Trade defense pacts protect local businesses

NEO SENOKO

MASERU – Capacity development in the area of trade defense instruments is an essential element of Economic Partnership Agreements (EPA) for smoother and easier implementation of the SADC EPA safeguards, the Ministry of Trade and Industry has said.

The ministry said this while opening a two-day stakeholder workshop on the SADC EPA safeguards yesterday.

The European Union (EU) SADC EPA Economic Partnership Agreement came into force in October 2016 after its signing by six SADC countries and the EU.

THE safeguard measures, which form part of the overall agreement, are a temporary restriction of fairly traded products to protect a specific domestic industry from sudden increase in imports which can cause serious injury to the domestic industry of the importing country.

In the SADC EPA the safeguards include, but are not limited to, the general bilateral safeguards, special agricultural safeguards, food security safeguards as well as infant industry safeguards.

“Our purpose here today is to learn about these safeguards and when they can be used under the agreement as well as who can use them. At the end of the workshop we should be able to articulate these safeguards in order to benefit us as a country,” said Soaile Mochaba, the Principal Secretary in the Ministry of Trade and Industry in an interview with Public Eye.

It was against this background that SADC secretariat contracted TRALAC to raise awareness on the application of trade remedies to a broader stakeholder spectrum comprising the private sector and assess national regulatory needs in the area of trade remedies for other SADC EPA member states including Lesotho.

TRALAC, through its expertise, therefore facilitated a two-day stakeholder workshop in Lesotho. The workshop which is focused on creating awareness about the SADC EPA safeguards started yesterday and ends today.

Lesotho has signed and ratified the Economic Partnership Agreement (EPA) and as such is fully committed to the obligations provided for under this agreement, in particular, the trade defense instruments.

As a result, the country has taken an initiative to create awareness about the available safeguards instruments within the local business community for easier understanding in case there is a need to implement some of them.

“We are already in the SADC EPA agreement, what we are doing now is just to create awareness so that our business community understands some of this clauses and other remedies so that it does not become a problem if they are imposed on us or we have to implement some of them.”

“The technicality and complexity of this area cannot be overemphasised. National legal and institutional frameworks are the basic requirements for trade remedy actions,” Mochaba said.

These instruments are becoming increasingly important for the survival of the African domestic industries and producers which, according to the Ministry of Trade, remain the main employer and contributor to the GDP growth in African economies.

According to Kealeratse Dintle, who is a member of the SADC EPA unit, implementation of any trade agreement has both the positives and negatives.

The positives, according to her, may be in the sense that there will be more goods coming into the country and in that regard the country would benefit because they now have a bigger basket of goods to choose from and it may also mean that prices may go down.

“The negatives may be in the sense that there is now competition that may not be good for the local industries,” Dintle said during the workshop yesterday.

For that reason, the SADC EPA agreement has catered for such.

In the event that competition is stiff for locals, the agreement has allowed for trade remedies and these includes the safeguards portion of the agreement.

Generally, safeguards need to be applied on a non-discriminatory basis according to the Trade Law Centre (TRALAC). The measures need to be applied on the specific import product irrespective of the source.

However, regional trade agreements allow for an exception to this rule in the form of bilateral or regional safeguard measures which are only applicable between the countries which are party to the agreement.