EU executive endorses farm aid plan for Africa

from Reuters

Here are some more details on the EU's newly proposed food fund. It is already being welcomed by NGO's that work in Africa. - Kale

By Jeremy Smith

BRUSSELS - The European Commission backed a plan on Friday to give 1 billion euros to farmers in Africa next year to help tackle high food prices and boost output, despite opposition by many EU states.

The EU cash, largely the result of underspending and leeway in the bloc's massive agriculture budget, comprises 750 million euros earmarked for 2008 and the remainder for 2009. This year's amount could be given retrospectively from mid-June.

At least eight EU member countries, including Britain, Sweden and the Netherlands, have questioned the legality of the scheme but have not challenged the merit of the idea.

EU ministers and the European Parliament, which has also voiced doubts about using unspent EU farm funds, will have to agree to the plan before it can enter into force. The Commission would like cash to start flowing in early January 2009.

"There's a fairly broad consensus on the need to act here, given the crisis which is taking place," Commission spokesman Johannes Laitenberger told a daily news briefing.

"In the Commission's opinion, this is the most efficient and most rapid instrument that could be used."

If approved, the money will be channelled to developing countries through international or regional organisations, such as the United Nations and World Food Programme.

Four areas of financial support are envisaged, the main two being to improve access to farming "inputs" like fertilisers and seeds and ways to improve agricultural capacity and production.

But the most difficult debate may come after the summer: how to set eligibility criteria for recipient countries and how much cash will be allocated by country. Those negotiations should be concluded by December, the Commission says.

Criteria are expected to include how much food a country produces to feed itself, its political stability and social vulnerability, its level of food price inflation and reliance on food imports -- including shipments of food aid.

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EU proposes $1.6 B for food

from the Winnipeg Sun

The EU is making a move to help in the global food crisis. They have asked member nations to ratify this proposal by November. - Kale

BRUSSELS, Belgium — The European Union is proposing a $1.6-billion, two-year emergency fund to help poor countries cope with the global food crisis.

European Commission President Jose Manuel Barroso says the fund will aim to help mostly African nations and stabilize supply markets.

The fund has been put together from cash that has gone unspent in this year’s EU farm budget.


The EU Commission will only give out cash to countries that are found to be the most reliant on food imports and have been hardest hit by food price inflation.

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EU Renews Its Intentions

from IPS News

By David Cronin

BRUSSELS, European Union governments have resolved to ensure that international objectives on reducing extreme poverty are realised, but have backed away from devising concrete plans for increasing the amount of aid that they give to poor countries.

During a summit in Brussels Jun. 19-20, the EU's presidents and prime ministers agreed an 'agenda for action' against poverty. The summit reiterated their commitment to devoting 0.56 percent of their collective national income to development aid by 2010, rising to 0.7 percent by 2015. As a result, aid should double to 66 billion euros (103 billion dollars) within the next two years, with half of the increase going to Africa.

The leaders also said that all of the EU's 27 governments are "encouraged to establish their indicative timetables", outlining how they plan to make good on pledges that most of them signed up to in 2005.

Anti-poverty activists argued, however, that the 'agenda for action' was too weak and that explicit legally binding programmes for boosting aid are needed. Concord, a group that binds together most of the well-known aid agencies in Europe, complained that far from increasing aid, several EU governments cut the amount they gave to the poor over the past year. Without a dramatic improvement, the EU is likely to provide 75 billion dollars less in aid than it had promised between 2005 and 2010, the group estimates.

"A number of European governments have shown real commitment to keeping their promises on aid by setting timetables on how it should be delivered," said Jasmine Burnley, a spokeswoman for Concord. "But the majority are dragging their feet. This lack of commitment from some is pulling down the performance of Europe as a whole and compromising the EU's credibility on development."

The EU's leaders argued that the United Nations Millennium Development Goals for dramatically reducing the most extreme forms of poverty by 2015 can be attained in all of the world's regions "provided that concerted action is taken immediately and in a sustained manner."

Kumi Naidoo, chairman of the Global Call to Action Against Poverty suggested, though, that the EU had produced little more than a political statement, which may yield few tangible results.

"The agenda for action was designed to demonstrate Europe's leadership on poverty reduction," he said. "But the absence of annual timetables to guarantee timely aid provision really weakens it. We know that a lack of predictability in aid flows can severely impact on the poor by making it impossible for governments to pay teachers, nurses and other vital professionals."

In an analysis published this week, Debt AIDS Trade Africa (DATA), an organisation led by the Irish rock star Bono, berated three of the four European members of the Group of Eight (G8) top industrialised countries for not honouring pledges that they made during a summit at the Gleneagles G8 summit in 2005. Of the four -- Italy, Germany, France and Britain -- only Britain appears likely to come close to meeting its targets for 2010.

Pledges made to Africa are being broken, the organisation suggested. France's assistance to sub-Saharan Africa fell by 66 million dollars between 2006 and last year, for example.

Desmond Tutu, the South African bishop and Nobel Peace Prize winner, wrote the introduction to the DATA study, stating: "Intentions are one thing, follow through is another, and I am deeply worried that France, Germany and Italy are not going to keep the promises they made to Africa in 2005, because then all of Europe will be behind."

Even though EU governments implied that the fight against global poverty should be considered an urgent matter, this and all other issues on their summit agenda were eclipsed by Ireland's rejection of the Lisbon treaty a week earlier.

Because all 27 countries have to ratify the treaty before it can have legal effect, the vote against the treaty in the Irish referendum has called its future into question.

EU governments stated that despite the Irish 'No', the ratification process should continue in other member states. So far, 19 national parliaments have approved the treaty. Ireland was the only country to directly ask its voters their opinion about it.

Nonetheless, the leaders acknowledged that the treaty is in difficulty in the Czech Republic, as well as in Ireland. Ratification has been postponed in Prague because the country's Senate has asked for a court ruling on whether or not it complies with the national constitution.

And while Britain become the 19th country to endorse it via parliament this week, a High Court judge has called on British Prime Minister Gordon Brown's government to delay on formally ratifying it until a legal bid designed to force a referendum is assessed. The bid has been mounted by businessman and supporter of the opposition Conservative Party, Stuart Wheeler.
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EU, Latin American leaders meet on trade, climate

from Reuters

By Helen Popper

LIMA (Reuters) - Political differences loomed over a summit of European and Latin American leaders in Peru on Friday, threatening to undermine their efforts to fight poverty and global warming.

Leftist Bolivian President Evo Morales differed with his regional counterparts over free trade in the run-up to the meeting, while Venezuela's Hugo Chavez ratcheted up tensions in a conflict with neighboring Colombia.

