I welcome the Independent Member Deputy Maureen O'Sullivan who is attending her first meeting of the select committee.
Economic Partnership Agreements: Motion
I thank the Chairman.
I also join in that welcome.
Deputy O'Hanlon also joins in it. I am sure it is unanimous.
I ask all members to ensure their mobile phones are switched off completely for the duration of the meeting because, even in silent mode, they interfere with the recording equipment. I also remind them that immediately following this discussion, the select committee will consider the Revised Estimates for 2010 — Votes 28 and 29 — for the Department of Foreign Affairs. It will now consider the following motion referred to it by Dáil Éireann——
Before you proceed, I do not have a difficulty with the times allocated in the second part of the meeting when we will deal with the Revised Estimates. However, I cannot guarantee that we will be able to finish the first part of the meeting by 4.15 p.m. and would prefer to give you notice now.
We will see how we proceed in the meantime.
The motion reads:
That Dáil Éireann approves the terms of the three interim Economic Partnership Agreements:
(1) Interim agreement with a view to an Economic Partnership Agreement between the European Community and its Members States, of the one part, and the Southern African Development Community Economic Partnership Agreement States, of the other part;
(2) Interim agreement establishing a framework for an Economic Partnership Agreement between the European Community and its Member States, of the one part, and the East African Community Partner States, of the other part; and
(3) Interim agreement establishing a framework for an Economic Partnership Agreement between the Eastern and Southern African States, of the one part, and the European Community and its Member States, of the other part,
which were laid before Dáil Éireann on 12 April 2010.
On behalf of the select committee, I welcome the Minister of State, Deputy Power, and his officials, Mr. Brendan Rogers, Mr. Michael Gaffey and Ms Mary Barrett. Following the Minister of State's introduction, committee members will be invited to speak on the motion. Is that agreed? Agreed.
I, too, join in the Chairman's welcome of Deputy Maureen O'Sullivan as a new member of the select committee.
I am very happy to have the opportunity to meet the select committee to discuss the motion which has been proposed by the Minister for Foreign Affairs. It asks Dáil Éireann to approve three interim economic partnership agreements between the European Community and its member states with Southern African Development Community states, the East African Community partner states and eastern and southern African states.
I am grateful to the Chairman and members of the committee for facilitating discussion of the motion. The reason I seek their approval and that of Dáil Éireann without delay is that the European Commission and all other EU member states have already signed two of the agreements at official ceremonies. All other EU member states have signed all three agreements at this stage. I would like to set out the context in which it is necessary to bring these and other economic partnership agreements before the committee, as there has been much commentary on these agreements, some informed but some not.
Historically, African, Caribbean and Pacific, ACP, countries benefited from unilateral trade preferences with the European Union. However, many other developing countries did not. Accordingly, these unilateral trade preferences were deemed to violate World Trade Organisation rules on the basis that they established unfair discrimination between developing countries. Developing countries not part of the ACP group did not have such preferential access to the EU market, thus creating an imbalance in the global trading system among developing countries. To overcome this, in 2000 the European Union and the 77 ACP states concluded a legally binding agreement known as the Cotonou Agreement which provided for a new trade and development framework based on economic partnership agreements, a new type of multilateral agreement combining both trade and wider development issues in a unified framework and containing reciprocal preferences in trade between the European Union and the ACP states. On this basis, in 2001 the WTO agreed to give a waiver to the European Union to continue the unilateral preference system until 31 December 2007. The original intention was for the European Union to conclude comprehensive economic partnership agreements with the six regional groupings of ACP states.
Following protracted and difficult negotiations, only one of the regional groupings, the Caribbean grouping, was in a position to initial a full economic partnership agreement before the December 2007 deadline. Twenty-one other African, Caribbean and Pacific countries initialled interim agreements in smaller sub-groups or individually. A positive aspect is that this meant trade disruption was avoided after that date. All of the agreements provide for full duty and quota free market access on the EU side and a flexible and asymmetric liberalisation schedule on the ACP side. The interim agreements which define much of the framework for negotiations will act as building blocks to full economic partnership agreements with the remaining ACP regions. Negotiations towards full economic partnership agreements are ongoing, with most progress being made in west Africa where it is hoped a regional agreement on trade in goods and development co-operation will be concluded this year.
Turning to the agreements before the committee, the agreement with Southern African Development Community states was signed by Botswana, Lesotho — an Irish programme country — and Swaziland on 4 June 2009 and by Mozambique — another Irish programme country — on 15 June in the same year. Namibia is considering its position on signature. That is a significant point to make, as our own programme countries have signalled to us their willingness to enter into these agreements.
The agreement with eastern and southern African states was signed on 29 August 2009 by Madagascar, Mauritius, the Seychelles and Zimbabwe. Zambia and Comoros indicated that they would sign at a later date.
The negotiations with the East African Community on a comprehensive economic partnership agreement have been accelerated with a view to reaching agreement by mid-November. I met the Kenyan Minister for Forestry and Wildlife, Noah Wekesa, last week and he signalled a desire to reach a comprehensive agreement. The EU trade Commissioner Karel De Gucht has indicated that he will do his utmost to maintain applied tariffs in the interim provided that both parties conduct the negotiations in good faith.
Members will recall that I presented to the committee on 17 December 2008 on the issue of economic partnership agreements. On that occasion I was seeking approval for three interim agreements with Cameroon, Ghana and the Ivory Coast. Following approval by Dáil Éireann, these agreements were signed by Ireland on 18 December 2008. The countries concerned are now engaged in negotiations towards reaching full regional agreements, with most progress being made in west Africa which includes Ghana and the Ivory Coast. I understand the negotiations are going well.
The three interim agreements before the committee are very similar to those approved in December 2008. They combine trade and development issues. Increased trade is central to sustained economic growth in developing countries. Trade, not just aid, is needed if poorer countries are to escape from abject poverty. The three interim agreements aim to remove barriers to trade between the European Union and the countries involved progressively. They also aim to enhance co-operation in areas related to trade. They seek to provide an open, transparent and predictable framework for goods to circulate freely. The aim is to increase the competitiveness of the African countries concerned. At the opening of the third EU-Africa Business Forum in Nairobi last September, Erastus Mwencha, deputy chairperson of the African Union, noted that businesses needed predictability, stability and an efficient regulatory infrastructure to thrive. In his view economic partnership agreements should further contribute to the establishment of a predictable trade and investment climate in Africa.
