European Union Opens Its Market To Palestinian Exports

High Representative for Foreign Affairs and Security Policy/Vice President of the Commission Catherine Ashton today on behalf of the European Union signed an Agreement with Prime Minister Fayyad that gives all agricultural products, processed agricultural products and fish and fishery products originating in the West Bank and Gaza Strip immediate duty free access to the EU market.

The only exception from full liberalisation is the specific duty for imports of fruit and vegetables under the entry price system. This duty will remain applicable if these entry prices are not respected.

“Facilitating Palestinian trade is a crucial element of the state building process which the EU is supporting both politically and financially. This agreement is the tangible expression of our support,” said Catherine Ashton on the occasion of the signing of the agreement which has the form of an Exchange of Letters.

“This agreement is good news for Palestinian farmers and the wider economy as it provides free access for their agricultural exports to tap into our market of 500 million consumers.” highlighted Commissioner for Agriculture Dacian Cioloş.

“This agreement came about thanks to a genuine and collective commitment from the EU to improve its trade offer in support of the Palestinian economy. More can still be done, on a bilateral, regional and even multilateral level. I would expect to see further trade expansion firmly rooted in a conducive political environment and in visible social and economic gains for the Palestinian people” stressed Commissioner for Trade Karel De Gucht.

The agreement will give immediate access and full liberalisation, for a transitional period of 10 years to the EU market, with possible further extension in time, to all agricultural products, processed agricultural products and fish and fishery products originating in the West Bank and Gaza Strip.

A review clause is envisaged after 5 years as of entry into force.

The only exception is the specific duty for imports of fruit and vegetables under the entry price system that will remain applicable if these prices are not respected. The agreement also envisages new provisions on effective administrative cooperation and assistance, in order to ensure that only Palestinian products will benefit from this specific arrangement.

Under the framework of the Barcelona Process and in accordance with the Euro-Mediterranean Roadmap for Agriculture (Rabat roadmap) adopted on 28 November 2005, the European Commission entered into negotiations with the Palestinian Authority of the West Bank and Gaza Strip on further liberalisation of trade in agricultural products, processed agricultural products and fish and fishery products. The current Interim Association Agreement already provides for duty-free access to EU markets for Palestinian industrial goods and industrial products.

The Palestinian Authority is the smallest trading partner for the EU in the Euro-Mediterranean region and almost worldwide, with total trade amounting to € 56.6 million in 2009 where the vast majority of it is accounted for by EU exports (€ 50.5 million). EU imports from the Palestinian Authority amount to just € 6.1 million in 2009 and consist mainly of agricultural products and processed agricultural products (approximately 70.1 % of total EU imports). Further market opening on the EU side is expected to support the development of the economy of the West Bank and the Gaza Strip through increased export performance.