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Conculsions of the Euro-Mediterranean Trade Ministerial Conference - Palermo, 7 July 2003

The Third Euro-Mediterranean Trade Ministerial Conference took place in Palermo, Italy on 7th July 2003. This Conference aimed to give impetus to the trade dimension of the Euro-Mediterranean Partnership, building on the achievements of Brussels in 2001 and Toledo in 2002. Palermo allowed Ministers to review and take of stock of the progress made in the various trade related fields of the Barcelona Process and to provide future orientations.

Ministers noted that there had been significant achievements since their last meeting in a number of areas, (for example origin and trade facilitation). Ministers re-affirmed their commitment to the fundamental principles of the Barcelona Declaration. They emphasised that the economic development of the Mediterranean countries requires competitive market economies, regional integration and co-operation between all Euromed countries. Ministers remained committed to an approach that focused on pursuing concrete and pragmatic goals to complement trade liberalisation and thus contribute to the creation of a Euro-Mediterranean Free Trade Area.

1. Euromed Ministers had a full exchange of views on the state of preparation of the Cancun Ministerial meeting after the mini ministerial of Sharm-el-Sheik. They reiterated their commitment to the successful conclusion of the DDA negotiations by the end of 2004 with a balanced outcome in the areas of market access and of rule-making, which will reflect the interest of all parties and which must bring tangible development benefits. Ministers underscored their great convergence of views on the DDA and agreed to work closely together for a successful Cancun ministerial Conference. Ministers also exchanged views on the positive impact of the WTO Round on the Euromed Partnership, the integration of economies around the Mediterranean and the economy and trade of the South Mediterranean countries. They also reiterated their support for the early accession of Algeria, Lebanon and Syria to the WTO.

2. Euromed Ministers took stock of several positive developments concerning the Euro-Mediterranean Association Agreements. The grid of bilateral agreements is now close to being completed. Since the Toledo Conference, Association Agreements with Algeria (April 2002) and Lebanon (June 2002) have been signed. The EU-Jordan Agreement entered into force in May 2002 and the interim EU-Lebanon Agreement entered into force in March 2003. An EU-Egypt Interim Agreement is in the process of being finalised and negotiations with Syria are in progress. Thus, of the twelve Med partners, four of the Association Agreements (Tunisia, Morocco, Israel, Jordan) and two Interim Agreements (Palestinian Authority, Lebanon) have now entered into force. Turkey has a customs union agreement with the EU. Cyprus, Malta will join the EU in May 2004.

Regarding the south-south dimension, Trade Ministers welcomed the initialling of the Agadir Agreement between Egypt, Jordan, Morocco and Tunisia in January 2003 and encouraged the participants to conclude the agreement as soon as possible. The Agadir Agreement is an initiative launched in May 2001 to create a regional free trade area. Ministers also welcome positive developments in the negotiation of FTAs between Turkey and Egypt. Ministers stressed that a critical mass of implemented free trade agreements between the Med partners themselves is essential if the Euromed Partnership is to acquire a genuine south-south dimension. Ministers encouraged the Mediterranean countries to continue to work towards concluding Free Trade Agreements amongst themselves.

3. Euromed Ministers endorsed the new Protocol on rules of origin which allows extension of the pan-european system of cumulation of origin to the Med countries. The harmonisation of rules of origin in the Euro-Mediterranean area represents a major step forward for the trade chapter of the Barcelona Process, since it will significantly facilitate trade in the Euromed region and contribute to the creation of a Free Trade Area. Cumulation of Origin will improve market access for economic operators, increase incentive for investment and strengthen regional economic integration between Euromed partners. Ministers congratulated the Working Group on Rules of Origin for completing the work efficiently and noted its report. All partners concerned should now take steps to insert the new protocol both in their present agreements and in the agreements yet to be concluded (e.g. Agadir). Given that the protocol has now been finalised and that the Working Group has fulfilled its mandate, it needs not convene any longer. Future issues of implementation will be dealt with in the framework of the already existing Pan-European Group of experts, which will be extended to include the Mediterranean partners.

4. Ministers reaffirmed the objective of liberalisation of trade in services across the Euromed area, taking into account the obligations arising from GATS article V. They emphasised that trade liberalisation of trade in services would create extensive opportunities.

Ministers took note of the progress achieved in the Working Group on Services (in particular the sectoral discussions) and agreed that these discussions constituted a useful stage in preparing the ground for liberalising trade in services.
Ministers agreed on establishing a Framework Protocol for the liberalisation of trade in services common to all Euromed Partners and endorsed the main principles (defined in annex to the report of the WG) upon which such a Framework Protocol should be based.

To this end, they instructed the Working Group on Services to draw up this Framework Protocol and to report on the progress achieved at the next meeting of the Euromed Trade Ministers.

5. Regarding trade facilitation, Ministers adopted a set of recommended measures in the field of the simplification of customs procedures to be implemented by the Mediterranean countries. These measures cover three broad areas:
a) Legislation and procedures,
b) Administrative co-operation
c) Relations with economic operators. Ministers agreed that these recommendations should be regarded as priority actions that Med countries should seek to implement swiftly, underlining that these measures would support both regional integration and the forthcoming WTO negotiations on trade facilitation.

It was also agreed to review the progress achieved in implementing these recommended measures at the next Euro-Mediterranean Trade Ministerial Conference.

Ministers encouraged Med countries to fully utilise existing MEDA programmes, such as the Euromed Market Programme, in particular with a view to encouraging greater participation of small and medium size enterprises.

They emphasised that an improvement in the business environment in the Med countries is essential to attracting greater investment and ensuring an increase in regional trade. This may include also the organisation of specialised trade fairs for Mediterranean enterprises or the facilitation of their participation in existing events.

6. In line with the Action Plan on Trade and Investment Facilitation adopted at the Toledo Conference in March 2002, Euromed Ministers instructed the existing Working Group on Trade Measures Relevant to Regional Integration to begin to address the approximation of legislation in the field of standards, technical regulations and conformity assessment procedures. They instructed the Working Group to implement a Six Point Work Programme that defines the steps required to approximate legislation in this field.

The six points are:
1) Identification of priority sectors
2) Acquaintance with the applicable EC legislation and conduct a gap analysis on the basis of the existing legislation;
3)Transposition of the necessary framework legislation and sectoral legislation;
4) Creation/ Reformation of existing institutions
5) Set up necessary certification and conformity assessment bodies;
6) Identification of technical assistance needs and make most of existing programmes. Ministers requested that a report is presented at the 2004 Trade Ministerial to assess the progress of the Working Group.

7. Euromed Ministers exchanged views on the implications of the EU’s Enlargement for Euromed Trade relations and emphasised the positive impact that Wider Europe could have on the Euro-Mediterranean Partnership. Ministers emphasised that EU enlargement entailed challenges for the Euro-Mediterranean Partnership but it also brought with it many opportunities for co-operation and partnership that could be exploited by the Med countries. A Wider Europe can also reinforce the trade dimension of the Barcelona Process by further encouraging Med partners to engage in trade liberalisation, regional integration and regulatory convergence.

8. Ministers agreed to meet again in 2004 and envisage the possibility that the Euromed Conference will take place in a Mediterranean country.

Brussels,07 15 2003
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