The three agreements being discussed involve what is called "mixed competence". They deal with issues, some of which fall within the exclusive competence of the European Union — trade relations being the primary example — and some of which remain within the competence of the individual member states of the Union. A prime example of the latter is development co-operation with member states. Where EU agreements with third countries involving mixed competence arise, they are negotiated, on behalf of the European Union and the member states, by the European Commission with the third countries concerned. They are then signed on behalf of the Union and the member states. Before they can formally enter into force, they are ratified by all parties, including the individual member states.
I will clarify the African countries which are parties to the agreements. The first interim agreement is with Southern African Development Community states, comprising Botswana, Lesotho, Mozambique, Namibia and Swaziland. Lesotho and Mozmabique are Irish Aid programme countries. The second interim agreement is with the East African Community, the regional intergovernmental organisation of Burundi, Kenya, Rwanda, Tanzania and Uganda. The last two countries mentioned are also Irish Aid programme countries. The third interim agreement is with eastern and southern African states, comprising six members of the Common Market for Eastern and Southern Africa, known as COMESA, namely, Comoros, Madagascar, Mauritius, the Seychelles, Zambia and Zimbabwe.
I will briefly outline the contents of the agreements. They provide full duty and quota free market access on the EU side. For the countries involved, this means no EU duties or quotas for any products other than arms and a transition period for sugar until 2015. It also means long-term security for traders and investors, with no more waivers, time limits or periodic renewals. Unlike the system they replace, the agreements meet WTO rules; as such, they are safe from legal challenge from those countries which are not members of the 77 nations comprising the ACP group. They also provide flexible and asymmetric liberalisation schedules. Asymmetric in this context means that the ACP countries do not have to liberalise their import regime as much or as fast as the European Union. These arrangements will comply with Article XXIV of the-General Agreement on Tariffs and Trade, the agreement which led to the WTO.
While the European Union has given full duty and quota free access to ACP goods, ACP countries have been allowed to exclude certain agricultural products, for example, wheat flour, as well as non-agricultural processed goods, for example, footwear, from liberalisation. In deciding on specific exclusions each ACP country focused on protecting certain existing industries or infant industry and maintaining fiscal revenues. With regard to liberalisation schedules, I highlight the development co-operation provisions in each of the interim agreements, whereby the European Union will co-operate and provide development assistance for the ACP countries involved to build trade capacity, for example, to support local industry, and address adjustments, for example, decreased government income from duties on liberalised imports, involved for the three groups of countries.
The development co-operation provisions also seek to support the other elements of the agreements which will facilitate trade expansion in the African countries concerned. They include provisions on customs and trade facilitation, as well as animal and plant health measures in the Southern African Development Community interim economic partnership agreement. The agreements with the East African Community and eastern and southern African states each contain a chapter on fisheries to address the specific interests of these two groups of countries.
I now turn to the issue of aid for trade. It is clear that if the African countries concerned are to take full advantage of the trading opportunities afforded by the interim economic partnership agreements, greater and more effective trade-related assistance should be made available to them. In 2005 the European Union pledged to increase collective Commission and member state expenditure in this area to €2 billion per annum by this year. I am pleased that we are on target in this regard. A large share of this increased expenditure is being devoted to the needs of ACP states. Ireland will continue to play its part in funding aid for trade initiatives in the coming years. It is increasingly my view, as I continue my term as Minister of State with responsibility for overseas aid and development, that development co-operation alone will never relieve Africa or countries in the developing world from endemic poverty or hunger. Development co-operation plays a catalytic role in allowing developing countries to engage in the new, globalised world of trading infrastructure. In the same way that Ireland developed hugely as a result of our engagement with the European Common Market, as it was in 1973, these agreements will provide that type of framework for African countries to engage fully in a globalised trading economic system.
From our experience of the European Union, we know that regional integration is a key driver of peace, stability and development. It facilitates efficiency gains through enlarged markets and increased competitiveness. The European Union is actively supporting regional integration in Africa. Last March it granted four regional organisations in the eastern and southern African and Indian Ocean region financing worth €118 million to support regional economic integration. An inter-regional co-ordination committee, including the Common Market for Eastern and Southern Africa, the East African Community, the Southern African Development Community and the European Commission, will facilitate the proper formulation, implementation and monitoring of EU-funded regional programmes in the region. The interim agreement with the East African Community was formulated on the basis of the East African Community customs union and its regional integration plans. A co-ordinated trade regime with the European Union holds the potential to further strengthen regional integration in the East African Community.
On the other hand, concerns have been expressed about possible negative impacts on regional integration where some members of regional groupings have opted not to sign an economic partnership agreement. The Southern African Development Community interim agreement has attracted most attention. Botswana, Lesotho and Swaziland which have signed it are members of the world's oldest customs union — the Southern African Customs Union. Their fellow members, Namibia and South Africa, have not signed the interim agreement.
The efforts of the former EU Trade Commissioner and now High Representative, Catherine Ashton, on this issue should be acknowledged. She recognised the concerns on this and other issues in the interim agreement, travelled to the region and met the trade Ministers of the Southern African Development Community. This resulted in the addition to the interim agreement of a joint declaration which allowed for necessary technical adjustments to be made in order to align tariffs and avoid potential disruption to the smooth functioning of the customs union. The new Trade Commissioner, Karel De Gucht, followed up on this by bringing forward a proposal for a Council decision to allow for this alignment of tariffs. This was agreed by the Council on 3 June.
I am heartened by the fact that last January at the special Southern African Customs Union Council of Ministers' meeting in Johannesburg member states agreed a harmonised negotiating message on economic partnership agreements. Commissioner De Gucht met in April with eastern and southern African Ministers, adding impetus to the negotiations to achieve a full regional agreement.
