Economic Partnership Agreement (EPA)

The Economic Partnership Agreement (EPA) is a free trade agreement between the European Union (EU) and the Pacific ACP group of States (PACPS). EPA negotiations started in 2004 and in 2007 Fiji and Papua New Guinea (PNG) signed an interim EPA (iEPA) with the EU. They both ratified the interim EPA in 2011. After 2007 negotiations continued between all PACPS and the EU towards a comprehensive EPA. The comprehensive EPA is intended to go beyond the scope of a traditional free trade agreement and to provide a new and comprehensive basis for trade relations with the EU interlinking regional integration, trade, with some focus on sustainable development and poverty alleviation.  

EPA’s negotiations follow the adoption of the Cotonou Agreement which aimed to reduce poverty while contributing to sustainable development. ACP-EU Partnership signed Cotonou Agreement on 23 June 2000 and this agreement will expire in 2020. The agreement defines the current mechanisms to allocate EU aid and to advance political dialogue between EU and ACP countries. After 2020 the EU is likely to use the EPA as the main tool to advance political dialogue and development cooperation.

The year 2013 was intensive for the PACPS with and unprecedented number of negotiation sessions with the EU. It was also the first time that the PACPS met with the EU at ministerial level since 2007. But despite the PACP’s best efforts to conclude by 2013, negotiations came to an impasse at the negotiating session on 14 October 2013 when PNG informed the European Commission (EC) Officials that it would be unable to participate in the comprehensive EPA negotiations for a number of reasons.

Current Status

During the PACP Leaders and Ministers meeting in July 2014, PACP leaders expressed concern at the time taken to conclude the EPA negotiations with the deadline for negotiations being pushed back multiple times. The Leaders requested that arrangements be made for their engagement with the EU at the highest political level in order to facilitate the conclusion of negotiations soon. Fisheries remain the key issue of contention in the negotiations and Ministers and Leaders have continued to urge the EU to show flexibility in the EPA negotiations, especially on fisheries matters.

World Trade Organization (WTO)

The WTO is an international Organisation mandated to create and administer rules to make international trade as free and fair as possible. Its main functions are to facilitate negations for trade rules, provide a mechanism for settling trade disputes and monitor member’s trade policy policies to ensure they are consistent with WTO rules.

Vanuatu completed formalities to join the WTO in July 2012 to become its 157 member on 24 August. It has committed to fully apply all WTO provisions and obligations from the date of accession, except for a short transition period to meet intellectual property obligations and a 4-year transition period to set up systems for publishing trade-related information.  Certain very high tariffs will enjoy transition periods of 1-3 years. 

With support from the WTO Secretariat, a Vanuatu WTO Reference Centre was established in February 2013.  In pursuing the MCTIT’s goal to mainstream trade, the WTO Reference Centre Programme will enable Government officials, private sector and academic communities of Vanuatu to obtain trade-related information resources on the WTO Internet site, in electronic versions on CD-ROMs developed by the WTO, as well as trade-related publications, and to facilitate access and use of eLearning programmes of the WTO. A designated trade officer has been was appointed as Manager of the Reference Centre and is available to provide the required assistance. 

Current Status

The 9th Ministerial Conference (MC-9) took place in Bali Indonesia, between 3-5 December 2013.  After three days of intensive consultations, WTO Members managed to reach an agreement on the Bali Package which comprised ten Ministerial Decisions on Trade Facilitation, Selected Issues in Agriculture and Development and LDC Issues. With respect to Trade Facilitation, it is estimated that the agreement will increase global welfare by almost $1 trillion. The Agreement will simplify customs procedures, reduce red tape and facilitate the cross-border trade between WTO Members. As a developing country, Vanuatu has a number of flexibilities. It will have to classify its obligations under the Agreement into three categories. It will have to implement commitments in Category A immediately after the entry into force of the Agreement (tentatively scheduled around July 2015 – but now likely to miss this mark); commitments in Category B which will have to be implemented after a transitional period and commitments under Category C after it has received technical assistance and capacity building support from donors.


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