EU warns Brexit deal unlikely as talks deliver no progress

Yahoo – AFP, 21 August 2020

EU’s Brexit negotiator Michel Barnier holds a news conference after a meeting
with Britain’s chief negotiator in Brussels on August 21, 2020. – Barnier said he was
worried and “disappointed” at the lack of progress in the latest round of Brexit
trade talks. (Photo by YVES HERMAN / POOL / AFP)

The EU and Britain on Friday traded blame for the lack of progress after the latest round of post-Brexit trade talks, with Brussels warning that a deal looked unlikely.

The EU’s chief negotiator Michel Barnier lodged his warning at the close of the seventh round of trade talks, which again got stuck on key issues, mainly fishing rights and competition rules.

Hundreds of negotiators met over several days in the Belgian capital with both sides acknowledging a sliver of progress on technical issues — but not on the main obstacles.

“Those who were hoping for negotiations to move swiftly forward this week will have been disappointed,” Barnier told reporters after the talks ended in Brussels.

“And, unfortunately, I too am frankly disappointed and concerned and surprised as well,” he added.

His UK counterpart David Frost countered that Brussels’ insistence that London meet EU demands on state aid and fisheries policy before work on other areas made it “unnecessarily difficult to make progress”.

Frost reiterated that he thought a deal remained possible and was Britain’s aim but he warned: “It is clear that it will not be easy to achieve.”

‘Backwards not forwards’

Barnier said that “too often this week it felt as if we were going backwards rather than forwards.”

“At this stage an agreement between the UK and European Union seems unlikely.

“I simply do not understand why we are wasting valuable time,” he said.

Britain left the EU in January, nearly four years after a landmark referendum to end almost 50 years of European integration.

Both sides are pushing to have a deal in place by the end of a post-Brexit transition period that ends on December 31.

The Europeans said this requires an agreement by October, leaving just two more months to find common ground.

If no deal is struck, ties will default to minimum standards set by the World Trade Organization, bringing higher tariffs and making onerous demands on business which threaten chaos on the cross-Channel border.

A European source said that Britain was pushing to delay negotiation on fishing and competition until as late as possible, a strategy that Brussels said was unacceptable.

“On these two pillars of a future agreement, the stalemate continues. You can’t keep moving forward on other issues when you have a gaping hole on the core issues,” the source said.

The next round of talks will be held in London September 7, with an EU summit planned for October 15-16 seen as the unofficial deadline for a deal.

A senior UK negotiating official said Frost would be in “close contact” with Barnier over the next couple of weeks before the next round of talks.

EU envoys meet to seal Brexit talks red lines

Yahoo – AFP, Alex PIGMAN, February 24, 2020

France is leading a small group of countries demanding that European vessels maintain
open access to British waters that are particularly rich in fish stocks (AFP Photo/William
EDWARDS)

Brussels (AFP) - EU envoys meet on Monday to finalise a negotiating mandate for Brexit trade talks with Britain, with France insisting on strict red lines to uphold European standards.

Establishing the foundation for new ties with Britain is the next chapter in the Brexit saga, with signs pointing to several months of acrimonious talks between London and Brussels with the outcome highly uncertain.

Britain left the European Union on January 31, but entered a transition phase until the end of the year to give time to hammer out a new basis for relations on trade, security and defence.

But there are doubts the two sides will bridge their differences in that time, with French President Emmanuel Macron warning at the weekend he was "not sure" a deal would be struck by the end of December.

Trade will be the biggest flashpoint, with the remaining 27 EU countries especially nervous that Britain will backslide on standards to win a competitive edge against European businesses.

Fishing is also a hot-button issue, with France leading a small group of countries demanding that European vessels maintain open access to British waters that are particularly rich in fish stocks.

The EU envoys meet at around 1400 GMT and if they find common ground, the matter will then go to a meeting of European affairs ministers on Tuesday, whose final green light would open the way for talks with the UK to start on March 2.

'The whole point'

Recent days have shown that tetchy talks lie ahead, with Britain insisting it is no longer chasing a deep partnership with Europe that would require matching EU rules on health, labour standards, environment and other matters.

