Malawi Won't Sign EU Deal Unless Help Offered, Trade Minister Kazembe Says

Malawi won’t sign a trade deal with the European Union until the union helps the southern African country bring production standards to European companies’ level, Trade Minister Eunice Kazembe said.

Malawi, which has unreliable public utilities and poor technology standards, stands to lose should it sign the so- called economic partnership agreements as it would be forced to trade with the EU on zero-tax terms, Kazembe told reporters yesterday in the commercial capital, Blantyre.

“We need to move cautiously otherwise the Malawi market will be flooded with European goods,” she said. “We want the EPAs to be of mutual benefit for the economic development of both sides.”

Peter Thompson, the European Commission’s director for development, said Malawi should show interest in continuing with the negotiations by making an offer that would lead to the two parties discussing how trade can be facilitated.

Malawi participates in the EU’s so-called Everything But Arms initiative, which is designed to boost the economies of African, Caribbean and Pacific countries by allowing them to export goods into the EU duty-free area. Malawi is content with the EBA and sees no reason to hurry into signing the EPAs, Kazembe said.

The Malawian unit of Illovo Sugar Ltd., Africa’s biggest producer of the sweetener, last year said the country’s delay in signing the economic partnership agreements with the EU had reduced profit levels for the company and means it could only sell it sugar to regional markets which are less lucrative compared with European markets.

To contact the reporter on this story: Frank Jomo in Blantyre via Johannesburg at pmrichardson@bloomberg.net.

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