I am aware that members of this committee are watching the economic partnership agreement process carefully. The next step is that these interim agreements will act as building blocks to full regional EPAs, which are significant agreements in their own right. This is already the case with the Caribbean group, CARIFORUM. It signed a full comprehensive agreement in July 2008. The inaugural meeting of the joint council formed under this agreement was successfully held last month in Madrid.
The EU and the west Africa region are planning to conclude a regional agreement on trade in goods and development co-operation this year. I take this opportunity to assure committee members that I have acted on their concerns, for example, the need for flexibility in the negotiations, and those expressed by non-governmental organisations regarding some aspects of ongoing negotiations towards full economic partnership agreements. The engagement by members of this committee and civil society has been extremely constructive and helpful to Irish Aid in our engagement with European Commission officials in this respect.
I heard these concerns expressed clearly at the stimulating debate on the agreements organised by the Irish section of the Association of European Parliamentarians for Africa in the Oireachtas in April of last year. I also met members of Trade Matters, the Irish network of non-governmental organisations engaged in advocacy for global trade justice yesterday to hear their views on these agreements and I very much welcome their engagement in this process. At EU Council meetings, I have consistently raised this issue and called for full use to be made of the flexibility permissible under current WTO law to reflect the different development levels and needs of the African, Caribbean and Pacific countries and regions in the ongoing negotiations.
I also liaise closely with other member states to present a co-ordinated position at relevant EU fora. In March, we hosted a meeting of the EU like-minded group on economic partnership agreements at officials' level in Limerick, the headquarters of Irish Aid. This meeting considered recent reports on EPAs, discussed draft EU Council conclusions on the west Africa EPA development programme and allowed for ongoing co-ordination of shared positions on EPAs in the context of liaison with the Spanish Presidency of the EU.
I emphasise the importance of adopting these interim economic partnership agreements from the perspective of these three groups of African countries. They provide them with an open and transparent trade framework for their traders and investors — compliant with the WTO and thus safe from legal challenge from non-ACP countries.
I thank the committee for its time and I hope it will be able to recommend to Dáil Éireann that the motion proposed be approved. I will be happy to take any question.
Thank you. I acknowledge the briefing material which has been circulated to members from Dóchas and Trócaire's Mr. Alan Whelan concerning the subject matter of this meeting. We are grateful for this information and it certainly has been helpful to the members. As the Fine Gael spokesperson is obviously away on other duties, we will proceed with the Labour spokesman on foreign affairs.
Everything I have to say this afternoon is by way of being of assistance to Ireland's development policy, however this is a terrible way to deal with an important issue. The Minister of State, in his speech, referred to the three previous agreements that went through this process on 17 December 2008. One will recall my concerns expressed at that stage at the manner in which these agreements were being processed. Unfortunately, little has changed.
The Official Report of 25 May last will show that, once again, I raised the issue where the suggestion was that they not be subjected initially to plenary discussion but referred to a select committee. The Taoiseach, handling the Order of Business, gave me an assurance. He made a number of points. First, he stated:
We are asked to approve the terms of the interim agreements as soon as possible. All other member states have signed them and the European Community is anxious to implement them in order to ensure compliance with World Trade Organisation rulings.
There are problems with that statement for a start because I understand the European Parliament has not discussed these agreements and processed them, although I may be wrong.
More importantly, the Taoiseach stated:
It is expected that this will be dealt with by the Select Committee on Foreign Affairs. We have been asked to put the agreements forward for approval.
I can undertake that the matters can be debated in the House when they have been dealt with at committee.
Yet, the schedule for tomorrow suggests that these three agreements are to go through the Dáil without debate. Even between last week and this week, that is what is printed on the schedule. Originally, on the first version of the schedule for this week, it was suggested that they were to go through without debate today, in other words, that they would go through in the morning before the select committee discussed them in the afternoon. They are now listed to go through without debate tomorrow morning. I will be in the Dáil tomorrow morning raising the issue of the Taoiseach's undertaking of 25 May last and the fact that it has been broken. There are issues of transparency.
I do not disagree on the fundamental necessity of helping Africa but this is also a wrong way to discuss the intersection of trade and development issues. The Minister of State has gone into what is accurate and what is inaccurate. I do not want to get too delayed on that but it would be useful for other members of the committee to know the distinction between what has been signed, what has been initialled and what is required to be informed to the WTO. For example, under the Article XXIV arrangements, an initialled agreement can be informed to the WTO, and that in itself would satisfy the WTO requirements legally. This notion that they must be passed and rammed through is nonsense.
It is also true to say that in the general frame of the matter of trade with Africa anyway, and the WTO, there are other mechanisms entirely, apart altogether from this process that has gone on from 2002, through 2007, to today, for example, the waiver mechanism. I can go into this on another day because it is high time we had discussions about how our development initiatives are being contradicted by unaccountable non-transparent processes.
Members referred to Baroness Ashton. I remember Baroness Ashton's intervention because it took place before December 2008 and was very helpful. However, there is a contradiction in the position that her successor has taken. He has not adopted the same position in the negotiations.
In so far as we want to deal with accuracy, there was a meeting in Dar es Salaam between 7 and 9 June last and a press release issued, which, by the way, includes a note signed by the existing Commissioner, suggests that he is disappointed that he has not been able to bring the EAC agreement to a conclusion. If that is the case, the chair, Dr. Mary Nagu, Tanzania's Minister of Industry, Trade and Marketing, on behalf of her particular delegation, in the joint signed press release issued, announced that they do not want the agreement signed at this time until fundamental issues have been agreed. I will turn to those issues in a moment.
Therefore, it is impertinent, nonsense and extremely unworthy of a parliamentary process to suggest that somehow or other Ireland will hold something up if it does not sign these agreements. As far as I am concerned, I am happy to co-operate in a discussion of what is an appropriate relationship between the European Union and these three different groups.