Instead, Prime Minister Boris Johnson is asking for a simplified deal similar to those the EU has struck with Canada, Japan and South Korea that reduce tariff barriers to near zero, but which have less strict controls on standards.

Bringing that point home to Europe, in a speech in Brussels last week, Britain's chief Brexit negotiator David Frost said his government's desire to throw off EU regulations was not just a negotiating position but "the point of the whole (Brexit) project".

"We must have the ability to set laws that suit us -- to claim the right that every other non-EU country in the world has," Frost said.

Even a "no deal", with its heavy implications for the economy, does not seem to frighten London, casting deep uncertainty in the forthcoming negotiations of barely 10 three-week rounds of talks.

The European side is annoyed and to some measure suspicious of the change of heart, especially since British Prime Minister signed a political declaration in October that called for an ambitious partnership.

The negotiating mandate under consideration was first proposed by the EU's chief negotiator Michel Barnier with bloc member states inserting their changes over the past few weeks.

In drafts seen by AFP, language on fishing and on upholding norms -- known as maintaining the "level playing field" -- have been toughened up, which EU sources said came at the insistence of Paris.

Some member states have added language on issues close to them, including a call that Britain must "return unlawfully removed cultural objects to their country of origin", a problem dear to Greece, Italy and Cyprus.

Stefaan de Rynck, a senior adviser to Barnier, warned last week that the next few months of talks could be even tougher than the divorce negotiations that formally ended Britain's 47-year membership of the EU.

"We expect some of the negotiations to be rather difficult, perhaps more difficult than during the withdrawal," de Rynck told an audience at the London School of Economics.

French Foreign Minister Jean-Yves Le Drian put it even more vivdly, predicting the two sides would "rip each other apart".

London has until the end of June to ask for a deadline extension should the talks fail to make any headway in the coming months.

But Johnson has ruled out asking for more time, a stance that raises the prospects of a "no deal" or only a bare-bones deal which could also bring major disruption.

Macron says 'not sure' EU-UK trade deal possible before end of 2020

Yahoo - AFP, February 23, 2020

French President Emmanuel Macron said that trade negotiations between the
European Union and Britain will "become more tense" (AFP Photo/Ludovic Marin)

Paris (AFP) - French President Emmanuel Macron on Saturday said he was "not sure" it would be possible for the European Union and Britain to reach a trade deal by the end of the year.

Britain and the EU are about to embark on negotiations aiming to hammer out a trade agreement by the time the post-Brexit transition period shuts at the end of December.

But France has made clear it thinks the negotiations will be particularly difficult, especially in such a tight timeframe.

"I am not sure that an agreement will be reached between now and the end of the year," Macron said at a meeting with fishermen, who are concerned for their livelihoods after Brexit, at an agricultrual trade event in Paris.

"Anyway, it is going to become more tense because (the British) are very hard," he said, adding that fishing rights would be a key point of contention.

Britain formally ended its 47-year membership of the EU on January 31, nearly four years after a majority voted to leave the bloc in a 2016 referendum.

France and several other countries want to be able to keep fishing in British waters, while London wants full autonomy and limited access for European fishermen.

The EU's chief negotiator Michel Barnier has said the EU's top priorities are fishing, security and maintaining fair trading conditions for European companies.

He has also firmly rejected a British suggestion that City of London companies could be given broad, permanent access to EU markets without conditions.

Overall, French fishing boats generate 30 percent of their revenue from catches in British maritime territories, particularly rich in fish stocks.

French officials say that the UK exports the bulk of its catch to Europe, indicating that British fishermen have plenty to lose if the two sides fail to reach a deal.

EU green lights trade talks with Washington to defuse tension

Yahoo – AFP, Lachlan CARMICHAEL, April 15, 2019

The EU's 28 member states had struggled for months to agree on a mandate to open
 trans-Atlantic talks, with some fearing the delay would restart a trade war with
President Donald Trump (AFP Photo/STR)

Brussels (AFP) - European Union countries on Monday overruled France and gave the green light for Brussels to open trade talks with Washington as soon as possible and defuse trans-Atlantic tensions.

