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RESOLUTION OF THE 106th SESSION OF THE ACP COUNCIL OF MINISTERS HELD IN BRUSSELS,BELGIUM, FROM 5TH TO 6th DECEMBER 2017

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ACP AGRICULTURAL COMMODITY TRADE AND SECTOR DEVELOPMENT

 

The ACP Council of Ministers,

-        meeting in Brussels, (Belgium), from 5 to 6 December 2017

 

A.              HAVING REGARD to the resolution on ACP Agricultural Commodity Trade and Sector Development adopted by the 105th Session of the ACP Council of Ministers held in Brussels, from 3rd to 4th May 2017;

 

B.              RECALLING the New Approach on support for the development of agricultural value chains, which targets actors along the value chain including family farms, MSMEs, women and youth, and aims at empowering them to participate fully in the transformation and modernisation of the agricultural sector at the national and regional level;

 

C.               UNDERLINING the fact that the New Approach is based on four (4) Pillars namely: Finance, Capacity Building, Trade and Investment and Climate Change, and noting that Finance is the main sector of concentration for intra-ACP intervention as it is the main constraint that weighs heavily on ACP farms and prevents the modernisation of the sector;

 

D.              NOTING that the global trend in banana production has been on the increase with Latin America accounting for 76% of the production and 70% of the European market while ACP market share still remains at 19% with most bananas being exported to France, Spain and the UK; 

 

E.               CONCERNED about the proliferation of FTAs that has led to the increase in banana imports into the EU market, with increase in imports from Nicaragua, Guatemala and Peru which have gone beyond the 80% defined thresholds, under the trade agreements signed with the EU;

 

F.               RECALLING the commitment made by the European Commission not to go below the tariff rate floor of 75 euros per tonne applicable to third countries in the context of future Free Trade Agreements or those under negotiation with regard to the Banana sector;

 

G.              RECOGNISING the socio-economic importance of the cashew sector for the development of several ACP countries, and the sustainable development prospects that this sector provides for employment especially for women and the youth;

 

H.              DEEPLY concerned with the abrupt declining cocoa prices by almost 40% within one year which has generated tremendous macroeconomic shocks in cocoa-dependent exporting countries and impacted negatively on the incomes of among others cocoa producers and smallholder cocoa farmers;

 

I.                NOTING the significant progress made in the context of the EU-Africa Partnership on Cotton, regarding implementation on the Support Programme for the consolidation of the Action Framework which ended in November 2017;

 

J.                ACKNOWLEDGING that the project / program approach which has a strong subsidy component has shown its limitations, while it has helped to develop various good practices and demonstrate their feasibility along the cotton value chain, it does not allow them to be scaled up;

 

K.              RECOGNISING the good progress made so far in the harmonisation exercise of the Pan-African Cotton Investment Programme with the C4 “Route du Cotton” which both aim at bringing sustainable development to the Cotton Sector;

 

L.               RECALLING the Hong Kong Mandate on Cotton which called on the need to address cotton ambitiously, expeditiously and specifically, within the agriculture negotiations in relation to all trade-distorting policies affecting the sector in all three pillars of market access, domestic support and export competition;

 

M.             NOTING with concern the end of the EU sugar quota system, which took effect on 1 October 2017 and which will significantly decrease ACP and LDC imports and erode even further the price preference which has, until now, done much to foster socio-economic development in ACP and LDC countries, whereas, it is expected the EU will more than double the quantity of sugar it exports to the world markets, including to some of the ACP regional markets;

 

N.              FURTHER concerned that Voluntary Coupled Support (VCS) has had a negative impact on the price of sugar, and that VCS would undermine the concept of a market-based reform leading to serious consequences for ACP suppliers that were not foreseen initially;

 

O.              DEEPLY CONCERNED about the EU plans to modify its market access offer to Mercosur to include sensitive products, among them sugar, during the next round of trade talks between 4 and 10 December 2017;

 

P.              NOTING that as of end December 2016 the de-commitment amount of EUR 64.481 million, under the Accompanying Measures for former Sugar Protocol (AMSP) countries, cannot be used anymore because the deadline for contracting is over;

 

Q.              RECALLING the positive results achieved under phase I of the ACP Sugar Research Programme (ACP-SRP) which contributed to enhancing the competitiveness of the ACP sugar sector;

 

R.              CONCERNED at the potential harmful impact of the United Kingdom’s planned withdrawal from the European Union on 29th March 2019 on the market access and trade regime for ACP States in the United Kingdom, which may result in the reduction of imports;

 

