Namibia reaches positive trade balance with EU

Martin Endjala

The Ministry of Industrialization and Trade in partnership with the European Union has today launched the Economic Partnership Agreement, EPA Implementation Plan, which ensure inclusivity, sustainability and economic growth through partnering in trade.

Lucia Iipumbu, the Minister of Industrialization and Trade on the occasion of the SADC-EU EPA trade forum and the launch of the EPA Implementation Plan held in Windhoek said that forum was held under the theme “Towards increased and diversified trade under the Economic Partnership Agreement (EPA) Implementation Plan’’.

It is first of its kind jointly organized forum by the MIT and the EU Delegation in Namibia, with Namibia a Member of the Organization of the African, Caribbean Pacific (OACPs) countries, a partner of EPA, which superseded the Cotonou Agreement.

The Cotonou Agreement had replaced the Lomé Conventions, that was the basis for ACP-EU

development cooperation since 1975. Since the First Lomé Convention in 1975, the EU has granted non-reciprocal trade preferences to ACPs countries under the Cotonou Agreement of which the Trade Chapter thereof was replaced by the EPA, a new arrangement that took effect in 2008.

The new arrangement is to provide for reciprocal trade agreements, meaning that it is no longer only the EU that provides duty-free market for OACPs exports, but OACP countries also provide market access for EU exports. Namibia and five (5) other SADC member states, Botswana, Eswatini, Lesotho, Mozambique and South Africa signed the Economic Partnership Agreement (EPA) in June 2016, which provisionally came into force in October 2016 and was fully implemented in February 2018 upon ratification.

The EPA provides, duty-free, quota free market access into the EU for exports from partner states like Namibia, subject to rules of origin and adherence to international and regional quality standards.

Iipumbu pointed out that the main development objectives of the EPA are to alleviate poverty, promote sustainable development and facilitation of the gradual integration of OACPs into the global economy through trade. The Agreement is also said to boost trade and business opportunities in Namibia in order to contribute towards sustainable and inclusive economic development in the frameworks of the ACP-EU Partnership and the EU-SADC Economic Partnership Agreement (EPA). Despite the benefits from the EPAs there are numerous trade barriers such as, sanitary and phytosanitary (SPS), technical barriers to trade (TBT), stringent Rules of Origin (RoO), more specifically on cumulating among SADC-EPA States and other non-tariff barriers (NTB) limit regional integration.

The forum is aimed at exchanging information between negotiators and the business community on

potential bottlenecks that the private sector might experience in implementing or utilizing the EPA.

The EPA Implementation Plan was developed with the support and financial assistance from the EU. “We are happy to note that the Plan is being implemented with the support of the EU through a Financing Agreement between NPC and EUD. Due to the COVID-19 pandemic interruptions, its official launch and immediate implementation could not take place,” said Iipumbu.

Meanwhile, the EU Ambassador to Namibia Sinikka Antila said that more than 130 participants were following the event both in person and online.

This impressive turnout Antilla emphasized demonstrates the interest shown by the business community to learn more on how to access the EU market and about the EPA. The EU is the largest trading partner of SADC according to 2019 figures and the second export market for Namibian products.

In order to assist Namibia to effectively implement the EPA Implementation Plan, the EU provided €6 million to the Namibian Government. Between 2011 and 2021, Namibia exports to Europe have grown by 50 percent to €1, 36 billion,

while its imports have grown by only 8, 9% worth €511 billion, meaning that Namibia’s trade balance

with the EU is positive and increasing the ambassador explained.

It also provides long-term free access to the EU market, to increase incentives for local and foreign companies to invest in EPA countries, to create jobs and to diversify the economy. Due to flexible Rules of Origin, the EPA also supports regional integration and the development of regional value chains. Antilla also announced that EU together with MIT and NIPDB have envisaged to organise a Business Forum in 2023. The idea of the business forum is to bring together EU and Namibian businesses to network and explore investment opportunities around emerging economic sectors.

By Observer