The EU's 28 member states had struggled for months to agree on a mandate to open the talks, with some fearing the delay would restart a trade war with US President Donald Trump.

But EU ministers meeting in Luxembourg approved a mandate to negotiate "an agreement limited to the elimination of tariffs for industrial goods only" and another accord designed to remove non-tariff barriers.

The ministers said the mandate would exclude agriculture products, which EU trade minister Cecilia Malmstrom said amounted to a "red line" for Europe.

US officials have pushed for farm products to be included.

"I will now get in contact with our American partners with a view to organising a date for the first round as soon as possible," Malmstrom told a press conference in Brussels.

"If we agree to start, I think it can go quite quickly," the Swedish commissioner added.

Malmstrom underlined the determination of the European Commission, the EU's executive arm, to finish the talks before its five-year term ends on October 31.

'Climate chaos'

EU sources said France voted against the mandate and Belgium abstained during the Luxembourg meeting.

Pursuing a limited trade deal is a key element of a truce negotiated in July that came close earlier this month to imploding after the US threatened $11 billion in fresh trade tariffs against Europe.

Paris voted against the mandate over worries about domestic blowback just months ahead of European elections, set for May 23 to 26.

EU trade minister Cecilia Malmstrom said she w"ill now get in contact with our 

American partners with a view to organising a date for the first round as soon 

as possible" (AFP Photo/EMMANUEL DUNAND)

French President Emmanuel Macron has insisted the US first sign back up to the Paris climate accord after Trump dumped the pact in 2017, infuriating Macron.

But only a qualified majority of EU members was needed to support the talks, meaning France's "non" remained largely symbolic.

Greenpeace has called on the Commission and national governments not to enter into trade negotiations with any country that rejects the Paris climate pact.

"EU-Trump trade talks would seriously call into question the EU’s resolve on climate change," Greenpeace's Naomi Ages said, warning time was running out to prevent "climate chaos."

In a bid to win France over, its EU partners agreed to insist on environmental guarantees during the talks with Washington.

In another sop, they also made a specific mention that TTIP, a far more ambitious transatlantic trade plan that never materialised, be officially called "obsolete".

The Transatlantic Trade and Investment Paratnership talks stalled following widespread protests in Germany, France and Austria over fears it would undermine EU standards on food and health.

At France's demand, agricultural products are also off the table.

'Ease trade tensions'

Berlin wants the limited deal in order to placate Trump and avoid US auto tariffs that would punish Germany's cherished exports.

The mandate from the EU stipulates that the talks would end if the US pursued more levies against Europe, including on cars. It also says the EU cannot conclude the negotiations as long as the metal tariffs remain.

The limited deal concerns only industrial goods, excluding the automotive sector. Fishing is also included, but not agriculture, services or public procurement.

The US however insists its wants to discuss agriculture, while Europeans would like to include cars. Both sides will have to bridge the gaps before the start of talks.

At a meeting last July at the White House, Trump and European Commission President Jean-Claude Juncker pledged no new tariffs following those on steel and aluminium.

That peace was in danger earlier this month after the US threatened to impose tariff counter-measures of up to $11.2 billion on a host of European products in response to subsidies received by aircraft maker Airbus.

But Malmstrom said: "This is a welcome decision that will help ease trade tensions."

Caspian Sea nations sign landmark deal

Yahoo – AFP, Christopher RICKLETON, August 12, 2018

The Caspian Sea borders Azerbaijan, Kazakhstan, Iran, Russia and
Turkmenistan (AFP Photo/BEHROUZ MEHRI)

Aktau (Kazakhstan) (AFP) - The leaders of the five states bordering the resource-rich Caspian Sea signed a landmark deal Sunday on the legal status of the inland sea which boasts a wealth of oil and gas reserves and sturgeon.

The leaders of Azerbaijan, Iran, Kazakhstan, Russia and Turkmenistan signed the agreement on the status of the inland sea, which has been disputed since the collapse of the Soviet Union rendered obsolete agreements between Tehran and Moscow.

The host, Kazakh President Nursultan Nazarbayev, said before the signing that the leaders were "participants in a historic event."