Free trade proponents like Peru are losing patience with skeptics like Bolivia's Morales, who accused Peru and Colombia this week of trying to exclude his nation from talks between the European Union and Andean countries.

"We can advance at different speeds, but let's advance," Peruvian President Alan Garcia said on Thursday, saying his country should be allowed to move faster with the EU.

Morales, a former coca grower, fears free trade deals could hurt peasant farmers in his impoverished country. "We want trade, but fair trade," he told reporters in Lima.

The EU is also holding negotiations with Mercosur, led by Brazil and Argentina, and Central American countries.

German Chancellor Angela Merkel, one of the first leaders to arrive for the summit, said after meeting Garcia that the EU was "open, and willing to make the path easier" on trade.

Merkel made no mention of a spat with Chavez, who this week called her a political descendant of Adolf Hitler for implying he had damaged relations between Europe and Latin America.

Chavez frequently insults conservative leaders, especially U.S. President George W. Bush. At a summit in Chile last year, Spain's king told him to "shut up."

Chavez is also embroiled in a dispute with Colombia that raised the specter of war in the Andean region in March. Colombian President Alvaro Uribe accuses him of supporting the leftist FARC guerrillas, and soon before leaving for Lima, Chavez said he was reviewing diplomatic ties with Bogota.

Such feuds could dominate the fifth such gathering of leaders from Europe, Latin America and the Caribbean.

They may also struggle to find common ground on how to fight cocaine trafficking, as well as the use of food crops to make renewable biofuels as an alternative to fossil fuels.

Brazil is an advocate of the so-called greener fuels, but many poor countries blame them for pushing up food price.

However, the poor nations are increasingly worried about climate change and say rich states must cut carbon emissions.

Peru created an environment ministry this week to help it cope with the impact of rising global temperatures, which are melting its Andean glaciers. Peruvian delegates to the summit will push for more concrete measures to combat climate change.

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EU, Latin American Leaders Voice Concern over Food Prices

from Deutsche Welle

The EU-Latin America-Caribbean summit stressed in its final declaration Friday, May 16, in Lima that participants were "deeply concerned by the impact of increased food prices," citing troubled Haiti as an example.

"We agree that immediate measures are needed to assist the most vulnerable countries and populations affected by high food prices," the Lima Declaration said.

European Union Foreign Relations Commissioner Benita Ferrero-Waldner said in the Peruvian capital that soaring global food prices constitute "a regional challenge." The EU has approved a package worth 117.25 million euros ($183 million dollars) for food aid around the world, she said.

Signed by 60 countries at the end of the meeting, the declaration focused on the fight against poverty and climate change and expressed support for Haiti.

Focus on need in Haiti

Haiti is the poorest country in the Americas, with 70 percent of its nearly 9 million people living in poverty. Six people were killed and a further 268 injured last month in Haiti during riots over high food prices, and the prime minister was forced to resign over his handling of the crisis.

Inter-American Development Bank (IDB) President Luis Alberto Moreno, who also attended the summit, noted that his institution has granted loans for $27 million to Haiti to keep down food prices and has created a special fund to improve agricultural productivity, strengthen social networks and develop new technologies.

The Lima Declaration stressed "the efforts by the Haitian government and people to revitalize the state institutions and combat poverty, inequality and social injustices," while acknowledging the need for "urgent and effective continued action by the international community on behalf of rehabilitation and development in Haiti."

Call for distribution of wealth

Spanish Prime Minister Jose Luis Rodriguez Zapatero called on Latin America to implement "fairer" income distribution policies.

"Overcoming poverty, inequality and exclusion is crucial for the attainment of social cohesion, for sustainable development and for the effectiveness of our bi-regional partnership," the declaration stressed.

"There has to be an income distribution policy that is fairer than the current one in Latin America, and a social policy of cooperation for development that tackles basic structural problems," Zapatero said. "Social spending is also productive spending. Social investment generates wealth."

Economy linked to climate change

Peruvian President Alan Garcia addressed the other intended focus of the meeting, climate change, and mentioned an initiative to tax oil and natural gas to raise money to pay for reforestation.

The final declaration stressed that "environmental degradation and climate change seriously affect" economic growth, "hitting the poor hardest and seriously threatening the prospects" for the world's future.

Of the delegations present at the summit at the National Museum in Lima, 37 were lead by prime ministers or heads of state. Some key European leaders were conspicuously absent, including French President Nicolas Sarkozy and prime ministers Gordon Brown of Britain and Silvio Berlusconi of Italy.

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EU Ponders Next Move On Trade Deals

from All Africa

The Monitor (Kampala)

By Peter Nyanzi
Brussels

The European Union is contemplating the way forward following the reluctance of the majority of African, Caribbean and Pacific (ACP) countries to sign the Economic Partnership Agreements (EPAs) they have been negotiating, five months after the expiry of the December 31 deadline set by the World Trade Organisation.

EU officials told a group of ACP journalists attending a workshop on EPAs in Brussels recently that there was need for a consensus "as soon as possible" with the regional blocs and individual States that had initialled interim agreements and those had completed rejected them.

Eight years ago when negotiations on EPAs began, it was with the best of intentions - to put in a place a fair trade regime that would go beyond just being compatible with World Trade Organisation (WTO) rules; to encompass poverty alleviation, development and regional integration in the ACP countries.

But as the WTO's December 31, 2007 deadline drew close, there was angst and despair as the whole process became increasingly bogged down in a quagmire of controversy and acrimony.

Not surprisingly, only less than half of the 78 ACP countries had initialled the agreements at the close of the year. Of the six regions, only the Caribbean has concluded a full EPA.

The East African region signed an interim agreement on November 23.

Later in June or July, the Commission will present both the interim and full EPAs to the European Parliament for approval.

Following high-level consultations with the concerned parties, the EC has drawn up a number of issues for which it seeks consensus over the next 12 months with the negotiators from the various regions involved in the EPA talks.

Intense lobbying is rife in Brussels, the European capital by civil society actors and lobby groups, which want the whole process revisited.

But Mr Peter Mandelson, the trade commissioner and other officials, blamed the impasse on "misinformation" and "misconceptions" being perpetuated by some civil society groups and some Members of the European Parliament (MEP) such as Ms Glenys Kinnock, who denies the claims.

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EU and Japanese Leaders Call for Action on Food Prices

from Deutsche Welle

European and Japanese leaders said urgent action was needed to tackle soaring food prices, which threaten to increase poverty and damage the world economy. The World Food Program called the crisis a "silent tsunami."

