Regional Trade Agreements in the ECE

CEFTA BOOSTING TRADE BALANCES

The signatories of the CEFTA agreement say that all the indicators concerning its application point to increased trade between the countries in question. The participants at a meeting in Podgorica underlined that “the concrete problems with application of the agreement are of a narrowly technical nature,” and were related to insufficient knowledge of the rules on the origin of goods, which is the jurisdiction of customs administrations. Customs representatives from the Central European Agreement on Free Trade (CEFTA) signatory states discussed cooperation on these rules, improved cooperation with companies with the aim of increased knowledge of the procedures for receiving certificates on the origin of goods, as well as harmonizing legislation with EU regulations.

SOUTHEASTERN EUROPEAN COUNTRIES SIGN FREE-TRADE PACT

Albania, Bosnia-Herzegovina, Serbia, Montenegro, Moldova, and Kosova signed the Central European Free Trade Agreement (CEFTA) at a ceremony in Bucharest, Romania, on December 19, dpa and Makfax reported the sameday. The UN Mission in Kosovo (UNMIK) signed on behalf of Kosova. Prior to the enlargement, the CEFTA comprised Romania, Bulgaria, Croatia, and Macedonia. Romania and Bulgaria will leave in January to join the EU (see "RFE/RL Newsline," December 5 and 18, 2006). CEFTA,widely seen as a training ground for EU membership, harmonizes trade rules among its members. "We are opening a new chapter in the history of our region," Romanian Prime Minister Calin Popescu-Tariceanu said at the ceremony. "The European Commission supports the new accord on free trade, which is in line with the European integration process," he added.

SERBIA TO SIGN CEFTA

Serbia has initialed the Central European Free Trade Agreement (CEFTA) and indicated that it plans to sign the pact formally in the coming week, UPI reported on December 15, citing the Beta news agency. Serbia is to sign the agreement on December 19 in Bucharest, Romania, Beta reported on December 15. The CEFTA -- which currently comprises Romania, Bulgaria, Croatia, and Macedonia -- is considered a step toward EU membership. Romania and Bulgaria will leave the bloc in January to join the EU, leaving Croatia and Macedonia as the sole signatories. Albania, Bosnia-Herzegovina, Serbia, Montenegro, Moldova, and Kosova have until December 19 to agree to join.

CEFTA Expansion Progresses

Current members of the Central European Free Trade Agreement (CEFTA) - Bulgaria, Croatia, Romania and Macedonia - could soon be joined by Albania, Bosnia and Herzegovina, Serbia, Moldova and Montenegro, as well as by UNMIK/Kosovo, after all negotiating parties made significant progress towards amending the 13-year old text and enlarging the agreement. This was said in an official statement from Brussels posted on the Stability Pact for South Eastern Europe website on September 15. The new text, known in its draft form as CEFTA 2006, is a trade agreement that incorporates new provisions such as trade in services, intellectual property rights, public procurement and investment promotion and is in line with the rules of the World Trade Organisation and with the parties’ obligations towards the EU.

Meeting for three days in Brussels, the third round of negotiations, chaired by the Stability Pact and hosted by the European Commission, made considerable progress, tackling areas such as competition, rules of origin and technical barriers to trade. Some bilateral trade issues must now be resolved before the parties meet for the final round/legal review on October 19 and 20 in Brussels, the statement said. The need to ensure the full implementation of the agreement was also discussed and parties made progress regarding the proposal to have a small secretariat to support the implementation of the agreement.

Up to now, CEFTA was the only multilateral trade agreement without an administrative body and taking into account the scale of the expansion of membership and the number of new and complex trade areas, this is now being reconsidered. At a meeting in April, the Special Co-ordinator of the Stability Pact for South Eastern Europe, Erhard Busek, challenged the countries of South Eastern Europe to achieve a modern, ambitious and inclusive agreement to create a Regional Free Trade Area in South Eastern Europe. Speaking at the South Eastern Europe Summit in Bucharest where negotiations on the creation of a single free trade area in South Eastern Europe were launched at the highest political level, Busek said that the summit was an excellent demonstration of political willingness of all to move forward together both economically and politically.

The summit adopted a declaration committing all countries and territories to the creation of a single free trade area in South Eastern Europe by means of enlarging and modernising the current CEFTA agreement.  The new agreement will include modern trade policy provisions on competition rules and state aid, government procurement and protection of intellectual property.  All SEE countries and territories agreed to initiate formal negotiations by May 31 this year under the auspices of the Stability Pact and to conclude them at the latest by December 31 2006.