"We can admit that consensus on the status of the sea was hard to reach and not immediate, the talks lasted more than 20 years and called for a lot of joint efforts from the parties," Nazarbayev said.

Russian leader Vladimir Putin, whose country was seen as driving the deal, said the convention had "epoch-making significance" and called for more military cooperation between the countries on the Caspian.

Nazarbayev said the convention allows for the construction of underwater oil and gas pipelines as well as setting national quotas for fishing and forbids any foreign military presence.

Iranian President Hassan Rouhani was quick to hail the clause that prevents non-Caspian countries from deploying military forces.

"The Caspian Sea only belongs to the Caspian states," he said.

Putin also praised this clause, saying it would help "ensure the peaceful status of the Caspian Sea."

National boundaries

The deal provides a means of delimiting national boundaries in the sea whose underground energy resources are estimated at 50 billion barrels of oil and just under 300 trillion cubic feet (8.4 trillion cubic metres) of natural gas.

But Rouhani stressed several times during the summit that these boundaries still need to be worked out between the countries.

Iran, which ended up with the smallest share of the sea under the terms of the convention, is viewed as a potential loser in the deal.

Sunday's summit was the fifth of its kind since 2002 but there have been more than 50 lower-level meetings since the Soviet breakup spawned four new countries on the shores of the Caspian.

The deal goes some way to settling a long-lasting dispute on whether the Caspian is a sea or a lake -- which means it falls under different international laws.

A map of the Caspian Sea locating Aktau, in Kazakhstan, where a deal was 

signed Sunday by surrounding countries which ends decades of dispute over the 

inland sea rich in oil, gas and caviar. (AFP Photo/Valentina BRESCHI)

While the convention refers to the Caspian as a sea, provisions in the agreement give it "a special legal status", Russian deputy foreign minister Grigory Karasin told Kommersant daily earlier this week.

The agreement also offers hope for the Caspian's ecological diversity and its depleted stocks of the beluga sturgeon, whose eggs are prized globally as caviar.

While it remains to be seen how the deal will be implemented, the summit in Aktau was another opportunity for Moscow to present itself as a diplomatic deal-maker.

After years of unsuccessful negotiations on the Caspian the Kremlin "gains political kudos for breaking a log-jam," said John Roberts, a non-resident senior fellow at Atlantic Council's Eurasia Center.

Trans-Caspian plan

Turkmen leader Gurbanguly Berdymukhamedov greeted the deal enthusiastically as his country wants to send gas to markets in Europe via a long-planned Trans-Caspian underwater pipeline.

The project is billed as allowing European countries to ease their dependence on gas from Russia at a time of heightened geopolitical confrontation.

Nevertheless, Iran and Russia could still challenge the pipeline on ecological grounds. They have previously blocked the project, which could cost up to $5 billion to build and would have a projected capacity of 30 billion cubic metres per year.

Kate Mallinson, Associate Fellow for the Russia and Eurasia Programme at Chatham House, urged caution over the prospects for the pipeline, saying the Aktau deal "is not a legal prerequisite for the construction."

"Neither will a major transport corridor to export Turkmen gas to Europe emerge overnight."

EU parliament calls for ban on electric pulse fishing

France24 –AFP, 16 Jnauary 2018

Philippe Lamberts and Ska Keller, who head the Greens bloc in the European
Parliament, display a placard against pulse fishing which involves dragging
electrically-charged lines just above the seabed to shock low-lying marine life
 into trawling nets

STRASBOURG (FRANCE) (AFP) – The European Parliament called Tuesday for a ban on electric pulse fishing in the European Union, defying Brussels which wants the experimental practice in the North Sea done on a larger scale.

The parliament, the EU's only directly-elected body, will now try to strike a compromise with the European Commission, the bloc's executive, and the European Council, which groups the 28 member states.

MEPs voted by 402 members to 232 in favour of the ban, while 40 abstained.

"It is a wonderful victory against a terribly harmful kind of fishing," said Yannick Jadot, a French member of the Greens party, who took part in the campaign against the practice.

Pulse fishing involves dragging electrically-charged lines just above the seafloor that shock marine life up from low-lying positions into trawling nets.