Top EU leaders, including European Commission President Jose Manuel Barroso and Japanese Prime Minister Yasuo Fukuda, voiced their worries about the prices of food, oil and other commodities on Wednesday, April 23.

"Summit leaders noted with strong concern the trends of high prices of natural resources and commodities, in particular, prices of food and oil, which could slow down the growth in [the] global economy and have negative effects on developed and developing countries," they said in a joint statement following their summit in Tokyo. The statement was also signed by Prime Minister Janez Jansa of Slovenia, whose country currently holds the EU presidency.

The world leaders also noted the acute effects soaring prices are having on developing nations' attempts to overcome poverty.

Many now on verge of hunger

The United Nations' World Food Program has called rising food prices a "silent tsunami" that has pushed an extra 100 million people to the brink of hunger.

"This is the new face of hunger -- the millions of people who were not in the 'urgent hunger' category six months ago but now are," WFP Executive Director Josette Sheeran said in a statement on Tuesday.

Also on Tuesday, the European Commission announced it would offer another 117.25 million euros ($185.6 million) in food aid to lessen the impact of rising food prices on the world's most vulnerable people. That announcement came after the commission's biggest food aid package -- 160 million euros -- was pledged in March.

Barroso said a significant drop in international development aid for a second straight year in 2007 exacerbated the problem.

"When you add to this negative developments that we have watched recently -- the recent elements concerning food prices -- we have reasons to be sincerely concerned," Barroso told reporters in Tokyo.

He added that the global community needed to be mobilized to renew their commitments of development aid, particularly for Africa.

Immense food price hikes

Food prices have risen sharply since the end of 2007, triggered in part by a growing population, increasing consumption in emerging economies such as China and India, more frequent and intense droughts and floods due to climate change, and by the popularity of biofuels as oil prices soar.

High prices for stples, such as rice, have led to riots and protests in countries from Haiti to Indonesia.

Japan, which imports more than half its food, is particularly concerned about spiraling food prices and said it would place the issue on the agenda at the summit of the Group of Eight rich nations, which it will host in July.

Fukuda said he and EU leaders had also agreed to raise the food issue before the World Trade Organization.

"Convergence" on climate protection

Barroso, Fukuda and Slovenia's Jansa also focused their attention on the climate during their talks in Tokyo, with the EU and Japan agreeing that a "highly ambitious and binding international approach" was needed to replace the Kyoto Protocol when it expires in 2012.

Barroso called the joint statement a "convergence" in stances taken by the EU and Japan.

"What we reached today was very important," Barroso said. "There must be binding targets."

However, the Japan-EU statement did not announce specific figures for binding cuts of greenhouse gas emissions blamed for global warming.

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EU urges members to meet Millennium aid pledges

from Reuters South Africa

By David Brunnstrom

BRUSSELS (Reuters) - European Union states must meet pledges to boost aid to poor countries, the EU executive said on Wednesday, warning that missing U.N. goals would be a disaster for developing nations and threaten global stability.

Progress has been made towards the United Nations Millennium Development Goals, the European Commission said, but each year 11 million children die of curable illnesses, one person in four lacks access to drinking water, 114 million children have no primary education and 584 million women are illiterate.

"Missing the Millennium Development Goals would be a disaster for developing countries, a failure for Europe, and a potential threat to global stability," the Commission said.

"With seven years remaining, the message for 2008 is that the Millennium Development Goals can be achieved, but for this to happen, increased political and public support will be needed," the EU executive said in a statement.

The Commission called on EU states to deliver on pledges to boost development aid to 0.56 percent of Gross National Income (GNI) by 2010 and 0.7 percent in 2015, terming this vital to containing problems like migration, security and climate change.

It called on each of the 27 EU states to draw up financial plans showing year by year increases to meet the goals.

The European Union is the world's biggest aid donor, committing more than 46 billion euros in 2007, but the total amount fell about 1.7 billion euros from 2006, enough to have financed 4,500 schools or 1,200 hospitals.

"SERIOUS FAILURE"

Aid and development Commissioner Louis Michel last week called this a "serious failure".

The Commission urged more effective aid by avoiding duplication of effort, help to developing countries to use biofuels to fight poverty, and steps to help limit brain drains, particularly in health, education and research.

"Fundamental principles of aid effectiveness are not yet being respected," it said, adding that it would put forward proposals to improve the situation state by state.

It called for 2 billion euros to be allocated by 2010 to the Aid for Trade programme aimed at helping poorer countries take advantage of export opportunities, with special focus on African, Caribbean and Pacific states.

Commission President Jose Manuel Barroso said 2008 must be a year of action not just words. "If we want to remain credible, we have to deliver on our promises" he said in a statement.

A report last week by the 22 member Organisation for Economic Cooperation and Development said development aid from all the world's biggest donors fell last year, largely due to the end of big debt relief packages.

In 2000, 189 U.N. members agreed goals aimed at eradicating poverty, promoting human and social development and protecting the environment.

In 2005 EU heads of state agreed targets for 2015 of a halving of extreme poverty, access to primary education by all boys and girls and improved health standards.

Aid reached 0.38 percent of the EU's GNI last year, below an interim target for 2006 of 0.39 percent -- which the bloc did fulfil in 2006.

The European Commission estimates Official Development Assistance amounted to 93 euros per EU citizen, compared to 53 euros per person in the United States and 44 euros in Japan.

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The EU-Africa Lisbon Summit

from All Africa

Accra Mail (Accra)

ANALYSIS

By David Miliband and Douglas Alexander
Accra

British Foreign Secretary and Minister for International Development respectively Globalisation is increasing interdependence. It is creating shared interests that demand co-operation between countries and regions.

From climate change and economic growth, to conflict and terrorism, Europe and Africa's futures are intertwined. We must use this weekend's EU-Africa Summit in Lisbon to strengthen our relations and create a better future for the next generation.

The UK has in the last ten years made massive efforts with many African countries to support African-led development. From aid to trade to debt relief to education and health we are committed to put our money and people behind a transformation in African fortunes.

Whether it be £6bn in trade with South Africa, our efforts to restore peace to Sierra Leone, or the £700m of aid announced last week to fight poverty in Uganda, we are investing more in African countries than ever before.

But we also know that the EU, as a regional player of 27 states, needs to fashion a new relationship with Africa. It can add value. After all it was under the UK Presidency that in 2005 the EU signed up to a strategy for Africa and made commitments to support peace and security, sustainable development and good governance.

