The highly-anticipated trade pact between the EU and Peru has provisionally entered into force, officials announced last week. The deal has yet to take effect with regard to Colombia, however, which has also signed the agreement. On a separate front, the 27-country bloc has also announced the official launch of negotiations with Morocco.
Peru deal enters into force; Colombia ratification pending
Following years of negotiations, Brussels’ and Lima’s highly-anticipated trade deal is now provisionally in effect as of 1 March, though the EU’s 27 member states will still need to individually ratify the deal as the final formal step in the process.
“In times of economic crisis, with limited internal demand and tight budgets, trade can help boost growth and jobs without causing further strain on the public purse,” EU Trade Commissioner Karel De Gucht said on Friday in welcoming the pact’s entry into force. “This agreement does just that and will really foster sustainable, high-quality business and investment on both sides.”
The EU’s deal with Peru was part of a broader agreement that was negotiated jointly with Colombia; while Bogotá, like Lima, signed the deal with Brussels in June 2012, its ratification processes are still ongoing and are expected to be completed later this year.
Peru, meanwhile, officially ratified the agreement on 8 February, after the European Parliament formally backed the deal last December. (See Bridges Weekly, 5 December 2012)
According to the European Commission, the agreement leaves the option for accession open to Bolivia and Ecuador, which together with Colombia and Peru make up the Andean Community. The trade deal had originally been planned as a region-to-region pact between the two groupings, with Brussels ultimately shifting gears to bilateral negotiations with Andean Community members after the latter set found itself unable to agree on various issues. (See Bridges Weekly, 3 March 2010).
The newly-enacted deal is expected to slash over €500 million in duties alone, according to the European Commission, and will liberalise all trade in industrial and fisheries products among the participating economies. The agreement also includes provisions on trade in services, public procurement, and intellectual property rights.
Notably, the pact also features a commitment to implement international conventions on labour rights, along with a clause focused on preserving a high level of environmental protection standards on all sides.
The EU is the third largest source of imports for Peru, while serving as the main destination for the South American country’s exports. Bilateral trade has grown considerably in the past few years, amounting to €9.2 billion in 2011.
Morocco talks kick off
The EU and Morocco also kicked off their own trade negotiations this week, during European Commission President José Manuel Barroso’s visit to Rabat.
“The agreement will deepen our economic relationship in the interest of our citizens, our businesses, our societies,” Barroso said on Friday in announcing the launch of the talks with Moroccan Prime Minister Abdelilah Benkirane. “Together, we lay the foundation towards a future common economic space between the EU and Morocco, and I am pleased to see our partnership become significantly strengthened.”
Morocco is the first country from the Mediterranean region to hold trade talks with the EU. Plans for a bilateral pact date back to 2000, when the two sides inked an Association Agreement that provided for, among other things, a free trade area.
ICTSD reporting; “EU reaches trade deal with Colombia, Peru,” EUROPEANCEO; “Peru-EU trade agreement takes effect today,” ANDINA, 1 March 2013; “Morocco and EU to Negotiate Free Trade Agreement,” NUQUDY, 3 March 2013.
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