EU rules allow member states to equip up to five percent of their fleets with electrodes, and the method has been adopted in particular by Dutch vessels fishing for sole.

The European Commission wants to maintain the southern part of the North Sea as the venue for pulse fishing but to remove the five-percent limit.

Karmenu Vella, the commissioner for fisheries, argued that pulse fishing is safer for the environment than beam trawling as it reduces carbon emissions and does less damage to the seabed.

Beam trawling involves a large net attached to a heavy metal beam of up to 12 metres in length which is dragged across the seabed, ploughing it up.

Rebecca Hubbard, director for the activist group Our Fish, praised the vote as a "huge win" for European seas, low-impact fishing and the public.

EU parliament calls for ban on electric pulse fishing https://t.co/Ojo4KvvpRt pic.twitter.com/lEXiYidfR6

— AFP news agency (@AFP) January 16, 2018

Related Article:

Top European chefs take electric pulse fishing off the menu

More than 200 top chefs across Europe have pledged to stop sourcing seafood

obtained by electric pulse fishing.

The black clouds hanging over the boats in Dutch ports are not the remnants of wild winter gales, but harbingers of another devastating storm brewing for Dutch fishermen pic.twitter.com/V4khrxhEnY

— AFP news agency (@AFP) January 21, 2018

Top European chefs take electric pulse fishing off the menu

Yahoo – AFP, January 11, 2018

More than 200 top chefs across Europe have pledged to stop sourcing seafood
obtained by electric pulse fishing.

More than 200 top chefs across Europe have pledged to stop sourcing seafood obtained by electric pulse fishing, days before an EU vote that could expand the use of the controversial technique, an ocean advocacy group said Thursday.

"We refuse to work with seafood coming from a fishing method that condemns our future and that of the ocean," said the text written by Christopher Coutanceau, whose restaurant on the Atlantic coast in La Rochelle, western France, has earned two Michelin stars.

The practice involves dragging electrically charged lines just above the seafloor that shock marine life up from low-lying positions into trawling nets.

EU rules allow member states to equip up to five percent of their fleets with electrodes, and the method has been adopted in particular by Dutch vessels fishing for sole.

On Tuesday, the EU is to vote on the practice, which critics say harms too many fish that are left on the seabed, as well as those that are harvested.

"Electric trawlers produce catches of poor quality, fish which underwent stress and are often marked by post-electrocution bruises," according to the text released by Bloom, a French NGO.

"It is impossible to work with such low-quality products."

The signatories included French chefs Helene Darroze, Yannick Alleno and Olivier Roellinger, who has longed worked to improve sustainability in the fishing industry.

Spanish chefs Elena Arzak and Quique Dacosta, Italy's Antonino Cannavacciuolo and Alfonso and Ernesto Iaccarino, and Thomas Buehner and Heinz Winkler of Germany also signed the text.

On Wednesday, several members of the European parliament asked for a delay to next week's vote on electric pulse fishing, in order to allow time for an "informed debate".

For Jerry Percy of the Low-Impact Fishers of Europe (LIFE), which claims to represent about 80 percent of Britain's independent fishermen, a main problem is the lack of solid data on the long-term consequences of the practice on fishing stocks.

The method is outlawed in many parts of the world, including China, but proponents say it is more environmentally friendly and results in lower fuel usage for boats.

Bloom had already filed in October a case against the Netherlands with the European Commission, accusing the country of illegally authorising its trawlers to use the technique.

Germany and the Netherlands end centuries-old border dispute

The Netherlands and Germany have long disagreed about where exactly their shared nautical border lies in the North Sea. A meeting of the two nations' foreign ministers finally put an end to the dispute.

Deutsche Welle, 24 Oct 2014

A border dispute is not an issue usually associated within the cut-and-dry framework of the European Union. Yet that's just what Germany and its neighbor, the Netherlands, finally laid to rest on Friday after centuries of discord over the between German East Frisia and Dutch West Frisia, according to German news agency dpa.

