The European Union (EU)

HISTORY AND PRESENT STATUS

The European Union (EU) is the culmination of European integration which started with the European Coal and Steel Community (ECSC). The ECSC Treaty was aimed at speeding up the reconstruction of Europe after World War II and at preventing a recurrence of war amongst its signatories. The founder members were France, Germany, The Netherlands, Luxemburg, Italy and Belgium. Between 1986-1995 new member states joined viz.: Denmark, Ireland, United Kingdom, Greece, Spain, Portugal, Finland, Sweden and Austria. The most prominent institutions of the EU are: the European Commission, the European Parliament, the European Council, the European Court of Justice and the European Central Bank. In December 1992 a single European market was achieved. The Maastricht Treaty of 1992 created the European Union, preparing for the introduction of a single currency and the gradual development of a Common Foreign and Security Policy (CFSP). On 1 May 1999 the single currency (Euro) came into being. The EU provides a unique institutional framework for forging unity and cooperation amongst the nations of Europe.

With the accession of new 10 members on 1 May 2004 the number of EU Member States has increased from 10 to 25. The new 10 members are Hungary, The Czech Republic, Estonia, Latvia, Lithuania, Poland, Slovenia, Slovakia, Malta, and Cyprus.

EU RELATIONS WITH SOUTH AFRICA

South Africa has maintained a diplomatic Mission to the European Communities in Brussels for more than two decades. On 14 December 1993, after the establishment of the Transitional Executive Council, an Agreement for the Establishment of a Delegation of the European Commission in South Africa was signed in Brussels. For historical reasons the EU has always been a major investor and trading partner of South Africa, but because of opposition to apartheid this relationship was not formalised prior to 1994.

The European Parliament has always shown a lively interest in South Africa and supported its democratisation. In this regard AWEPAA (formerly Association of Western European Parliamentarians Against Apartheid) was particularly active. Since South Africa's transition to democracy, the dialogue between the European and South African Parliaments has become institutionalised with frequent reciprocal visits of parliamentarians, also in the context of the EU/ACP Joint Assembly and the EU/SADC exchanges.

The European Programme for Reconstruction and Development (EPRD) which currently channels about R900 million (127,5 million euro) per annum into development efforts in South Africa, makes the EU one of South Africa's most important donors (from 1995 to 1998 the EU provided 43% of all foreign grant aid to South Africa). The European Investment Bank (EIB) involvement is a recent development. Following the request from the Council and the decision of the Bank's Board of Governors of June 1995, the Bank signed a Framework Agreement with South Africa in September 1995 covering a lending facility of 300 mecu, to be committed over two years, (June 1995-June 1997). A second Framework Agreement was signed on 4 March 1998 and provided for a facility of 375 million euro for the period 1998-2000.

A forum referred to as the Co-operation Council, comprising officials from the South African government and from the European Commission, was established to monitor the implementation of the TDCA. Both South Africa and the European Commission are in the process of formalising political dialogue referred to in the TDCA.

The EU thus proposed a two-pronged approach of qualified accession to the Lome Convention (since replaced by the Cotonou Partnership Agreement (CPA), signed in Cotonou, Benin in June 2000).

In addition another associate agreement on Scientific and Technological Co-operation between South Africa and the European Community was concluded in 1996 and signed in 1997. The agreement allows for participation of South African researchers and research entities in projects under the European Community Framework Programmes for research and technological development and a reciprocal participation of researchers and research entities of the European Community in South African projects. A Joint Science and Technology Co-operation Committee (JSTCC), composed of representatives from South Africa government and the European Commission was established to administer the Agreement.

Negotiations on Fisheries Agreement have been suspended pending finalisation of a framework that would address South Africa’s concerns regarding access to its resources.

During the rounds of negotiations, the negotiators were guided by three principles. Firstly, the agreement had to be WTO compatible, i.e. substantially all trade in all sectors had to be covered. Secondly, the agreement had to be asymmetrical, i.e. the EU as the developed partner would open up its markets faster in respect of content and access than South Africa, the developing partner, would. Thirdly, the agreement had to be to the benefit of the whole of Southern Africa. After twenty one formal sessions of negotiations, South Africa and the EU in December of 1998, reached broad agreement on the contents of the TDCA. In addition to the tariff liberalisation schedule, agreement was reached on the numerous articles dealing with trade related issues such as intellectual property rights, competition policy and rules of origin. The parties also agreed to cooperate in a number of non-trade fields, such as the fight against drugs and money laundering and the protection of data.

The central component of the agreement revolves around a tariff phase-down schedule for agricultural and industrial products. In terms of this agreed schedule, South Africa will eliminate tariffs on 86% of EU exports to South Africa, over a period of twelve years. The EU in return will eliminate tariffs on 95% of South African exports to the EU, over ten years. The TDCA has to be ratified by all fifteen Member States. To date the TDCA has been ratified by 10 EU Member States. Luxembourg, France, Austria, Italy and Greece have still to finalise the process of ratification.

South Africa's bilateral relationship with the EU has been elevated to a higher level, with effect from 1 May 2004, with the commencement of full implementation of the SA-EU Trade, Development and Co-operation Agreement (TDCA), subsequent to final ratification of the Agreement by the Parliaments of all 15 EU Member States. The new EU Member States will adopt the Agreement as part of Community legislation (EU).

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