communication on Trade and Development, and is exemplified in the approach of the Economic Partnership Agreements (EPAs) with the African, Caribbean and Pacific (ACP) states.

The need for developing countries, LDCs in particular, to have more effective market access is fully recognised in the Communication on Trade and Development. The Communication also sets out some of the measures being taken to address non-tariff barriers which would include administrative barriers. With regards to ACP LDCs, a central objective of the Economic Partnership Agreement (EPA) mandate is to simplify all requirements and procedures related to imports and exports, in particular with regard to customs processes, import licensing, customs valuation, transit rules and pre-shipment inspection. Co-operation will go far beyond administrative procedures. By extending ACP-Union co-operation to all areas relevant to trade, EPAs will help to strengthen the capacity of ACP countries, LDC and non LDC, to deal with these issues.

(1) Council Regulation (EC) No 2820/98 of 21 December 1998 applying a multiannual scheme of generalised tariff preferences for the period 1 July 1999 to 31 December 2001, OJ L 357 van 30.12.1998.

(2) COM(2002) 513 final.