I offer another observation en passant. Why is the committee taking the three together in one motion? The Minister of State might answer that. The text of the three is different. There are different stages of adoption. For example, some have been discussed in issues, some have been discussed and signed, and some members affected by some of them have had bilateral agreements. They are simply not compositionally the same. It would have been interesting, for example, to take the three agreements one after the other. We could then have three separate discussions rather than dealing with a single motion. However, what is on offer in a country that has an admirable record in providing development assistance for and co-operation with countries on the African continent is that the three agreements should be rushed through the Dáil tomorrow as some form of bureaucratic concession. This matter will not be dealt with in plenary session of the House. The Order Paper states the motion will be taken without debate. There will be no debate, unless we succeed in having the Order of Business amended tomorrow morning.
The Minister of State seemed to advert to different outcomes in respect of the three agreements. It would be much better if he acknowledged that the differences in content and outcome reveal what might be termed different ranges of asymmetric power in negotiation. Those with the least negotiating power have obtained the worst deal.
We are not being provided with the full truth on many aspects of this matter. Which bodies in Africa have been consulted about the agreements? Will the Minister of State indicate the bodies that have been consulted? Will he also indicate those which have agreed to, initialled or signed them and those which have expressed reservations? Is there any information on the reservations which are considered most important?
In the context of tariffs, matters very much revolve around what the countries concerned can obtain in respect of exports to the European Union. What is the position on the requirement that a country must eliminate 80% of its tariffs within a specific timescale? Did any of the African countries express views or reservations about this? The Minister of State might reply by stating we will take the classic, unaccountable and bureaucratic route by initialling or signing the agreements and that the matters to which I refer will be dealt with later.
At the meeting held in Dar es Salaam between 7 and 9 June a hope was expressed that matters could be resolved by November this year. However, the issues have not been resolved. At one of its recent meetings the committee was informed about the rape of the African continent by multinational corporations which engaged in the practice of declaring artificial losses in order to avoid paying tax. This occurred at the same time as we were lecturing African countries on how, as a mark of their development, they would be obliged to invent measures to raise tax. The ability to impose new and additional charges on extractive industries is limited by the agreements before the committee. That is another reason I intend to press the matter to a vote before the committee concludes its deliberations.
There is an interesting contradiction in the way in which the Houses are dealing with the agreements. It is not merely the case that the process by which they are being discussed in the Dáil and at the committee is defective. What is happening is that we are being given a trade rather than a development presentation. With the greatest of respect, everything relating to the existing economic model has changed in the past couple of years. Once again, countries in Africa are contemplating freedom from hunger, sufficiency in food production and changes with regard to land tenure. A new form of economics is being discussed, but what is being imposed is the worst detritus of an old, failed economic model. There is dishonesty to some extent regarding suggestions as to what is required by the WTO. Significant achievements have been made by countries in what arose during the Doha Round. I refer to the Singapore issues which are resurfacing in the agreements we are discussing. There is an opening, in respect of which people can advance issues relating to the real gains made by African countries at different fora.
Lest there are those who believe I am making all this up, two individuals, in a very calm manner, have asked that we not sign the agreements. They are supported by a number of NGOs which argue that we should not sign until the fundamental issues are resolved. Among those opposed to the agreements being signed are the former President of Tanzania and the current President of Malawi. I choose to be influenced by the request they have made. I would like the committee to be informed that development issues will take precedence over the unaccountable, bureaucratic, non-transparent issues developed by the European Union and that the latter will be resiled from. There has been a significant change since Baroness Ashton negotiated on the economic partnership agreements. If the Minister of State wishes, we can engage in a detailed discussion on that matter at some stage.
On the Southern African Development Community, SADC, a Southern African Customs Union, SACU, meeting is scheduled to take place on 18 June. Will the Minister of State indicate why Ireland is rushing through these three interim agreements tomorrow prior to that meeting taking place? It is almost a case that the sky will fall, hens will not lay eggs and everything will stop if the agreements are not approved by the Dáil. That is not true and that is not how the WTO process works. Anything initialled must be conveyed to the WTO and, therefore, all that we have here is a bottle of smoke. As stated, it is in the eastern and southern African region that the asymmetric balance relating to the power of negotiation is most manifest and there is a similar situation in respect of countries which have not signed. If they do eventually sign, would it not be extremely valuable for us to know what progress we are making, the nature of their original reservations, the tenor of the European Union response and exactly what Ireland asked of the latter?
Not only have the three interim agreements been bundled together, they are also being dealt with by a select committee of the Dáil. I would have liked the Seanad to have had the opportunity to discuss them. Perhaps the Minister of State will indicate if there is a constitutional lock in that regard. In addition, I would have liked the matter to have been debated during a plenary sitting of the Dáil in order that we might have discussed these matters in a substantial fashion. I understood I had been promised such a plenary debate last December when the Minister of State previously came before the committee. We will discover the outcome tomorrow morning when I will oppose the Order of Business in the Dáil.
The Minister of State made an interesting reference to the pious aim that we were moving via interim economic partnership agreements to full regional agreements. Statements from Namibia and South Africa indicate that we are moving in precisely the opposite direction. Some countries have signed, while others within the SACU have not done so. The net effect of proceeding with a divide and conquer strategy at Commission level is destructive of the possibility of there being a regional accommodation. Anyone who knows anything about the African countries to which I refer will be aware that perhaps the most difficult thing to achieve — it is, however, the most important aspect with regard to sufficiency in food production and trade and future developments — is encouraging the emergence of intra-regional mechanisms. Such mechanisms are not assisted by the interim agreements.
Having carefully analysed what was said by those on the African side who expressed reservations at the negotiations, I agree with them. We would gain enormously from an open discussion on why the agreements are so contentious. The Minister of State is well aware of how the atmosphere has changed in recent weeks. The Dar es Salaam meeting was exceptional and the meeting on 18 June is also likely to be so. Why then not swim with the tide of African consciousness in terms of what is required?
Ambassador Nathan Irumba, executive director of the Southern and Eastern African Trade, Information and Negotiations Institute, SEATINI, an independent body, has argued that there is no need for the East African Community to be hurried into an agreement without a resolution of major issues of concern. My stance on the matter is similar. I want the truth to emerge in respect of what has been signed, initialled or reserved and the additional details sought by the African side. However, I am being asked to approve the agreements in the absence of a full debate in a plenary session of the Dáil. If the Minister of State says I am wrong, perhaps he is saying I have very few rights. The European Commission can decide a particular position; the Commissioner can go to meetings in Africa and say we are wearing them down and so forth, and we just rubber-stamp everything. That is not on. The Chairman has correctly made reference to the submissions made to the committee by Trócaire and all the other bodies.
