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SAfrica holds back signing trade pact with EU

South Africa said Wednesday it would not sign a new trade pact with the European Union until its concerns over possible "detrimental impacts" new accords could have on Africa had been addressed.

"South Africa is very much opposed to the inclusion of certain trade and services clauses in the new accord that the European Union wanted.

"We objected to that because we thought that the impact … to Africa will be detrimental," foreign ministry deputy director general Gert Grobler told journalists.

The European Commission and the 78 African, Caribbean and Pacific countries making up the ACP group are struggling to clinch new agreements by December 31, when current preferential trade and tariff conditions expire.

The new agreements would require ACP countries to gradually open their markets to European goods in exchange for open access to European markets from January 1, 2008, with the exception of rice and sugar.

Existing trade agreements giving preferential market access to the former colonies have to be replaced by the end of the year because the World Trade Organisation (WTO) has ruled that they were illegal.

"They (EU) are expecting too much from African countries and we feel that it will have a devastating effect on Africa," said Grobler who said he expected the issue to be raised at this weekend's EU-Africa summit in Lisbon.

"The EU has been negotiating with a number of regional communities, such as the SADC, to arrive at a good accord," Gobler said.

An "interim" accord on the issue was signed late last month by only four southern African countries, Botswana, Lesotho, Swaziland and Mozambique, he said.

"South Africa did not sign. The process (of negotiations) is ongoing. Solutions will have to be found on how we can take the process forward. It is a complicated and complex issue," he said.

If new trade deals fail to take effect in January, the wealthier African nations, including Kenya, South Africa and Nigeria, will automatically face a specific band of tariffs set by the World Trade Organisation.