In the Democratic Republic of Congo for instance the EU provided support for last year's landmark presidential elections, and we are supporting reform of the Congolese armed forces, police and justice system. The EU is Africa's biggest donor, helping to build the schools, health clinics and infrastructure to help Africa thrive. And we are playing a more active role in tackling violent conflict, both by supporting the AU and UN, and directly by despatching European troops for instance to Eastern Chad.

We want to strengthen this co-operation. The EU and Africa should be more ambitious about what we can achieve by working together. This is what the summit is about. We want to see progress in five key areas.

First, on the Millennium Development Goals. Seven years have passed since world leaders pledged to "spare no effort" to free men, women and children from extreme poverty. Seven years remain before the 2015 deadline. Some progress has been made. Debt relief and aid increases helped put 20 million more African children into school between 2000 and 2004. But we are not moving fast enough. We want the Summit to agree a new partnership on the MDGs. The EU must live up to its promises on financing and accelerate efforts on health, education and economic growth. African Governments, in turn, must redouble efforts to deliver public services, building and improving schools and hospitals, and providing access to water and sanitation.

Second, more joint efforts on conflict prevention and resolution. It is in all our interests to work together on this. As the wars in the Great Lakes have shown, conflict does not respect national boundaries. The AU is taking responsibility for conflict in Africa. It has developed an African-owned vision for early conflict warning, mediation and peacekeeping. It now needs to be made fully operational. The EU is already helping. We have helped fund the African Union mission in Darfur to the tune of $650m. But we can and should do more to share expertise, build African capacity and provide more predictable funding.

Third, climate change. This is potentially the biggest threat to peace, security and development in the twenty-first century. We have already seen the devastating effects in Darfur, where friction over water shortages have played a role in turning the age-old struggles into violent conflict. Africa has a real stake in negotiations to address climate change following the end in 2012 of the first commitment period of the Kyoto protocol. It is important to work together on this. Europe and Africa's national and regional plans should take account of the need to adapt and cope with climate change. And there is much more that we can do together to better manage our natural resources and environment.

Fourth, governance and human rights. Progress has been made. Since 2002 Nigeria's Economic and Financial Crimes Commission has recovered US$ 5bn of stolen money and assets. The African Peer Review Mechanism is an important tool to review governance between African countries. We want the EU to do what it can to support this, and to continue to provide its significant assistance with election monitoring.

Fifth, the Commission for Africa argued that Africa needs better trade deals and more aid to support the continent's ability to trade. We want the Summit to recommit to the Doha Development Round and express support for the EU's "aid for trade" strategy.

We welcome the Economic Partnership Agreements that have been signed by several African countries, and hope that others will follow before the end of this year, providing better access to EU markets and thus helping Africa to trade its way out of poverty.

We have been arguing for these priorities in discussions in the run-up to the Summit. However, the Prime Minister will not be attending - because of our distress at the tragedy unfolding in Zimbabwe, which affects people of all races, which we believe can be traced back directly to Robert Mugabe - the only African leader with an EU Visa Ban against his name.

It would be wrong for the UK Prime Minister - or other senior members of the British Government - to stand by his side. This man's misrule has brought starvation to a country that was once the breadbasket of Africa. In the face of his brutal tyranny and abuse of human rights, a third of the population have fled. Those who remain face a daily struggle for survival - and the lowest life expectancy rates in the world. The idea that we pretend this isn't happening is not right.

A solution to Zimbabwe's problem can't come soon enough for its people. We back President Mbeki's efforts to help negotiate a process towards free and fair elections. For these to happen we will need a repeal of the draconian security laws and the violence against the opposition, a free press, independent monitors, and an independent electoral commission. We stand ready to support Zimbabwe, if freedom returns, to rebuild its shattered economy and infrastructure

Working together, the EU and Africa will play a significant role in shaping the world for the next generation. This summit is an opportunity to take decisions that will help provide security and prosperity for our peoples. The UK will play its part in making sure this important partnership is strong, productive and lasting.

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EU Reaches Interim Free Trade Pact With 5 East African Nations

from Canadian Business

Constant Brand

BRUSSELS, Belgium (AP) - European Union negotiators concluded an interim free trade pact with five east African nations, EU officials said Tuesday.

The deal is part of the EU's efforts to reach new aid-and-trade deals with members of the 78-nation Africa-Caribbean and Pacific group before a Dec. 31 deadline set by the World Trade Organization.

The WTO ordered the EU to bring its 30-year-old preferential trade ties Europe's former colonies in line with world trade regulations after it ruled they were unfair to nations excluded from the arrangement.



The latest deal, which applies to Kenya, Unganda, Tanzania, Rwanda and Burundi, is only a partial one, EU officials said.

The agreement focuses on opening up bilateral trade links with these countries. But at this point it will apply only to goods, not to services, as was foreseen when the EU began trade talks with ACP group of nations more than five years ago.

EU Trade Commissioner Peter Mandelson said the agreement "will prevent trade disruption and allow the EU to open its markets fully to exports" from the five nations as of Jan. 1.

A similar interim deal was reached on the weekend with four southern African nations, Botswana, Lesotho, Swaziland and Mozambique.

That deal excluded Angola, South Africa and Namibia, which have said they do not want to participate in the new Economic Partnership Agreements, or EPAs.

Negotiations are still ongoing with four other regions to conclude EPAs, including the Caribbean, the Pacific, western Africa and central Africa.

Anti-poverty groups like Oxfam have accused EU nations of trying to force the new trade pacts on the poor nations, which they argue are ill equipped to open up their fragile national markets to competition from European goods.

Mandelson said last week he still hoped to conclude negotiations with the other groups by the end of the year.

The EU trade chief has warned that nations which do not reach accords with the EU by January will automatically lose the preferential privileges that have been in place for three decades and receive only limited access to EU markets under existing world trade rules.

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Biofueling Poverty?

from Wired

By Chuck Squatriglia

A requirement by the European Union that biofuel meet 10 percent of member states' fuel needs by 2020 could mean disaster for the world's poor as suppliers rush to meet demand, one of the world's leading aid agencies warned today.

The only way the EU will be able to meet that target, Oxfam International notes, is to import biofuels refined from sugar cane and palm oil produced in developing nations. While that could ease poverty by creating more agricultural jobs, the agency said, it is more likely to result in people being pushed from their land and crops like corn and soybeans being used for fuel instead of food.

"In the scramble to supply the EU and the rest of the world with biofuels, poor people are getting trampled," Robert Bailey, an Oxfam policy advisor, said in a statement. "The EU proposals as they stand will exacerbate the problem. It is unacceptable that poor people in developing countries should bear the cost of questionable attempts to cut emissions in Europe."