At the Dar es Salaam meeting I mentioned between 7 and 9 June 16 significant organisations from the civil society sector in Africa also called on their government representatives to delay signing until the fundamental issues had been discussed. A meeting of these organisations took place in Kampala, Uganda, and a number of issues were raised. I made a suggestion about the volume of trade that has to be made totally liberal within a period of time. I have to contest the Minister of State's assertion that concessions have been made regarding infant industries. As I read the text, if one is producing chickens in some of the countries concerned and wants to defend oneself against a tide of frozen chicken from the European Union, one would begin to think about what are the opportunities and the detail. I will be more than happy if I am entirely wrong.
I refer to aid for trade. The everything but arms agreement is in place, as are other valuable agreements. If the Minister of State is rushing this, the onus is on him to demonstrate the additionality by way of benefits for the signatory countries or the other side. If all of this stopped tomorrow morning, everything was delayed and we could not reach a solution, not much would be different because if one examines the everything but arms agreement, it could be tweaked and one could achieve everything the Minister of State outlined in his contribution without it. One could then move to another agreement. When he moves himself to a high point about the great success achieved in the Caribbean, an area I know, the countries concerned have had a particular interest in a relationship with the European Union in the implementation of an agreement, for example, on the rum industry. They borrowed money to lever EU funds and they borrowed until 1 September only to find the Commission pulled the plug on 1 March leaving them, particularly those countries involved in the rum industry, with money borrowed for six months that will lever nothing. Therefore, it will be destructive in its implications.
There are other important examples. I support Irish Aid which is being dragged into this trade strategy. I acknowledge it has been of assistance in dealing with the issue of asymmetrical negotiation, which is valuable. However, accountability in the European Union's development strategy is at stake. It is allowing itself to be co-opted in a trade strategy which is being crafted within a failed model of economic development.
If all of the interim agreements lead to full agreements, it is almost Jesuitical to say that when all the interim economic partnership agreements are put side by side with bilateral agreements which will expand to become putative regional economic partnership agreements, everything in the world will be rosy. Some of the bilateral economic partnership agreements entirely contradict the direction in which potential regional negotiations are moving and it is a mess. I am not arguing an extreme position at this stage such that we should withdraw from this process altogether. but I propose a more modest ambition. We should allow for the African reservations to be voted on by Africans. When one takes the total community of African nations, how many are involved in economic partnership agreements? How many have initialled them? How many have deferred negotiations?
All of them.
With regard to the achievement of the millennium development goals, Ireland is attending a world evaluation meeting in September. I have asked the Minister for Foreign Affairs and the Minister of State what caucus meetings will be held with different groups before they attend the meeting in September. The content, process and atmosphere of the EPA negotiations are singularly unhelpful to the achievement of solidarity we might want to build ahead of the September meeting at the United Nations.
I thank the Minister of State for his contribution. I support the signing of the agreements which are based on reciprocal trade preferences between the European Union and the ACP states. They aim to contribute to poverty reduction and eradication and the gradual integration of EPA states into the world economy. Under the Cotonou Agreement, all of the countries concerned are fully engaged in negotiating full economic partnership agreements and the interim agreements allow more time to reach a fairer deal.
The Minister of State referred to the development of international trade by the countries involved. That is the best way to eradicate poverty in the medium term. People in these countries who have the capacity and ability to create initiatives to establish industries and services do not have the finance to do so. What is being done to provide finance for them in order that they can create their own trade links?
Ireland has been to the forefront in the European Union in pressing the Commission to ensure development needs underpin all elements of the agreements. Is the Minister of State satisfied that this will happen? Why have South Africa and Namibia not signed the agreements?
I understand the concern of Deputy Higgins about what is debated by the committee and in full plenary sessions of the Dáil. The Deputy will not mind me saying that if this was debated in full plenary session he might not have got as long to contribute. There are very strict limits in the House.
That is their problem.
It is thanks to the Chairman here that the Deputy has had the opportunity to contribute for longer. In this instance it was the decision of the plenary session of the Dáil that we would discuss this issue here today. I take his point that we should investigate under Standing Orders discussion of Dáil reform or discussion with the Whips, what might be more appropriate to discuss in the Dáil and what might be better discussed in committees. In this instance we are tied by a decision of the Dáil, which requested us to deal with this issue on this occasion.
I thank the Chairman and members of the committee for the welcome to the committee. I now know what it means to be thrown in at the deep end. I feel this is a question of catching up. I welcome the idea that it is trade and not just aid. If there is to be any imbalance at all, it needs to be in favour of the African countries. My introduction to this topic has come from the extent of the criticism I have received from a variety of individuals and organisations. Some of these organisations are highly respectable and have been doing invaluable work not just from a bureaucratic point of view, but directly in Third World countries. I take on board that criticism because I have great regard for those organisations in which some of my past pupils now work.
Apart from the extent of the criticism an area of disquiet for me is that some African countries have not yet signed. It would appear that we are being rushed into signing, which I do not understand. There are problematic clauses from the African point of view. Some of these organisations state categorically that there could be worsening of the situation and that it could be detrimental to the poorer countries.
I understand that Namibia has got major changes to the EPA, but I understand they are not included in the agreement and I wonder why. If there is a reciprocal agreement, it will favour the EU over Africa. I would also like addressed the African Union reservations that there are major areas of divergence. I understand some of our respectable and long-established organisations believe this will not be free trade at all and will certainly not be fair trade. It will again further result in European domination of African markets. I was a history teacher and so I know what imperialism has done to Africa and the extent of the damage we have caused to date. I would not like to think we would contribute to that further.
