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Missed EPA deadline

Natasha Beckles

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Barbados has not yet honoured its commitment to introduce a second set of tariff cuts on some European products – a requirement under the CARIFORUM-European Union Economic Partnership Agreement (EPA).
The island’s lead trade consultant has told BARBADOS BUSINESS AUTHORITY the Europeans were not happy with this situation but were, however, unlikely to take “punitive actions” against the island at this time.
The reduction in import duties on live animals – with the exception of fowl, turkeys and ducks – and the meat of horses, rabbits, whales, dolphins and porpoises, as well as a variety of fruit and nuts, were scheduled to be implemented by January 1.
However, a consultant with the EPA Implementation Unit in the Ministry of Foreign Affairs and Foreign Trade, Errol Humphrey, said as far as he was aware, the legislation was in draft form and had not gone through “all of its various processes” as yet.
He told BARBADOS BUSINESS AUTHORITY the delay in reducing the tariffs was not due to any “real challenges”.
“During these first few years of the implementation, the tariff implications for Barbados were negligible in terms of revenue and that kind of thing.
“It’s simply a matter of programming and scheduling the legislation and getting it through its various phases,” he said.
Humphrey noted that at the end of last year, eight of the 15 CARIFORUM states had completed the tariff cuts for 2011.
The former Barbados ambassador to Brussels said the delays had been discussed with the European Union (EU) during the joint meetings provided for under the agreement.
“They are not happy that we haven’t done the tariff cuts but they’re not going to take us to arbitration or something. Nothing like that is perceived.
“While we need to make the tariff cuts and the EU is reminding us we need to make them, I don’t think they’re proposing any punitive actions at this time,” he said.
Humphrey added that Barbados and some other member states were prepared to address any situation where a regional company wanted to import something from the EU that was covered under the tariffs to be cut.
Joel Richards, trade consultant with the Barbados Private Sector Trade Team, noted that some of the goods scheduled for tariff reduction might be competing or directly substitutable for local products, even if they were not themselves produced locally.
“For instance, maize oil is not produced locally but we do produce soybean oil. Maize oil can be used as a substitute [for] soybean oil and as such, can be considered as a ‘like’ or ‘competing’ product.
“Therefore, as we gradually reduce duties on maize oil for which there is no domestic production, we are inadvertently reducing the margin of protection for the local soybean oil industry,” he said.
Richards noted that as tariffs were reduced and competition increases, local producers were going to have to focus heavily on innovation.