Brussels, 13/06/2001 (Agence Europe) - As EUROPE briefly announced (see yesterday's EUROPE, p.8), the European Commission proposes reviewing the generalized tariff preferences scheme (GSP) during the 2002-2004 period in such a way as to render it simpler, more attractive and beneficial for developing countries, while encouraging them to respect social an environmental standards established by the international community. This approach, which comes "on the eve of Doha, confirms the priority the Union intends providing, through the New Round, to the integration of developing countries in the world economy in view of fair and more durable development", commented Commissioner Pascal Lamy when presenting the proposal in Strasbourg.
The updating of an old system of just thirty years responds to the threefold concern, the Commissioner for the common trade policy, stressed, in reference to the need to: - compensate for the erosion of preferences due to the general fall in tariffs that has resulted from the different rounds of trade negotiations; - simplify tariff modulation linked to the sensitivity of products, only to retain two categories (sensitive and non-sensitive) instead of four, thereby facilitating the work of operators and customs; - proceed with "graduation", i.e., withdraw the benefit of the system from countries with high GDPs whose products are becoming more competitive, which "opens up new prospects for exports of other, less competitive developing countries and thereby contribute in combating poverty".
The regulation being proposed to the Council and European Parliament thus aims to "simplify the GSP scheme, reestablish the level of advantages (returning preferential margins to their initial level: Ed) and target them more effectively", Lamy summarized, also citing the aim of strengthening existing social and environmental incentives, the whole being "a central element of the EU's trade policy and an new tangible example of the promotion of sustainable development" Lamy stipulated that by proposing this "aggiornament" of the GSP, the Commission's concern was to "find the right balance between the need to provide a new positive signal to developing countries to show them our determination to respond to their expectations regarding market access and the interest of retaining significant additional possibilities of openness for multilateral negotiations", even though concessions made in a multilateral framework presented in themselves the advantage of being "sure and stable", whereas a unilateral preference "remains precarious".
The main changes planned for the last two years of the present scheme, are:
1. simplification of the rule and harmonization of procedures of the different existing schemes in the framework of the GSP, which are: a general scheme for the countries of Asia and Latin America (the only ones not to benefit from bilateral preferential schemes like those reserved for the ACP and Mediterranean countries): the LDCs scheme (least developed countries), already radically improved through the "Everything but arms" initiative that the new regulation will complement and fully integrate; the social and environmental incentives (additional tariff cuts); the special drugs scheme for the countries of the Andean Pact and Central America which is extended as it stands for a three-year period. In all cases, tax-free access is maintained for non-sensitive products, whereas the other products will be grouped into a single "sensitive" category instead of three, and benefit from a lump reduction of 3.5 point in relation to the level of the standard duty.
2. better targeting to the benefit of countries and sectors which have most need of preferential treatment and more flexibility on admissibility that would be decided, no more at the time of the coming into force of the new scheme, but on an annual basis. The performances of the beneficiaries will nevertheless be judged on three years, to provide the with an early warning and maintain the system's predictability.
3. The doubling of advantages already procured by the general scheme to countries genuinely implementing fundamental work standards, with the perpetual threat for those committing "serious and systematic violations" of ILO Conventions of losing their status as beneficiaries. Likewise for environmental standards. As for the drugs scheme (qualified by Lamy as "very generous, close to the TSSA scheme for LDCs") that is also the "Union's main contribution to combating drugs", it is being maintained until the end of the current GSP cycle in 2004 and goes together with a "scrupulous process of control and evaluation of efforts deployed by each beneficiary not only to combat their production of drugs and drug trafficking but also in satisfying work and environmental standards".