I do not like the idea that the EU is insisting on concessions from African so-called partners. How can it be a partnership if one party is insisting on concessions? It could undermine the regional development and creation of an African common market. Whatever agreements are reached must strengthen developing countries' domestic markets so that they are totally self-reliant for food.
The Minister of State said: "The agreements also provide flexible and asymmetric liberalisation schedules." He explained these to some extent. He went on to say: "Asymmetric in this context means that the ACP countries do not have to liberalise their import regime as much or as fast as the EU." He gave some explanation of that, but it would seem to be a particularly critical aspect about which people would be very concerned.
It has not met the objective.
No.
I will certainly deal with that.
There was originally difficulty in getting staff to move to the Limerick office. It was subsequently staffed. Within the Limerick office, what is the level of competence in the countries being dealt with? To what extent is the expertise still based in Dublin? The Minister of State knows of the issue which has been raised in the past.
When the Minister of State is finished, we will have a five to ten minute break and will go into that so we can have the answer. The representatives of Irish Aid will stay for that.
Fine Gael Members are a little distracted today.
In that case perhaps the Minister of State might be able to answer it.
I welcome this healthy debate. The irony is that to my knowledge this is the only debate taking place among parliamentarians in the European Union about economic partnership agreements. Ireland is the only country engaging in this very robust strong debate. It does not matter greatly to me whether that takes place in the Dáil Chamber or in this room. The fact is that we are engaging in the real detail of these complex agreements. Our parliamentarians who have a real interest and specialty in this area are discussing the matter. It has not happened across Europe.
This is the only way to have this kind of engagement which is not possible in the Dáil with set-piece type speeches. That said, I respect Deputy Higgins's interest in this area. While we differ in many aspects, his comments on the floor of the Dáil have certainly been picked up and we have communicated those directly to the Commission. It is not a voiceless engagement on the floor of the Dáil. We are certainly informed by the contributions made here, and my engagement with civil society and advocacy groups has certainly informed our position. Ireland is part of a like-minded group that is taking a strong view within the European Union on economic partnership agreements generally. We support them which is why we are putting these motions before the committee today. We are adopting quite a strident approach to the flexibility in negotiations adopted by the European Union on the agreements.
At the heart of this discussion is a philosophical debate on how we need to engage with our African partners. That is why I went off script during my presentation. The more experience I get in dealing with African countries the more I believe that development co-operation by merely handing over substantial cheques or engaging in building up the capacity of development co-operation projects in African countries will never solve the problems of Africa. The only way to relieve Africa from poverty ultimately is to empower the countries in Africa to take part in the globalised world. While I know Deputy Higgins disagrees with that, however uncomfortable, it is the reality. We live in a globalised trading world, which is rules-based. The more that Africa engages with that globalised trading world the more it will benefit in the long run. We are talking about timeframes of 20, 30 or 40 years.
It happened before I was born, but not I suspect before Deputy Higgins was born. In 1959 this country signalled our intention to come out from our economic isolation on the western periphery of Europe and we subsequently engaged with an economic community, a Common Market, a rules-based trading system in 1973. Through those acts of Irish national sovereignty, we decided to engage in a multilateral trading system, the EEC, subsequently the European Community and now the European Union. That has benefited Ireland enormously over 30, 40 or 50 years.
I am not against global trade.
The Deputy was against it, in fact.
I am against market-driven asymmetrical trade.
The very arguments Deputy Higgins is promulgating now at this committee were promulgated by the Labour Party and others in 1973. I do not want to be party political about it. It was suggested at that time that Ireland would be flooded by international goods and that it would be the death of our economy. I accept that certain areas of our economy suffered. The overall philosophical macro-economic point I am making is that Ireland has benefited enormously, on the whole, by engaging in the inevitability of a globalised world trading structure. An analogy can be drawn with the current circumstances. We differ fundamentally on this.
There is nothing inevitable about our world.
I accept that the Deputy's criticism of the economic paradigm that has existed up to now is a strongly held belief that informs his position on these proposals. It is very different from the Government's position. Although engagement in trade is not the be all and end all, it is very important. We are bringing these motions before the committee because we are under a legal obligation to do so. As a member of the European Union, Ireland entered into the Cotonou Agreement in 2001. Some 77 African, Caribbean and Pacific countries signed up to the 2001 agreement to prevent the international trading system between the northern and southern hemispheres from falling into chaos. They agreed to try to stop such chaos from developing. We should bear in mind that the countries in question are not the only developing countries in the world. Many other developing countries do not enjoy the preferential treatment the African, Caribbean and Pacific countries get. They are being discriminated against. When the EU and the countries in question adopted the legally binding Cotonou Agreement, they agreed to move towards this moment in time.
That process should have been concluded by 2007, but that has not happened.
The Deputy asked if there is another way of doing it.
I did.
I am sure we could mention other possibilities, but we agreed to do it this way. That is why we have come to this moment. I would like to make a third point. I was wrong to say all of these agreements have been initialled, although most of them have. The ultimate act of national sovereignty is to sign interim agreements and subsequently negotiate full and comprehensive economic agreements. All of these countries are actively engaged in looking for fuller or more comprehensive agreements. It is a matter for each of these countries to sign these agreements, in its own wisdom or otherwise. We respect the sovereign right of the countries with which we deal to enter into these agreements, or not to do so. I do not buy into the conspiracy theory that there is a global imbalance of power, in terms of negotiating positions. I say that on the basis of my own experience — the Deputy may disagree. I was in Geneva in 2008 when an effort was made to bring the Doha development round to a conclusion. The 77 countries in question were very savvy, clued in and well able to negotiate.
That is why we must protect what they gained in Doha.
We have to move on and finalise the Doha Round.
Trade agreements are different.
I would like to deal with some of the detailed points made. I answered the question on whether there is another way of doing it. It was agreed in the Cotonou Agreement that it would be done in this way. I was also asked why all three agreements are being taken together. They are the same, in effect, as they serve to bring the provisions of the Cotonou Agreement to a conclusion. The discussion we are having is not about the exact or intricate detail of the agreements. The Deputy is opposed to them on the basis of economic and development theory, as he is entitled to be. I see no reason not have a general discussion on whether economic partnership agreements are good or bad. That answers the Deputy's question on this aspect of the matter.
