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Ghana likely to sign EPA as EU tightens noose

June 24, 2016, 10:33 a.m.

The date, October 1, 2016, is set and will no longer be extended; Ghana must sign the interim Economic Partnership Agreements like the Ivory Coast has done, or non-traditional exports will not enjoy duty-free and quota-free access to the European Union market.

According to the EU Ambassador Ghana William Hanna, extending the date “is no longer possible”, and the attitude of the Ghanaian government - which is egged on strongly by exporters to the EU market - points to the country signing the agreement in the not-too-distant future.

Some 16 years of back and forth have passed, and the initial expectation that ECOWAS as a regional block would sign the agreements does not seem likely any time soon, as big brother Nigeria has said it is not ready to sign.

Ghana must therefore go it alone, at least in the interim, just like La Cote D’Ivoire has done.

Leading efforts toward signing is Foreign Minister Hannah Tetteh, who easily comes across as the one person in government who is most responsive to the EPAs.

When she was Trade and Industry Minister, Hannah Tetteh often reminded the Third World Network and other civil society organisations that are opposed to the EPAs of the dangers that awaited the country if an agreement was not reached.

She is, incidentally, currently serving as a stand-in Trade and Industry Minister because Dr. Ekwow Spio-Garbrah is said to be on leave, and she is leading discussions with private sector actors on the need to reach a consensus as the October 1, 2016 deadline draws nigh.

A meeting was held at the Foreign Affairs Ministry yesterday, which meeting discussed the consequences for Ghanaian exporters if the country fails to sign an interim EPA in the absence of an ECOWAS-wide agreement.

Exporters to the EU market in the cocoa, tuna and fruit industries made a strong case for signing, saying if the country does not sign their businesses will collapse and the thousands of people they employ will go jobless.

In the cocoa sector, for example, where the EU happens to be the largest importer of processed and semi-processed cocoa from Ghana, a 6.1% import tariff will apply to cocoa liquor, 4.2% to cocoa butter, and 2.5% on cocoa powder if the country does not sign the agreements.

In the fruit sector, George Kporye - Corporate Affairs and Administrative Manager of Golden Exotic Limited, West Africa’s largest exporter of bananas - told the meeting that should the country fail to sign, every box of bananas from his company will attract a 19.4% tariff at all EU ports.

Meanwhile, 90 percent of the company’s produce, he said, goes to the EU market -- adding that in view of uncertainties regarding the agreement, his company has put a hold on capital investments.

The livelihoods of some 2,500 people who work with the company are at stake, he said, concluding that the country needs to sign the treaty “and sign quickly”.

General Manager of giant tuna processer Pioneer Food Cannery Ltd., Nicol Elizabeth, expressed similar sentiments; threatening that his company has already started some level of production in La Cote D’Ivoire, and will not hesitate to relocate fully if Ghana fails to sign the agreement.

“The reality is today we are testing the market; we are producing in Ivory Coast as a trial, on a one-line basis just to see how quickly we can relocate to that country,” he said.

“But we don’t want to go to Ivory Coast. We had the opportunity to acquire two factories in Ivory Coast three years ago and we refused because we thought Ghana was the place to be, and we will be in Ghana because I know the honourable minister [Hannah Tetteh] and government of Ghana will do the right thing,” he concluded.

Present at the meeting was CEO of the Association of Ghana Industries Seth Twum Akwaboah, who said while the consequences of a no-EPAs deal for Ghanaian exporters is clear, it is imperative that the country also considers the consequences of signing the agreements on other businesses.

Also present was Mr. Charles Mensah of Myroc Foods, who expressed concern that while the EU will definitely take full advantage of the EPAs to boost its exports to Ghana, the Ghanaian government does not seem to be doing much to prop-up the export sector so that the country does not end up with a raw deal.

Indeed, those who are against the Economic Partnership Agreements being negotiated between the European Union and the African, Caribbean and Pacific Group of States, have argued that the agreements are simply about the latter groups opening up their already struggling markets to further domination/obliteration.

In Ghana, the Economic Partnership Coalition - a group of civil society actors - has been pestering government to do a cost/benefit analysis to determine whether signing or not doing so is better for the country.

While negotiations for a regional EPA were still on-going, an interim agreement was initialled in December 2007 by Ghana and the EU. This interim agreement allowed Ghana to avoid any disruption of its exports to the EU after 1 January 2008, the end date for the trade provisions of the Cotonou agreement signed in June 2000.

From October 2016, Ghana will continue to enjoy duty-free and quota-free access to the EU only on the basis of ratifying the interim EPAs or entry into force of regional EPAs.

As is the case for the interim EPAs, the regional EPAs currently under political validation provides duty-free and quota-free access to the EU market for an unlimited period for all imports originating in Ghana.

In return, Ghana and other West African countries are expected to gradually liberalise 75% of their imports from the EU over 20 years. 

“This asymmetric and gradual opening of the Ghanaian market to European goods takes into account the different level of development between Ghana and the EU, and affords enough flexibility to protect sensitive sectors as well as to preserve fiscal revenues,” an April 2014 European Commission document on how the EPAs can help Ghana’s sustainable development indicates.

Source: B&FT