German Foreign Minister Frank-Walter Steinmeier (above left) and his Dutch counterpart, Bert Koenders (right), met at the border between the German town of Emden and Delfzijl in the Netherlands, where the Ems River empties into the disputed Dollart Bay. The ministers signed an agreement that the border will remain ambiguous and both nations will share responsibility for the area.

"If only every conflict could be solved so easily," said Steinmeier, after he and Koenders signed the document, symbolically astride the deck of a ship, floating between both nations.

The agreement has important economic implications, as it has long been the site of contention between German and Dutch fisherman, as well as the 450 million euro- ($570 million) Borkum Riffgat offshore wind farm, run by the German EWE energy company to the ire of Dutch protesters.

On the Dutch side, in Delfzijl, a coal power plant has been built which the German East Frisians say will pollute the river and the bay and hurt tourism - something they depend on. The government of Lower Saxony, the state to which East Frisia belongs, called it an "unfriendly act" on the part of the Dutch.

The document signed by Steinmeier and Koenders put these issues to rest, at least diplomatically, and the German wind farm no long stands on shaky ground in terms of international law. The responsibilities of both nations are now clearly defined.

Steinmeier called the agreement "a good result for the economy, for new wind farms and maritime interests."

Related Articles:

Philippines, Indonesia Sign ‘Model’ Maritime Border Accord

China calls for peaceful settlement of maritime disputes

Russian bear grumbles as food sanctions hit Moscow zoo

Yahoo – AFP, 8 Aug 2014

A polar bear eats bread in the Moscow Zoo on August 8, 2014

Moscow (AFP) - Russia's drastic ban on food imports from Europe has claimed it first victims -- the rather choosy animals at Moscow zoo.

Keepers at the zoo, one of Europe's oldest, are scrambling to adjust the menus for its animals, which rely heavily on Dutch vegetables and Polish apples.

"Almost all the animals eat fruits and vegetables except for those who eat fish," said Moscow Zoo spokeswoman Anna Kachurovskaya.

A northern fur seal eats a fish in

 Moscow Zoo on August 8, 2014 (AFP

Photo/Kirill Kudryavtsev)

"Those who eat fish are also in trouble because fish is also embargoed."

With fears of rising food prices hitting poor Russians, the animals have also been caught in the crossfire of the tit-for-tat sanctions war with the West over Russian involvement in Ukraine.

Russian Prime Minister Dmitry Medvedev on Thursday announced the embargo on most food imports from the EU, the United States and several other countries in a measure that includes beef, pork, fruit and vegetable produce, poultry, fish, cheese, milk and dairy products.

The zoo will now have to find new suppliers, in particular for celery and apples, and said it is very concerned about feeding the animals in the winter when Russian produce is not as readily available.

Russian officials have voiced confidence that new suppliers for most imported products can be found, although certain items may be difficult to replace quickly.

Apples are a particular favourite of the zoo's bears, an animal synonymous with Russia that for many symbolises the country's virility and independence.

"So the bear eats apples. It used to eat Polish apples, now it will have to eat Russian ones," Kachurovskaya said. "That is not the problem, the problem is we are uncertain about what we will have to confront in the winter."

"In general we use imported products for the animals for a variety of reasons, including their preferences as well as cost," Kachurovskaya said.

"We are looking at what we can do, but it is not going to be easy."

The zoo, a sprawling grounds in the Moscow city centre which has more than 150 wild animals, celebrates its 150th anniversary this year.

Related Article:

EU imposes new sanctions in 'a strong warning' to Russia

EU undermines its own development policies

Deutsche Welle, 20 April 2014

The EU is one of the largest donors of development aid, but these policies have not played much of a role in the European election campaign. Economic interests, meanwhile, are jeopardizing its effectiveness.

Euro rescue, the banking union, a reduction of bureaucracy and more power for the European Parliament: these topics have been dominating the European election campaign in Germany. The fact that the various parties aren't talking up the fight against poverty in Africa, promoting economic development in Asia or calling for the strengthening of democracy and human rights in Latin America seems, at first glance, logical. After all, they are the elected representatives of EU citizens.

