Releasing the Joint Statement the Minister of
Trade, Industry and Cooperative, Hon Amelia Kyambadde who co-chaired the Joint Press
Conference noted that the new initiative will support the economic integration
of the EAC and enhances the EAC-U.S. trade and investment partnership. The Hon
Minister said that the new Partnership is built on the recognition of the
important role that trade and investment play in economic and social
development including job creation, both in East Africa and the United States.
On
his part, the Deputy USTR said that the EAC and the United States agreed on a
framework to move forward on the establishment of a Commercial Dialogue, which
will be formally launched in late November 2012. Commercial
Dialogue is a component under the TIP that establishes a consultative mechanism which will serve as a cornerstone
of linking and engaging Governments with the private sector of both Parties.
The dialogue will focus on promoting effective public-private partnership,
which are a critical mechanism for attracting greater U.S. investments to the
EAC region, especially in the area of infrastructure development, supply of
services, mineral development and manufacturing. The Dialogue will implement
its activities through targeted sector trade missions, activities and events;
coordinated programs between U.S. agencies and their EAC counterparts in
conjunction with trade associations and the diaspora. The East African Business
Council will lead the EAC private sector in engaging with their counterparts in
the U.S.
According to the Joint Statement the EAC and the
United States also agreed that their respective technical teams will meet at
the soonest possible date for further consultations and negotiation on the
other three components of the EAC-U.S Trade and Investment Partnership, that is; a bilateral investment treaty, a
trade facilitation agreement and continued capacity building.
The Bilateral Investment Treaty (BIT) aims at;
·
Protecting investments in the
territories of either Party where investor rights are not already protected
through existing agreements;
- Encouraging the adoption of market-oriented domestic policies that treat private investment in an open, transparent, and non-discriminatory way; and
- Supporting the development and application of international law and standards consistent with the objectives of the cooperation.
The Parties will also negotiate and sign a Trade
Facilitation Agreement which will provide for development and implementation of
policies that promoted efficiency in the territories of the Parties through
reduced transaction costs associated with the enforcement, regulation, and
administration of trade policies.
The technical teams will further discuss and
agree on the trade capacity building assistance, including identification and
agreement of priority areas for support under the Trade and Investment
Partnership. The EAC has identified the priority areas for the U.S support
under the EAC-U.S Trade and Investment Partnership including the strengthening of region Integration by
supporting EAC Partner States on
- Harmonizing customs regulations, improving customs inter-connectivity and harmonization of standards,
- Development of an efficient regional payment system, customs and financial market integration
- Establishment of an efficient regional infrastructure
- Promotion of technology transfer
- Development of capacity for trade and business development.
Through consultations the EAC will identify more
priority areas for support under the EAC-U.S Trade and Investment Partnership. The negotiations may include
development of a binding mechanism for delivery and implementation of the
program under the capacity building support.
The EAC Ministers acknowledged that the United
States already provides substantial assistance to the EAC Partner States and
the Secretariat, including an additional amount of up to $10 million (ten
million United States Dollars) that the United States will provide over the
next five years to the EAC Secretariat to support regional economic
integration.
As the next step, the EAC Ministers and the USTR
agreed to advance the EAC-U.S Trade and Investment Partnership within their
respective administrations. They also agreed to hold their next Ministerial
meeting on the margins of the 2013 AGOA Forum.
The
EAC-U.S TIP negotiation process was initiated and announced by the EAC Ministers
of Trade and the USTR at the AGOA Forum in Washington D.C. earlier this year. In
the first Joint Statement released on 14th June 2012, the EAC and U.S announced that the new EAC-U.S. Partnership
will build on the foundations of the existing trade and investment
relationship, including the African Growth and Opportunity Act (AGOA), and the
U.S.-EAC Trade and Investment Framework Agreement (TIFA). In addition, the
Statement indicates that the TIP will provide new business opportunities to
U.S. and EAC firms by reducing trade barriers, improving the business
environment, encouraging open investment regimes, and enhancing two-way trade. It is hoped that
the EAC-U.S Trade and Investment Partnership arrangement will also serve as a building block towards a more
comprehensive trade agreement over the long term.
The EAC-U.S. Trade and Investment Partnership is also
an important component of the U.S. Strategy Toward Sub-Saharan Africa, which
President Obama announced in June 2012. The Strategy outlines four main pillars
which include.
- Strengthening democratic institutions,
- Promoting economic development,
- Ensuring regional security, and
- Continuing to improve development assistance initiatives.
The
strategy makes clear that the focus of Obama’s plan lies in the first two
pillars.
