Brussels, 15/04/2003 (Agence Europe) - On 12 May the Council should adopt, without discussion, a revision of the system of generalised preferences that will allow for the taking into account of economic crisis in a country before withdrawing customs preferences for their competitive products. In fact, on Monday, the Council approved an agreement concluded to this effect by the permanent representatives of the member states.
Enforced as of next 1 November, the revised regulation will permit for the exemption of countries experiencing a crisis from the tiered system, which ends customs benefits from the SGP for products that have become competitive. The 'financial clause' will apply when the GDP of the country concerned records a fall of 3% in real terms.
A joint statement from the Council and the Commission adds that the implementation of the tiered system for the 'SGP drugs' will be re-examined, in the framework of the systems revision that will begin on 1 January 2005. In order to promote the transition of drug producers towards other profitable export crops, additional tariff preferences have been defined in the framework of the so-called 'SGP Drug' system. During the negotiation within the Council, the United Kingdom, Spain and Sweden, among others, noted that the exclusion of competitive products such as fruits and vegetables, or cut flowers, on a tiered basis, was politically contradictory with the aims of the SGP. However, the Commission defended the tiers, underlining that the preferences granted notably to Pakistan in this framework are challenged by India before the World Trade Organisation.