"It is unfortunately the case that development policy plays a subordinate role in the voting decision," said Norbert Neuser, a member of European Parliament with the Social Democratic Party, and also part of the Parliament's Committee on Development. In recent years, the EU has achieved much with its development work in cooperation with Africa; the focus on the UN's Millennium DevelopmentGoals has led to measurable results.

Development work can curb migration

The objective of EU development aid is to promote good governance, along with human and economic development. This includes promoting the sustainable use of natural resources, as well as contributing to the fight against hunger and poverty. According to the European Commission, efforts to contain migration are not among the stated objectives of the EU's development work.

Poverty and a lack of opportunities have
forced many to flee to Europe

However: development success can help ensure that people remain in their home countries. In Ethiopia, for example, the EU has devoted 200 million euros ($276.3 million) to road construction. As a result, people living in remote villages now have a faster and more secure route to larger cities, where they can sell their products on markets, which has reduced rural poverty significantly.

Contributing to development and the reduction of poverty in the developing countries of the South are therefore in Europe's best interest. After all, those who don't see a future at home end up leaving. Like the people on crowded refugee boats picked up by the Italian, Spanish and Greek coast guards, or the hundreds of people that have tried to reach European soil by scaling the fences surrounding the Spanish enclaves of Ceuta and Melilla in northern Morocco.

Export subsidies ruining African farmers

More than half of world's official development assistance (ODA) comes from the EU and its member states, with a focus on cooperation with the so-called ACP countries in Africa, the Caribbean and the Pacific. Of the 79 ACP countries, many are former European colonies.

In the Lisbon Treaty, which came into force in 2009, the EU pledged to a coherent policy when it comes to development. Accordingly, any European policy decisions in the areas of foreign relations, agriculture or economic expansion must not interfere with the objectives of development policy.

African farmers can hardly compete
with EU agricultural exports

The reality, however, is different. "On the one hand, the EU wants to do everything possible to fight poverty and hunger," said Christa Randzio-Plath, the vice president of the Association of German Development NGOS (VENRO). "On the other hand, they work against this development effort with food exports. What good is it to small farmers in Africa if their markets are flooded with cheap EU agricultural products?"

True, the EU subsidies for agricultural exports to Africa amounted only to 150 million euros this year. And in January, the EU commissioner responsible for agriculture and rural development, Dacian Ciolos, announced that export subsidies would be eliminated entirely - without giving a specific timeline. In any case, the damage is already done: decades-long export subsidies for products like poultry, for example, have driven many African farmers to ruin.

Unequal partnership

It's not just agriculture that has been affected, as European fishing fleets cast their nets off the African coast."Fisheries agreements allow the EU to benefit from African fishing stocks, and not the local population," said Randzio-Plath.

The EU does pay compensation to states that give European fishing vessels access to their waters and fish stocks. Senegal, for example, receives about 16 million euros per year, Mozambique a little over 4 million and Mauritania, 86 million euros. But according to the World Wildlife Fund, the market value of these catches is usually significantly higher than the compensation. In addition, coastal fishermen also lose their livelihood.

After the EU fishing fleets have taken what
they need, not much is left for locals

MEP Neuser is also critical of the various economic partnership agreements that the EU is currently negotiating with the ACP states. "There is definitely a need for some counseling in this area, since the policies that we're negotiating there aren't very fair for the developing countries."

The EU has stated that partnership agreements are meant to encourage development in the ACP countries. But according to aid agencies, the opposite is the case. "In their current form, economic partnership agreements are far-reaching free trade agreements which mainly benefit European exporters."

The partnership agreements would require African countries to open their markets to European exports. They would also liberalize the service sector, allowing European investors to get involved in projects supplying services like drinking water, for example. But examples from other regions have shown this usually leads to price increases, without much improvement in quality.

Elites must take responsibility

But lack of coherent policy from the EU is only one side of the coin. The "failure of the elite" in many African countries cannot be pinned on Europe's development policies, said Neuser, giving the "negative example" of Nigeria. "It's a very rich country thanks to its oil reserves, but enormous amounts are disappearing and the elites are unbearably rich," he said.

