EU-Kenya Economic Partnership Agreement closer to approval
The EU-Kenya Economic Partnership Agreement (EPA) has today taken a step towards approval, with the Commission sending to the Council proposals for its signature and conclusion. The EU-Kenya EPA will boost trade in goods and create new economic opportunities, with targeted cooperation to enhance Kenya’s development. It is the most ambitious EU agreement with an African country thus far as regards climate protection and labour rights. The agreement foresees immediate full liberalisation of the EU market for Kenyan products, and will incentivise EU investment in Kenya, thanks to increased legal certainty and stability. The EPA contains strong trade and sustainability commitments, including binding provisions on labour matters, gender equality, environment, and the fight against climate change, and a dedicated chapter on economic and development cooperation to enhance the competitiveness of the Kenyan economy.
The deal will be supported by the implementation of the Global Gateway Africa-Europe Investment Package announced at the 6th EU-African Union Summit in February 2022. It will facilitate trade and investment, accompanied by trade-related development cooperation, with a view to further deepening the economic ties between the EU and Kenya, boosting sustainable economic growth, and creating jobs.
The EPA will also directly contribute to the objectives of the UN 2030 Agenda for Sustainable Development, and to the African Union Agenda 2063. It will also support the green and digital transitions of both partners.’
EU and the Republic of Korea facilitate trade in agricultural products
The European Commission and the Republic of Korea signed an administrative arrangement to cooperate on electronic health certification and on the harmonisation of such certificates for exports of agricultural products from the European Union to the Republic of Korea.
This agreement is a concrete demonstration of the mutual trust and confidence between the EU and Korean authorities, and gives effect to commitments undertaken between the EU and Korea in our bilateral FTA, and at the WTO. The arrangement, which aims to be implemented before 2025, establishes a new electronic certification exchange system for bilateral trade of agricultural products. This will be a mutually beneficial tool, as it will enable EU exporters to reduce their administrative burden, and increase Korean consumers’ trust. It thus contributes to further digitalisation of trade – to the benefit of producers, traders and consumers alike, saving time and money through the real time exchange of information.
The electronic certification will benefit mutual trade and all EU Member States exporting processed meat, dairy and/or egg products, and it lays the ground for enhanced cooperation on additional future commodities exported to Korea. Once the arrangement is officialised, technical preparations and IT setup will begin. This will enable work on harmonised certificates and on a pilot program with a focus on specific products.
Serbia, UAE to sign free trade deal
Serbia expects to sign a free trade agreement with the United Arab Emirates (UAE) by the end of this year, the head of Serbia’s Chamber of Commerce said. The second round of negotiations on the free trade agreement will be held by the end of October. In January, the governments of Serbia and UAE signed a Memorandum of Cooperation (MoC)on the development of hydrogen and other renewable energy sources.
India, UK free trade deal unlikely to finalise by month end
India and the United Kingdom (UK) are unlikely to ink the much-anticipated trade deal by the end of October due to unresolved differences over market access issues, especially in services. Both nations missed last year’s Diwali deadline for the deal set by former British Prime Minister last year. With general elections in both countries next year, the window for a trade deal is rapidly closing. “A lack of progress” in opening up the Indian markets for British professional services, including law and accountancy firms, is one of the reasons for the delay, stated the report, quoting unnamed British officials. Currently, the negotiations between the two nations are in the last lap, with both sides attempting to iron out the differences. Last week India Commerce Secretary said that the negotiations are at an “advanced stage”.
The UK has been seeking more opportunities in telecommunications, legal, and financial services in the Indian markets as part of the deal, while India’s focus has been on a liberalised migration policy for its skilled workers. Other contentious issues include the UK’s demands for lower tariffs on whiskey and automobiles, and chapters on rules of origin and intellectual property rights (IPR).
UAE signs CEPA with Georgia, deal to come into effect in Q1-24
The UAE and the Republic of Georgia have signed a Comprehensive Economic Partnership Agreement (CEPA) that will eliminate or significantly reduce tariffs, remove non-tariff barriers and promote trade in goods, services and investment. The deal will take effect in the first quarter of next year, the countries have confirmed. The agreement will significantly expand UAE’s export opportunities, with a minimum expectation of at least $1.3 billion in exports to Georgia over the next five years. The two countries were able to complete negotiations and sign the trade agreement after just three rounds of talks. The percentage of the tariff reductions is almost 95 per cent of the overall historical trade between UAE and Georgia.
India, Peru set to resume discussion on trade agreement
The commerce ministry of India said that a special round of negotiations for the India-Peru trade agreement has taken place during 10-11 October and will include an investment chapter. Talks for the India-Peru trade agreement commenced in 2017, with the fifth round concluding in August 2019. The sixth round is slated to be held in December 2023 in Lima, Peru. The negotiations had come to a pause due to the coronavirus pandemic.