Find out what the EU says after the jump...

The 27 member states of the EU insist that the 10 percent target must be reached in a sustainable manner, but Oxfam says there are no standards dictating the social or economic impact of the policy and no safeguards to ensure that any standards that might be forthcoming will be enforced.

To ensure the world's poor are not harmed by the policy, Oxfam has suggested the EU conduct annual checks on the environmental and social impacts of the policy, and change the 10 percent goal biofuel production is proving harmful.

EU officials said they are drawing up economic, social and environmental standards to ensure its green fuel plan does not harm fuel producing nations. To meet the 10 percent benchmark, the European Commission has said, 20 percent of the EU's biofuel production will come from imported crops.

It is a pressing issue, Oxfam said, because evidence suggests biofuel crops could be growing on as much as 2.1 million square miles -- an area more than 10 times the size of France -- in the developing world within 20 years. As we reported earlier this week, the Center for Sustainability and the Global Environment says Malaysia, Thailand, Colombia, Uruguay and Ghana are poised to become the world leaders in biofuel production. And the United Nations estimates that 60 million people worldwide face the threat of being moved aside to make way for biofuel production.

Jean Ziegler, the U.N.'s independent expert on the right to food, recently called for a five-year moratorium on biofuels, saying, "It is a crime against humanity to convert agricultural productive soil into soil which produces food stuff that will be burned into biofuel." He argued converting crops to fuel is driving up food costs and poor nations could become unable to feed their people.

The U.N. Food and Agriculture Organization subsequently called Ziegler's comments "regrettable." And President Luiz Inacio Lula da Silva of Brazil has urged African leaders to "join the biofuel revolution" and strengthen the world's poorest economies while easing global climate change.

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Kenyan farmers ask court to block proposed EU trade agreement

from Yahoo News

NAIROBI (AFP) - Kenyan small scale farmers on Thursday asked the high court to block a proposed new trade agreement with the European Union that activists warn could strangle poor economies and industries.

The farmers said the new tariff system, the Economic Partnership Agreements (EPAs) set to replace a current preferential arrangement, will condemn hundreds of thousands in Kenya into joblessness and deeper poverty.

Kenya is among 78 African, Caribbean and Pacific (ACP) countries enjoying special access to the EU market, but the World Trade Organisation has ruled that the deal must end by January 1, 2008 to pave the way for free markets.

"The EPAs would unfairly obligate ... (ACP) countries to open their borders to duty and tariff-free goods and services from Europe, with the consequence of undermining the right to development," they said in court papers.

If they take effect, the EPAs "will contravene the petitioners (farmers) rights and freedoms; including the rights to life, to work, to earn a living and rights to basic services, such as provision of water, security, education, roads and infrastructure," it added.

The case was referred to the country's chief justice for direction.

Kenyan courts are empowered to block the country from signing bilateral and multilateral deals if they are deemed to affect the rights of its subjects.

If EPA fails to take effect in January, then somewhat wealthier African nations, including Kenya, South Africa and Nigeria, will automatically face a specific band of tariffs.

Nonetheless, 40 of the ACP countries considered least developed will still benefit from the preferential trade agreements.

In a recent statement, the ActionAid organisation charged that Europe's "use of strong-arm trade politics will deny food rights and undermine good governance in the world's poorest countries."

The preferential trade pacts between Europe and the ACP were initially designed to ensure a steady flow of supplies from former colonies, but Europe is now pushing to get a wider access to ACP markets.

Many poor countries argue that they will no longer be able to compete if they lose their special tariffs on exports to EU countries.

EU Trade Commissioner Peter Mandelson has upped the pressure on ACP countries to find a common position and press on with the negotiations to ensure there is a solution.

With the year-end deadline looming ever larger, the EU sought in April to boost the negotiations with an offer to scrap all tariffs and quotas on ACP countries' exports with the exception of sugar and rice.

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West Africa to miss EU trade partnership deadline

from Reuters Alert Net

By Peter Murphy

ABIDJAN, Oct 5 (Reuters) - West Africa will miss a Dec. 31 deadline to sign a new trade partnership with the European Union and hopes to keep its preferential commercial privileges for up to two years while it negotiates, a West African official said.

Ministers from the Economic Community of West African States (ECOWAS) were meeting on Friday in Ivory Coast to agree a common approach ahead of talks later this month with the EU over signing of the Economic Partnership Agreement (EPA).

These EPAs are set to replace trade arrangements giving African, Caribbean and Pacific states preferential access to the EU market. These preferences have to be scrapped to conform with World Trade Organisation (WTO) principles.

Anti-poverty campaigners say this shift to the EPA will expose fragile industry in poor African nations to crushing competition from more modern, efficient EU-based firms.

But Brussels, which is pushing the Dec. 31 deadline, says it will boost their economies and attract investment towards them.

"West Africa isn't ready to sign such an agreement by 31 December," Ablasse Ouedraogo, special adviser for trade negotiations to the ECOWAS President, told Reuters late on Thursday before the start of the West African meeting.

While EU chiefs were pushing for an interim agreement, ECOWAS ministers wanted to pursue a legal derogation that would postpone the introduction of the EPA to conform with WTO rules.

"We will then have the time to continue the (EPA) negotiations before the WTO can take action (against us)," he said, adding it "should take less than two years" for the West African bloc to prepare to sign the deal.

COMPROMISE

"It is the most logical and realistic way," he said, speaking in Ivory Coast's economic capital Abidjan.

EU officials have refused to countenance a postponement and have urged African officials to knuckle-down to negotiations.

"It is a WTO imposed deadline. We are governed by international rules and we intend to stick to them. Our waiver expires at the end of this year and we need a successor regime by the end of this year," Peter Power, spokesman for EU Trade Commissioner Peter Mandelson, told Reuters in Brussels.

Ouedraogo said he was confident the two trading blocs would reach an agreement that would avoid any disruption to trade with the EU, West Africa's No. 1 trading partner.

"There won't be any worst case scenario. As much as Africa needs the EU, the EU needs Africa. We will find a compromise to enable exchanges to continue that will reinforce the partnership and cooperation between West Africa and the EU," he said.

Pacific countries have made more progress and this week agreed with the EU to seek a pre-EPA interim deal that would include a timetable for cutting tariffs on goods, rules of origin and safeguard mechanisms to slow sudden surges of imports. (Additional reporting by Bill Schomberg in Brussels)

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Anti-poverty Gps Protest Over EU,Ex-colonies Free Trade Talks

from Nasdaq

BRUSSELS (AP)--Anti-poverty activists demonstrated outside European Union headquarters Thursday to demand a halt to free trade negotiations between the E.U. and former European colonies that they argue will undermine development in poor countries.