S.               HAVING EXAMINED the report of the Ministerial Consultations on Commodities held on 4th December 2017, in Brussels, Belgium and paying particular attention to the recommendations thereof;

 

HEREBY RESOLVES TO:

 

1.           Recognises the  ACP  Group is at a crossroad,  having to define its post 2020 future globally, and to redefine its partnership with the EU, while simultaneously addressing a number of  challenges  including BREXIT,  preference erosion and the sharp drop in commodity prices; hence  the need to strategise and reposition itself  through   implementation of key strategic  policies such as the  New Approach  which places emphasis on adding value to commodities thereby facilitating the process of transformation of  ACP  economies  and enabling integration  into the regional and ultimately global value chains;

 

2.       Welcomes the finalisation of the Implementation Modalities for the New Approach on support for the development of agricultural value chains and urges the expeditious completion of the development of the Programme on agricultural value chains which will articulate support to various sectors including banana, cotton, sugar, cashew, cocoa, kava, rum fisheries, livestock and tobacco;

 

3.       Agrees that the structure of the Ministerial Consultations on Commodities should reflect the framework of the new approach which focuses on cross cutting challenges and opportunities faced by the commodities sectors   and instructs the Committee of Ambassadors and the Secretariat to ensure that future discussions in the Ministerial Consultations are framed along common themes such as the effect of FTAs concluded by EU with Third Countries, preference erosion and opportunities presented by BREXIT etc;

 

4.       Reiterates its concerns about the proliferation of FTAs, that has affected the preferences given to the ACP States, and has negatively impacted on the competitiveness of several ACP exports;

 

5.       Expresses concern in this context that Nicaragua, Guatemala and Peru have gone beyond their defined thresholds in terms of banana exports into the EU market, which may have an eventual impact on the banana price levels and he overall stability of the EU banana market;

 

6.       Calls upon the EU to stand by its commitment to maintaining a tariff rate floor of 75 euros per tonne for third countries in order to guarantee stabilisation of the EU banana market and invite the EU to dialogue through the Joint Banana working group with the aim of monitoring and ensuring stability in the EU Banana market;

 

7.       Request the ACP Secretariat to facilitate the participation of ACP Member States in the cocoa working group established under the International Cocoa Council, which has been set up to formulate policies and programmes aimed at addressing the current crisis on cocoa prices, with the view to ensure ACP interests are taken on board;

 

8.       Calls upon the Committee of Ambassadors to finalise work on the harmonisation exercise of the Pan-African Cotton Investment Programme with the C4 “Route du Cotton”, which will set the tone for future support to the Cotton Sector (C4);

 

9.       Further calls upon the Committee of Ambassadors to ensure that future support to cotton promotes a public-private partnership with shared responsibilities where the subsidy element is used strategically to mobilise funding from partner financial institutions and the private sector;

 

10.   Upholds the ACP Position on Cotton, by supporting a meaningful outcome on Cotton at MC 11 on the basis of the proposal tabled by the C-4;

 

11.   Stresses its concern on the imminent negative effects of the end of the EU Sugar quota system on ACP States and calls for dialogue   with the EU, with a view to explore remedial measures aimed at mitigating the effects;

 

12.   Reiterates its concern about the continuing EU subsidies to its sugar industry notably in the form of voluntary coupled support (VCS) provided to beet farmers which can materially damage the commercial prospects for ACP sugar suppliers in Europe and calls on the EU for appropriate remedial actions; 

 

13.   Underscores the need for the EU to ensure   that prior consultations are held with the ACP as required under Article 12 of the Cotonou Partnership Agreement and calls on the EU to engage on VCS under the established consultative mechanisms;

 

14.   Also Calls on the EU for urgent consultations, as provided for under Cotonou Partnership Agreement, on the intention by the EU to modify its market access offer to include sensitive products such as sugar in the ongoing FTA negotiations with Mercosur;

 

15.   Reiterates the longstanding request by the ACP sugar producing countries to the EU for funding support to be secured for the next phase of the Sugar Research Programme which is one of the success stories of the ACP-EU relations and further acknowledges the finalisation of the list of Project Proposals that will form the basis for the second phase of the ACP Sugar Research Programme;

 

16.   Emphasizes the importance of ensuring that there is no elimination or disruption of trade post-BREXIT   and mandates the conduct of a study on challenges and opportunities;

 

17.   Invites the President of the Council of Ministers to forward this resolution to ACP regional economic integration organisations, the Commission of the African Union, the Council of the European Union, the European Parliament, EU Member States, and the European Commission.

 

Brussels, 06 December, 2017


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