United States and Kenya to hold second negotiating round under the Strategic Trade and Investment Partnership
The United States and Kenya hold a second in-person round under the Strategic Trade and Investment Partnership (STIP) in Washington, DC, on October 4-7, 2023. The negotiators last met in person under the STIP in April 2023 in Nairobi, Kenya, and have continued to make progress in deepening mutual understanding and resolving differences. This round of discussions covered four of the topics under the U.S.-Kenya STIP: (1) agriculture, (2) anti-corruption, (3) inclusivity, and (4) services domestic regulation.
India, UAE discuss bilateral investment treaty
India and the UAE discussed a bilateral investment treaty that could see the UAE invest in India’s renewable energy, health, semiconductor and asset monetisation sectors. Leaders from both countries reviewed progress made on the implementation of the Comprehensive Economic Partnership Agreement (CEPA) between India and the UAE, which came into force in May 2022. The UAE-India High Level Joint Task Force on Investments that took place in Abu Dhabi also assessed progress made on the creation of a mechanism to fast-track Indian investments into the UAE. The Indian side called for strengthening the mechanism, especially for investments in priority sectors such as renewable energy and energy transition, the commerce and industry ministry added.
ASEAN, Canada a step closer to concluding trade deal by 2025
ASEAN and Canada are aiming to conclude the negotiations on a free trade deal by 2025, and both sides have recently moved a step closer to that goal. The Indonesian province of Bali hosted the fifth trade negotiating committee for the ASEAN-Canada Free Trade Agreement (ACAFTA) talks.
ASEAN and Canada agreed to launch the ACAFTA negotiations in 2021. Canada called the 10-membered ASEAN grouping its fourth-largest merchandise trading partner in 2021. Last year, Canada-ASEAN merchandise trade totaled $40.7 billion. A joint feasibility study shows that a Canada-ASEAN FTA that liberalizes trade in goods reduces non-tariff measures, and improves trade facilitation can increase the Southeast Asian bloc’s gross domestic product (GDP) by $39.4 billion. The same study shows that Canada is expected to get a $5.1 billion in GDP gain. The same deal is expected to add $7.1 billion to Indonesia’s GDP. The government reported that Indonesia-Canada trade rose from $3.1 billion in 2021 to $4.3 billion the following year. Indonesia, however, posted a $1.7 billion trade deficit with Canada in 2022.
Indonesia and Canada are also currently trying to seal a bilateral comprehensive economic partnership agreement —also known as the ICA-CEPA— by next year. Indonesia said the ICA-CEPA could boost its GDP by $1.4 billion. The deal is also expected to increase Indonesia’s exports to Canada by $851 million in the medium term.
Mercosur and EU to resume negotiations in October
Negotiators from the European Union and Mercosur — the trade alliance between Brazil, Argentina, Paraguay, and Uruguay —convened in Brasília on October 3 and 4 in the hopes of making possible the ratification of a free-trade agreement between the two blocs. The two sides reached an agreement in 2019 but ratification of the deal has hit snag after snag. European countries with strong agricultural lobbies, led by France, have raised environmental concerns to block the deal — an argument that was heavily validated by the lack of deforestation controls in Brazil during the previous Jair Bolsonaro administration.
Still, the EU in March presented a side letter, a sort of annex to the proposed deal, with additional requests for environmental constraints. The draft rules would require voluntary environmental commitments made under the 2015 Paris Agreement to be enforced by sanctions.
Brazil has adamantly opposed the side letter, which the government considers to be punitive and discriminatory. The Lula administration has also taken issue with a provision opening up Mercosur’s market of public purchases to EU bidders.
Ukraine and Canada conclude updated free trade agreement
The modernized Canada-Ukraine Free Trade Agreement (CUFTA) marks a new era in Canada and Ukraine’s economic relationship and will be fundamental to the participation of Canadian businesses in Ukraine’s economic reconstruction and recovery from Russia’s illegal and unjustified invasion.
The modernized CUFTA includes dedicated new chapters and provisions on trade in services (including financial), investment, temporary entry for business persons, telecommunications, digital trade, labour and the environment, among other areas. New chapters on inclusive trade have also been added to ensure that the benefits of CUFTA are more widely shared, including in the areas of:
- small and medium-sized enterprises;
- trade and gender, and
- the first-ever trade and Indigenous Peoples chapter that Canada or Ukraine has ever included in a concluded free trade agreement.
When in force, the modernized CUFTA will not only continue to provide preferential market access for merchandise trade, it will also establish ambitious new market-access terms for services trade and investment.