A coalition of aid groups and anti-poverty advocates, including Oxfam and Action Aid, said five years of talks between the E.U. and members of the 78- country Asia-Caribbean-Pacific - or ACP - grouping had to be halted because they offered poor nations little to no benefit.

Campaigners stacked boxes representing E.U. goods in front of the E.U.'s external relations and trade department to protest the negotiations.

"We think that this agreement, which is going to open these ACP countries' markets to European products is going to cause serious industrial and agricultural problems in these countries," said Kwaku Acheampong from Ghana, who works for the Belgian-based aid group Fund for Development Cooperation.

He said the E.U. would use the pacts to unfairly dump subsidized agricultural goods on African markets, making it impossible for local farmers to compete.

"They should pay more attention to development issues," Acheampong said.

E.U. Trade Commissioner Peter Mandelson has appealed to ACP countries to come to an agreement on the so-called Economic Partnership Agreements by the end of the year or face possible import tariffs.

Mandelson argues the new regional pacts are needed to overhaul the E.U.'s special trade ties with Europe's former colonies because they violate world trade rules. The World Trade Organization has set a Jan. 1 deadline for the E.U. to come to a new settlement with the ACP group of countries, because older trade deals are unfair to non-ACP members.

In a letter to protesters, Mandelson and E.U. Development Commissioner Louis Michel acknowledged the negotiations were difficult but said stopping the talks would do more damage.

"Calling for an end to EPA negotiations when there is no credible alternative is playing poker with the livelihoods of those we are trying to help," Mandelson and Michel said.

E.U. officials acknowledged that old rules allowing preferential access to E.U. markets combined with billions of euros in aid has done little to spur development since the E.U. set up special trade and aid ties with the grouping in 1975.

Negotiations have stalled over African nations' fears that they aren't ready to handle regional trade among themselves or to lose exclusive preferred access for their goods to European markets.

The aid groups were joined by the International Trade Union Confederation, which represents labor unions worldwide. It called on Mandelson to seek an extension to an end-of-year deadline imposed by the WTO to redraft the trade pacts.

In a letter sent to Mandelson, trade union leaders pointed to an E.U. working group review of the negotiations that found "substantial" differences still exist between E.U. and African, Caribbean and Pacific country groupings, including market access, liberalization of sectors and the list of products that can be protected.

"These issues are too important to be dealt with in the last rush," they said.

The negotiations, begun in 2002, are way behind schedule. African countries have balked at E.U. demands that they group into regional trade pacts and drop trade barriers between themselves and with the 27-nation E.U.

Many of the ACP countries are loath to give up more than three decades of privileged access to E.U. markets.

The trade accords foresee gradual market openings in parallel with E.U. funding for good governance and reforms in developing nations to spur trade among them.

Over the past months, Mandelson and Michel have held numerous rounds of talks with the six regional groupings negotiating trade pacts with the E.U. The E.U. wants to reach pacts with the Caribbean, West Africa, East and Southern Africa, Central Africa, Southern Africa, and the Pacific regional grouping.

The ACP nations are mostly ex-European colonies. The E.U. has promised them a doubling of aid to EUR2 billion by 2010.

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Countries Stand Up to EU

from All Africa

Inter Press Service (Johannesburg)

NEWS

By Michael Deibert
Paris

Concern over getting too little in return for what they are being asked to give up has led some African nations to say "no" to some proposals for new trade relations with Europe next year.

Several Eastern and Southern African nations have announced that they will only sign parts of the Economic Partnership Agreements (EPAs) that relate to market access and development. The EPAs have been put forth as successor to the Cotonou Agreement, which expires at the end of December.

The Cotonou Agreement gives 77 African, Caribbean and Pacific (ACP) countries preferential access to European Union (EU) markets. Signed in Benin capital Cotonou in June 2000, the agreement replaced the 25 year-old Lome Convention (signed in the Togo capital).


The Cotonou Agreement was broader in sweep than its predecessor, and set as its objectives "poverty eradication, sustainable development and the gradual integration of the ACP countries into the world economy."

At a regional negotiation forum Aug. 3 to 5 in Port Louis, Mauritius, 16 Common Market for Eastern and Southern Africa (COMESA) countries agreed a strategy to be presented at their next negotiating round in September.

The 16 COMESA nations, represented by no less than five separate overlapping and occasionally competing economic groups, have little choice but to sign on to the market aspects of the new pact in order to maintain preferential access to EU markets and remain compatible with World Trade Organisation (WTO) access rules.

At present ACP members enjoy non-reciprocal trade benefits with the EU -- such as access to EU markets which EU nations do not enjoy with ACP countries -- but these benefits are incompatible with WTO standards.

New trade terms are being renegotiated through creation of WTO-compliant Economic Partnership Agreements (EPAs) that are scheduled to enter into force by the end of 2007. But EPA negotiations have proved difficult, with some countries fearing that their economies will not be able to withstand competition from European goods for years to come.

At a meeting in Brussels in February this year, COMESA negotiators said that potential loss to revenue for many African states across the continent heavily dependant on tariffs could require the EU to provide an additional 2 billion euros in assistance by 2010 if they were to allow Europeans free access. The COMESA members also want the EU to commit more funds to development in exchange for lowering trade duties.

"What Africa lacks is a market for its goods, and there are many barriers amidst which our goods are produced and sold to the EU," says Tiberius Barasa, assistant research fellow at the governance and development programme at the Institute of Policy Analysis and Research (IPAR) in Nairobi, Kenya.

The EU has been accused by some food and trade policy analysts in the developing world of applying "zero tolerance" policies on food import that they say have more to do with protecting Europe's heavily subsidised agricultural and fishing industries than with public safety.

Another mistake, some observers in Africa say, is an insistence on the part of Brussels to make South Africa the standard for assessing the capacity of the whole continent to withstand loss of revenue foreseen through the EPAs.

"This appears to be a fundamental clash of paradigms, and it's very difficult to see how we're going to overcome that," says Brendan Vickers, senior researcher on multilateral trade at South Africa's Institute for Global Dialogue. "The (European) Commission just isn't seeing the bigger picture, and there's a failure to understand that it's not just the South African market, it's the markets of other countries and less developed countries."

South Africa, which has natural resources and a highly developed business and communications infrastructure, maintained per capita gross domestic product of 13,300 dollars last year, despite unemployment that still hovers around 25 percent. The Bureau for Economic Research in South Africa reported this month that South Africa's GDP growth holds steady at 5 percent.