He also suggested that we are not getting the full truth from the EU or from the negotiating positions. These multilateral trading agreements have been entered into by sovereign states and the European Union. We have to deal with the governments of those countries. It is right that strong and robust debates are taking place in those countries at civil society and NGO levels, as well as among advocacy groups, some of which are represented here today. Ultimately, the international system is based on international agreements between national governments. If a country's government signs one of these agreements, we have to accept that as an act or expression of national sovereignty. When I spoke at another event earlier today, I made the point that in 1990 there were three democratically elected governments in Africa, but now there are 30. While we may have issues with the nature of those elections, a strong progression has been made in a relatively short period, by any yardstick or measure. We have to deal with those democratically elected governments. I accept the various points the Deputy made about different elements within those countries which put forward advocacy positions, as is their right.
Deputy Higgins and I differ on the issue of intra-regional integration. I strongly believe that by entering into these agreements, engaging with these countries and bringing them into a globalised multilateral trading system, we are providing the building blocks for them to form regional groups. The Deputy disagrees with this. I am strongly of the view that as soon as the east African group concludes its full economic partnership agreement with the EU, in the fullness of time, that will provide the basis on which those countries can trade with each other and with the world. They will be able to build capacity at their ports and airports, including Nairobi Airport and Dar es Salaam Port. Ultimately, they have to engage in the world's trading systems. Some of them have the philosophical viewpoint that global trade is bad. Regardless of whether one shares that view, the reality is that global trade is taking place here and now. Those who do not engage in it will suffer. By entering into regional agreements, these countries can provide the building blocks for comprehensive economic agreements between regions and the EU, and subsequently as part of a world trading order. That provides the basis for their engagement in international trade, just as Ireland started to engage in it in 1973. At that time, people said foreign direct investment would destroy our country. They thought that to allow other countries to come in would destroy us. Now that we are able to trade in the world, we are begging, or actively looking, for foreign direct investment.
I also asked about the destruction of the capacity of these countries to raise revenue from their extractive industries.
In fairness, I agree with the Deputy on the taxation dimensions of that issue. The extent to which multinational extraction companies are involved in false invoicing across countries is being discussed at the moment. The introduction of a harmonised taxation system is essentially an issue for the G20. This is a very different issue. We are talking about preferential access to——
They have to retain their right to put taxes on extractive industries.
With respect, that is not really what we are dealing with. These are trading agreements, rather than double taxation agreements.
I know. That is about the corporation.
The Deputy made a point about chickens in Ghana.
I did. I do not have my notes in front of me, but if I remember rightly the problem relates to frozen west German chicken. I do not have the details to hand.
That point has been made not just in this forum but in many other forums, including academic and advocacy forums. When Ghana negotiated its economic partnership agreement with the EU, one of the first things it excluded was chicken production.
It is a bilateral agreement.
The Ghanaian authorities were entitled to do so because chicken production is of such fundamental importance to Ghana.
It is of importance not just to Ghana, but to many other African countries.
Yes. If one examines closely the safeguard mechanisms in Title III of the agreements——
I have.
——one will note that the mechanisms will apply into the future. If industries come under pressure or trade evolves in a manner which has a detrimental effect, under these agreements the countries in question reserve the right to opt out and introduce special safeguard mechanisms. Having studied these mechanisms in detail, I am satisfied that they are robust.
The process in which we are engaged is to enter into agreements which are compatible with the World Trade Organisation. There is no doubt that if we were not engaged in this process, non-ACP countries which are not part of the system and do not have preferential access to European countries would immediately bring cases to Geneva against countries which are part of the system. The fact that countries are engaged in this process means the WTO is providing some form of flexibility aimed at preventing such cases from being brought.
Is the Minister of State's position that the economic partnership agreements, EPAs, do not facilitate any Singapore issue?
No, what I am saying is——
The point is that certain things that were won at the Doha talks are coming in the back door. This has already occurred through the bilateral EPA.
Before addressing that issue, I wish to deal with the points raised by Deputy Maureen O'Sullivan. The Deputy has received representations and position papers from advocacy organisations. I welcome the role of such organisations which inform our national position. We must remember, however, that we are one country among 27. Positions change as a result of discussions such as this meeting and our discussions with advocacy groups, which have an important role to play.
Deputy O'Sullivan also referred to European domination of African markets. There is little trade between Europe and Africa as matters stand. European Commission officials will tell us that the Commission was not lobbied to any great extent by European trade organisations. It is not the case, for instance, that IBEC and European wide business representative organisations argued that these agreements are required to provide access to Africa. This is much more about addressing our obligations under the agreement entered into in 1991.
Deputy O'Hanlon also asked a question.
I asked the reason South Africa and Namibia have not signed economic partnership agreements.
South Africa and Namibia have decided not to enter into the agreements for sovereign reasons. Their decisions are another example of an expression of national sovereignty. In the case of South Africa, which is slightly different from other countries in that it is a middle income to developed country, in 2007 it initially participated as an observer in a supportive capacity but did not initial or sign the interim Southern African Development Community agreement due to disagreements over key provisions in the text. EU-South Africa trade continues to be covered by an existing trade agreement, the Trade Development and Co-operation Agreement. The European Commission can point to several concessions it made during the negotiations to try to address South African concerns.
As these are evolving processes, not all agreements are moving forward at the same time. We must remember — this relates to Deputy Michael D. Higgins's point on the Dar es Salaam meeting — that all these negotiations, letters and stated positions are taking place against a backdrop of ongoing and very detailed negotiations towards full economic partnership agreements. The agreements under discussion are interim agreements designed to overcome the difficulties caused by the unilateral trade preferences which Europe traditionally grants to the ACP countries. The backdrop to this is that negotiations on much more comprehensive agreements are taking place. Many countries are taking particular positions to try to influence the outcome of these agreements. We have an obligation under the Cotonou Agreement to enter into economic partnership agreements. Ultimately, however, it is a matter for the partner countries to enter into these agreements.
