Exporters in Rwanda will be buoyed by the news that Rwanda might be allowed to enjoy the benefits of the Economic Partnership Agreement (EPA) if other East African community member countries do not sign the deal by the new agreed deadline.
Rwanda and Kenya have signed the agreement (EPA) with the European Union but its EAC partners say the deal does not fit well for the region’s economies.
Having had an earlier deadline of the 1st October, EAC members were granted an extended period of three months to review the agreement with optimism that it will be signed as a bloc, “at this moment the ball is in the hands of the EAC countries but we can’t rule anything out in the future,” said Michael Ryan, the Union’s ambassador to Rwanda.
East Africa being a single customs territory, however, the other EAC members – Tanzania, Uganda, Burundi and South Sudan must also sign for the pact to be possible.Tanzania, however, declined to sign. Uganda says the agreement needed consensus between presidents, while Burundi’s political instability also appeared as a barrier to the deal with the EU.
According to financial experts, the current EPA agreement is a raw deal for the community citing it not favorable for long term growth, “by agreeing to the current terms of the agreement, the European union will be able to flood our markets with cheap high quality goods while we can only export our raw materials. This in the long run affects the growth of local manufacturers,” said Dave Nkusi an economics expert with Think Africa.
The EPA is intended to guarantee the EAC traders duty-and-quota free access to the EU market in exchange for a gradual opening of up to 80 per cent of the region’s market to European products.
At the recent East African heads of state summit in Tanzania. The leaders of the EAC countries agreed to carry out more consultations regarding the EPA.
EAC members have been negotiating the EPAs since 2007 leading to conclusion of negotiations in 2014. Among the six member states, Tanzania has publicly indicated its unwillingness to sign the agreement with Europe saying it could stifle its economy, while Burundi has been blowing hot and cold on the agreement.