By contrast, Mozambique maintained a GDP per capita of just 1,500 dollars over the same period. In Kenya it was 1,200 dollars, and in Tanzania 800 dollars.

Despite offer of a transitional period for lowering trade barriers, there are fears that any agreement that does not address issues such as production and supply within each individual economy could do more harm than good to bilateral trade.

"If you look at national impact studies that have been made, you find that these reciprocal free trade agreements are going to be devastating for industrial capacity, for tariff revenues," says Vickers. "There's a need for far greater development cooperation to address these issues."

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EU grant to tackle rural poverty in South Sinai

from Reuters Alert Net

AIRO, 18 June 2007 (IRIN) - The European Commission (EC) has awarded 55.5 million euros (about US$74.2 million) for a landmark development project in Egypt's South Sinai Governorate. The aid will target some of Egypt's poorest rural populations, including Sinai's 22,000 Bedouin population, many of whom are failing to benefit from Sinai's booming tourist economy.

The Sinai peninsula, which returned to Egypt from Israel after the 1979 Camp David Accord, has witnessed rapid development since then in the tourism sector, which dominates the region's economy. Around 110,000 people now live in the governorate.

However, despite being officially one of Egypt's richest governorates, social divisions remain high. Much of the Bedouin population is not officially registered with the state, and has little access to education or healthcare. According to development agencies, illiteracy is as high as 90 per cent amongst some sectors of the Bedouin population.

EC spokesperson Germaine Demian told IRIN: "It is important to secure the participation of the entire population of South Sinai in the programme so that they can enjoy the economic and social benefits."

The project is divided into two components. The first will concentrate on infrastructural upgrades, such as supplying potable water to rural communities, solid waste and waste-water management, and environmental protection equipment for the area's nature reserves.

The second component, worth 20.5m euros, is earmarked for poverty alleviation and social development projects executed through local and international non-governmental organisations (NGOs).

While poverty levels in South Sinai's cities - Sharm el-Sheikh, Dahab, Nuweiba - are relatively low, rural populations (Bedouin) without outside support have been facing nearly a decade of drought and declining health and nutritional standards.

"Extreme poverty"

Bishow Parajuli, representative and country director of the UN World Food Programme (WFP) in Egypt, told IRIN: "Access to resources [for the rural population] is going down and down. It is extreme poverty." The WFP is one of the beneficiaries of the second component of the EC grant.

"The statistics will not show that the area is so poor. Sharm el-Sheikh will mask that. But you need to identify the traditional communities," he added.

WFP, which has been conducting a nutrition and capacity building project in Sinai since 1986, said its part of the 55.5m euro total would be used to enhance its existing programme and widen the capacity building element.

"As well as expanding, we will be focusing more on the human assets [among the Bedouin community], such as training, vocational skills and women's empowerment," said WFP Sinai Programme Director Khaled el-Shatila.

The EC has also provided a total of one million euros for small grants (below 10,000 euros) to be distributed directly amongst Sinai's 12 Bedouin tribes for water, agriculture, livestock, handicrafts and ecotourism projects.

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Poor Countries Must Step Up Efforts To Fight Poverty: EU Official

from Playfuls

Poor countries must step up their efforts to eradicate poverty by strengthening good governance, a European Union development official said Wednesday, while international watchdogs urged the EU to improve the effectiveness of its development aid.

"Not a single country has come out of poverty by development aid alone," said Koos Richelle, head of the EU's development aid office.

International aid could not make a country developed "but it must have its own motives," Richelle told a news briefing.

Good governance, respect for human rights, democratic reforms as well as support for non-governmental organizations was crucial to combat poverty, the EU aid expert said.

His comments came as international development watchdogs urged the EU to change its aid policy, arguing that more could be done to make "a visible difference in the lives of people living in poverty."

Despite being the world's biggest multilateral donor, the EU has a "mixed" record on the issue, an alliance of international development organisations and Caritas Europe said in a report released Wednesday.

The organisations called on the EU to base its aid on developing countries' own priorities in fighting poverty. They also said that the EU must better monitor and evaluate the real impact of its aid.

Richelle said that the European Commission, which is coordinating EU development aid, would "listen to the pleas of the regions and support their speed of development."

Turning to emerging donor countries, Richelle said that the EU could not criticise governments in China and Brazil for not basing their help on the sustainability of projects in poor countries.

"They want access to raw materials and resources and this is acceptable as we did the same for decades," Richelle said.

However, this would undermine international efforts to promote good governance in poor countries as new donor's aid criteria were not transparent and not in line with the EU's values, he said.

China last year signed trade deals worth some 1.5 billion euros (1.9 billion dollars) with African nations without linking them to democratic reforms and human rights, prompting European fears that the EU could lose its clout in Africa.

The 27-member EU last year committed 7.6 billion development aid and disbursed 6.5 billion euros in aid. EU aid goes to more than 150 countries, territories and organisations worldwide.

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Africa: Some More Unequal to EU Than Others

from All Africa

Inter Press Service (Johannesburg)

David Cronin
Brussels

The European Union's development aid chief has been accused of prioritising central African countries for which he has a personal fixation at the expense of other needy nations.

Louis Michel, European commissioner for development, is currently assessing how aid for the African, Caribbean and Pacific (ACP) bloc that was not spent within its stipulated timeframe should be used.

Of the 400 million euro (533 million dollars) already earmarked for particular countries, about a quarter has gone to three central African nations: Rwanda, Burundi and the Democratic Republic of Congo (DRC).

Anti-poverty activists have complained that Michel may not be respecting the European Commission's own guidelines in distributing this aid. These guidelines state that recipient countries which have a good track record in ensuring that aid is used should be given preferential treatment when unspent money is being earmarked.

"What we are seeing is that there is no clear link between those who perform well and those who receive more money," said Rein Antonissen, European policy officer with the Belgian organisation 11.11.11.

"Some countries that are on the radar screen of the European Commission (the executive arm of the EU) receive much more money than others. The procedures being followed to reallocate this money are unclear."

Antonissen said he was not arguing that central Africa should not be granted increased funding. "But there should be transparency about why certain countries and regions are losing money, when others are gaining so much," he told IPS.

The sums being reallocated come from the European Development Fund (EDF), which was established following a 1957 decision by European leaders on financing former colonies. A total of 13.5 billion euro (18 billion dollars) was allocated to the EDF for the 2000-07 period.

As 3 billion euro (4 billion dollars) of money available to the fund had not been spent by the end of 2005, a large amount still has to be earmarked to particular countries.