As Deputy Higgins correctly noted, the Caribbean countries, which have a stronger tradition of co-operation among themselves and a longstanding trading relationship with the European Union, did not have any difficultly entering into agreements within the timeframe.
The European Commission sold them short on the rum industry, for example.
I beg to differ with the Deputy. The agreement will, in the long run, benefit overall trade between the Caribbean countries and the European Union.
Will the Minister of State respond to the question asked by Deputy Noonan who may be called away from the meeting?
The position on decentralisation is that the process is ongoing. Given the nature of the Department, with people travelling to and from postings abroad, issues will arise on an ongoing basis. For instance, a question arises as to where staff returning from a posting should be stationed. There is an issue with the triangle of Dublin, Limerick and overseas and practical difficulties, especially among diplomatic staff, associated with returning from overseas and locating in Limerick, for example. These are human resource and personnel issues which are being addressed on an ongoing basis.
On the whole, decentralisation has been highly effective and, as Deputy Noonan will be aware, it contributes to the local economy in Limerick. Extensive use has been made of information and communications technology between Dublin and Limerick and our missions abroad. We have invested heavily in ICT and much of our communication is with our embassies and missions and relates to the bilateral programmes in our nine programme countries. Whether this is done from Dublin or Limerick is not an issue.
The nature of the Department means there will always be an issue of staff turnover. Every four years diplomatic staff are posted abroad and issues must always be dealt with when they return. That is, however, an administrative rather than policy matter.
I thank the Minister of State for his reply, which proves he is well suited to the diplomatic world.
Foreign affairs is the centre of diplomacy.
The Minister of State's answer reminds me of Churchill's description of Russia in so far as there was a touch of a riddle wrapped in an enigma in it. I may raise the matter with him again.
I should have pointed out that an issue arose regarding specialist development staff, a key group in the organisation who are highly qualified in development. Before decentralisation, there were major human resource issues among these staff. These were ultimately resolved and all the staff are now resident in Limerick and making a major contribution to the Department.
I ask the Minister of State to clarify one small point. As we move from interim to full EPAs or in the event of a regional EPA being agreed, will the countries participating on the African side not be subject to any requirement beyond the WTO requirements?
The word "requirement" is an interesting one. The question is whether there will be provisions in any such agreement that would go beyond what is normal in WTO agreements. There would be such provisions and one of the most significant of these would be development. There is a major development dimension to this matter which would not be in trade agreements.
The Singapore issues are, therefore, on the agenda again. The Minister of State's case related to WTO compliance but he has now announced that the final EPAs may go beyond WTO requirements.
This comes back to the basic point that if individual countries, by mutual agreement, wish to include provisions of benefit to them — it should be noted that these are agreements between sovereign countries — such provisions can be included. The biggest non-trading dimension to these agreements is development. Some €2 billion per year is invested by the European Union in building up the global trading capacity of these countries.
However, there is no additionality to the agreements; the €2 billion is in place.
There is a great deal of additionality to the agreements. Ultimately, it is a question of whether the agreements will, in the longer term, enable African countries to enter the global trading system. I believe they will.
It is a question of their meeting their WTO requirements.
The point is that the Minister of State is bidding it up.
The existing unilateral preferential arrangements between the European Union and the ECT countries——
And the WTO.
——are illegal. That is the bottom line.
Notification of such agreements as would meet the WTO requirements is far less than what is in the text of the EPAs. That is where the Minister of State's problem is. He is making his case on the basis of WTO compliance, yet when the cat is let out of the bag, we note the journey to the full EPA will include some issues which, for example, were won at Doha. We differ on this.
I acknowledge that, but the countries entering into the agreements, such as Mozambique, want extra provisions in respect of their bilateral arrangements with Europe.
It depends on who is asking for them. I am really talking about the ones the Union is asking for in its negotiations.
One can ask all one wishes regarding these agreements.
I know.
Ultimately, however, they are partnership agreements between sovereign states. It is up to countries to exercise their rights entering into the agreements. Some countries have not entered into them. They are adopting particular negotiating positions in the same way we would have adopted positions coming up to the Lisbon treaty ratification process. They put positions forward and row back, but it is open the countries ready to enter into the agreements, and which have initialled them, to sign them. That is what they are doing.
I am not against world trade. The Minister of State said I was around in the early days. I signed the Brandt report when Mr. Brandt visited Dublin; I have been around for that long. I am in favour of fair global trade and believe in a new north-south and international economic order. This is the whole point. Every argument I make is one that will facilitate a new national economic order with development at its heart, and which realises indigenous models of development. That is my position; I am not a Luddite or a flat Earth advocate.
We differ in that I believe the Minister of State is peddling an old model.
I respect the Deputy's position but we must deal with the actual position that obtains, namely, a globalised system of trade based on rules. This is part of that.
Deputy Higgins should not worry about being isolated; I have probably been around for nearly as long as he has been.
I believed it would have been much longer.
I thank the Minister of State for his patience. We have run more than half an hour over the time allowed. The Minister for Foreign Affairs is waiting to come in. Is it agreed that the committee recommends no further debate on the motions in the Dáil?
Will the Chairman please clarify for me? The committee finishes its business, we vote and that concludes our opinion as a select committee. Why is the select committee taking the view that it would seek to foreclose on the Dáil's response? We send a message to the Dáil to say that the select committee has made its decision, and that should be the end of it.
How can the Chairman foreclose on the Dáil's right, tomorrow morning, for example——
This is just a recommendation from the committee, and that is what normally happens. It is just that in this case the Deputy wants to ensure----
Of course, and I am being courteous in indicating that I shall be drawing attention to this tomorrow morning in the Dáil.
Question put: "That the committee recommends no further debate on the motion in the Dáil."
The Committee divided: Tá, 8; Níl, 3.
Tá
- Flynn, Beverley.
- Nolan, M. J.
- Ó Fearghaíl, Seán.
- O’Brien, Darragh.
- O’Connor, Charlie.
- O’Hanlon, Rory.
- Power, Peter.
- Woods, Michael.
Níl
- Higgins, Michael D.
- O’Sullivan, Maureen.
- Timmins, Billy.
Question declared carried.