Pretoria cash to come from food aid fund

Date: 22/06/2000

By Simon Taylor

THE European Commission is planning to squeeze money from the EU's emergency food aid budget to meet the European Parliament's demands for more funds for a free-trade agreement with South Africa.

Commission officials have confirmed that the extra €35 million required will come from the Union's €3.46-billion budget for emergency food aid. "It is a drop in the ocean. It really will not be noticed," insisted one.

The move comes after EU governments bowed to a request from MEPs to increase funding for the accord from €849.5 million to €885.5 million last week. The Parliament called for the extra money to finance a range of projects under the seven-year trade and development package, which was finalised last year after lengthy negotiations.

A number of member states, including Spain, had argued against increasing the funding, but withdrew their objections following a late breakthrough in controversial talks with South Africa on a wine and spirits accord last week.

Approval of the overall trade agreement had been on hold because of opposition to South Africa's stance in these negotiations from Spain, Portugal, Italy and Greece. They wanted to ensure that Pretoria would phase out the use of certain brand names which the Union believes exclusively apply to traditional drinks such as grappa and ouzo.

The Commission has now succeeded in settling a number of outstanding issues relating to safeguards for EU-owned brands in multilateral trade accords such as the World Trade Organisation's agreement on intellectual property rights. The two sides also agreed to set up procedures for identifying potential trade disputes by the end of this year and set a deadline for phasing out certain trade names.

Commission officials said they were confident the latest agreement would be approved.

The European Commission is planning to squeeze money from the EU's emergency food aid budget to meet the European Parliament's demands for more funds for a free-trade agreement with South Africa.