Michel, who was Belgium's foreign minister from 1999 to 2004, has made no secret of his interest in central Africa. He has paid particular heed to conflict resolution efforts in Congo, a former Belgian country. The war that erupted in Congo during the late 1990s is estimated to have claimed four million lives, making it the deadliest the world has seen since the 1940s.

His spokesman Amadeu Altafaj defended the singling out of Congo.

"If four million dead is not a good reason to make the DRC a priority, then I don't know what is," he said. "The DRC is at the centre of a continent. It has huge potential for development but also has huge potential for springing violence onto its neighbours."

For a long time, he said, the DRC did not benefit from the attention of the international community. "In some way, we are partially responsible for the years of death and darkness there. We are emerging from a very dark decade, so we have to invest a lot of resources there."

Unpublished data seen by IPS indicates that 37 of the 78 ACP states have an above- average performance rate in making sure the aid they receive is committed to particular projects. Yet just 13 of these have so far received additional aid from the EU.

Uganda, Malawi, Angola, Chad, Swaziland, Botswana and Kenya are among those considered good performers not to have received any fresh aid.

Members of the European Parliament (MEPs) have long complained that they cannot hold the EDF under proper scrutiny. Because the fund is managed separately from the EU's main budget, the parliament does not have the same right to sign its accounts as it does with other areas of the Union's expenditure.

MEPs have demanded, too, that a minimum of 20 percent of the EU's development aid should go to health and education. Yet the proportions directed to these sectors from the EDF have fallen well below such targets.

Marta Monteso from ActionAid said that health and education will each be allocated 2 percent of the 23 billion euro (31 billion dollars) promised to the EDF from the Union's governments for 2008-13. This is lower than the proportions allocated in 2000-2007, when each of the sectors got 4-5 percent of the total.

Monteso described as "alarming" signals that unused money will not be used to any significant degree in the fight against AIDS and other leading killers of the poor.

Rather than use unspent sums for this purpose, sums have been taken from the EDF to cushion the blow for ACP sugar-producers from the EU's agricultural reform measures and for supporting the African Union peacekeeping mission in Sudan's Darfur region. This is despite the fact that expenditure on military operations does not meet the eligibility criteria for development aid drawn up by the Organisation for Economic Cooperation and Development (OECD, a grouping of 30 rich nations) in Paris.

Monteso also urged Michel and his officials to explain the grounds on which reallocation decisions are being made. "Non-governmental organisations have been asking for more transparency for eight months now," she said. "We still haven't got that."

The European Parliament has been pushing Michel to give it a formal role in monitoring the new set of aid plans for ACP countries which the Commission is currently finalising. Last month, though, Michel said he was precluded from doing so by rules covering the EDF.

Altafaj argued that it would be wrong to draw general conclusions from the reallocations that have taken place so far. "There are a number of situations we have to consider, so there is no one-size-fits-all approach. In some countries, health and education are a priority, in others they are not.

"If you look at the DRC, we have put together a package of 165 million euro (220 million dollars) to provide fast-impact actions. This is already showing dividends in terms of democracy and we see benefits in healthcare and water. We are working very hard not to lose one euro between now and the end of 2007."

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EU Must Stop Hurting the Poor, Christian Aid Says

from Christian Today

Campaigners across Europe are to ask their governments to threaten to withhold funds from the World Bank unless specific changes are made to policy and practice.

by Anne Thomas

Campaigners across Europe will gather near the French Finance Ministry in Paris on Monday 5 March to put pressure on civil servants who are meeting there to discuss donor government’s contributions to the World Bank’s coffers.

Protestors are to ask their governments to threaten to withhold funds from the World Bank unless specific changes are made to policy and practice, Christian Aid reports.

Sixty NGOs from 15 countries, including Christian Aid, are urging European governments to demand that the World Bank end economic policy conditionality and phase out spending on fossil fuel operations.

They accuse the World Bank of applying a misguided development model, undermining countries’ abilities to chart their own development paths and often contributing to worsening poverty and environmental degradation.

Last year, Hilary Benn, the UK’s Secretary of State for International Development, withheld £50m from the World Bank in protest of the economic conditions it attached to loans. He said that UK funding pledges for the next three years, which start in Paris on Monday, depend on whether the World Bank undertakes genuine reform.

Although the World Bank later published a report showing it had reduced the number of conditions it attaches to loans and debt relief, Christian Aid believes this is not enough and that the World Bank has to make more reforms if it is to receive fresh funding from European governments, which provide 60 per cent of its money.

Martin Gordon, Christian Aid’s international campaigns manager, said: “We cannot accept the glacial pace of change at the World Bank. It’s time for European governments to put their money where their mouth is and force the World Bank to change its lending policy.”

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EU declines free trade pact with Pakistan

from Zee News

Pakistan is likely to loose its biggest market with the European Union declining to sign a Free Trade Agreement (FTA) with it, arguing that the size of Pakistan's economy is not big enough for such a deal. Against the backdrop of the EU's refusal to sign the FTA, Pakistan would be the only country in the region in the coming years to lose its biggest market, a senior Pakistan government official told the news today.

"Pakistan's Reliance on the EU market and the US is too much and in case the EU market is lost, Pakistan would stand nowhere with regard to exports," the Daily quoted an unnamed official as saying. Commerce Secretary Asif Shah admitted that the EU has based its decision keeping in view the size of Pakistan's economy. "On this particular point we have successfully made EU top officials understand and convince them with facts and figures that Pakistan's economy is growing with rapid pace in the region and the size of the economy is also expanding," Shah said, adding that Commerce Minister Humayun Akhter Khan would soon visit EU countries separately to remove the misgivings in this regard.

On the other hand, the EU has decided to ink a FTA with India that would facilitate greater demands for Indian products at zero duty. "Right now apart from India and Pakistan, all the SAARC countries as LDC contracting states are exporting their products to EU at zero duty and in case the FTA deal is struck with New Delhi, Indian products would also enjoy zero duty and capture the market of Pakistani products also. This is really an alarming situation for Pakistan," an official said on condition of anonymity.

Islamabad has communicated to Brussels that Pakistan is the frontline state against terrorism and in case trade cooperation is not extended to Pakistan, terror activities would further increase because of poverty in the country. "The poverty situation would worsen in the country if trade under the FTA is denied," the daily quoted a Pakistan foreign office officials as saying. Shah said the EU in response to Pakistan's request for the FTA has communicated that it frames FTAs with countries keeping in view its economic considerations. He said the EU is of the view that since Pakistan's tariff regime is liberalised, it does not need a trade deal with Islamabad.

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