The EU must "confront the elites floating on their oil fields and raking in the money," said Neuser. One way it could help would be to assist with the development of efficient tax systems. The EU could also contribute by closing its many tax havens, stemming the flight of capital from Africa.

Accounting Scandal Hooks Spanish Frozen Fish Giant

Jakarta Globe – AFP, Katell Abiven, July 14, 2013

A Pescanova’s store is pictured in Vigo, northwestern Spain, on June 26, 2013.
(AFP Photo/Miguel Riopa)

Madrid. It boasts a fleet of 100 ships and 10,000 employees worldwide but suspected fraud at frozen seafood giant Pescanova is causing an embarrassing stink in export-hungry Spain.

After years of posting growing sales, amounting to 1.7 billion euros ($2.2 billion) in 2011, the group that was among the world industry’s leaders and the pride of the northern region of Galicia has plunged into scandal.

One evening in February, Pescanova was forced to reveal that it could not publish its 2012 accounts.

Two months later, on April 25, it filed for bankruptcy.

“That was a surprise,” said Francisco Vilar, regional secretary of the food-processing federation of the main union at Pescanova, the Workers’ Commissions (CCOO).

“People who work here have been here for 30, 40 years, with good management. So it was an enormous surprise.”

Pescanova is accused of false billing, hiding a debt of 3.3 billion euros that was more than double the declared figure, and its top managers of selling shares just before the scandal broke.

“It’s Enron, Spanish style,” said one banking source, referring to the giant US energy group that collapsed in the 2000s in one of the biggest financial scandals in US corporate history.

“There was a tangle of subsidiaries set up solely and uniquely to hide the debt,” the source said.

The group had more than 100 offshoots, in many of which the group held less than 50 percent of the equity to as to avoid including their debts in its accounts.

To pay for an all-out investment program, from salmon farms in Chile to prawn preparation centres in Ecuador, the group “would go to different banks in the world to ask for credit, using the image and reputation of Pescanova, and everyone gave it to them, which was logical because they were industry leaders,” said one source close to the company.

Banco Sabadell, Banco Popular, Deutsche Bank, Commerzbank, but also banks in Namibia, Bolivia, or the island of Mauritius: more than 100 banks loaned money to the frozen fish giant, which boasts of inventing refrigerated shipping in the 1960s.

Now the Pescanova president, Manuel Fernandez de Sousa, is being investigated for suspected false accounting and insider trading. Auditors Deloitte and KPMG have been tasked to look into its accounts.

‘We should have suspected something’

A KPMG report made public Wednesday was damning.

“In the last financial periods, practices were designed and set up whose object was to present a group financial debt smaller than the reality and, as a consequence, results that were larger than those actually generated,” KPMG said according to a statement to the stock market regulator.

“It is a tough lesson, we should have suspected something,” said the banking source, adding that it was difficult to see the problems in a company whose results are audited annually.

“We are speaking about a listed company, not a family business that has fewer legal obligations!” the source added.

Manuel Fernandez de Sousa, who denies any embezzlement and admits only to making mistakes, admitted in a statement that Pescanova “was created and expanded almost without capital thanks to banking credits, like the great majority of Spanish companies”.

“That has always been our weak point and it still is.”

At the end of June, the group secured an emergency loan of 56 million euros. No foreign bank wanted to take part.

“That’s not a good sign,” worried the banking source, while Spain, whose banks are being recapitalised with European financing, is struggling to regain market confidence.

The scandal “does great damage to a country’s credibility,” said Joaquin Yvancos, lawyer for more than 100 small shareholders suing the management including a US fund and investors from Costa Rica.

“We are not talking just about Pescanova but the Spain brand,” he said, adding that it came at the “worst time” when the country was trying to persuade investors to return.

“Pescanova is a multinational with a well-known brand and when this kind of thing happens it is never good,” the Spanish stock market regulator’s president Elvira Rodriguez said recently.

“It is one of the world’s main fishing groups,” said Alberto Roldan, analyst at Lloyds Bank.

“This very unfortunate affair tarnishes businesses’ efforts to be more international,” he added. “It is hard to properly measure the enormous damage caused by Pescanova to Spanish industry.”

Agence France-Presse