Strasbourg, 3 May 2022

INTA The International Trade Committee on Tuesday endorsed the update of the EU’s preferential trade arrangement with developing countries, insisting on clearer plans of action.

The draft report about the new rules for the generalised scheme of preferences (GSP) was adopted by the Committee on International Trade by 33 votes, no votes against and eight abstentions. In another vote of 40 votes for and one abstention, the committee decided to enter into negotiations with the member states on the basis of the draft report.

GSP is a system of lower import duties for products coming into the EU from developing countries. The current GSP regulation expires at the end of 2023.

The Trade Committee agreed with the overall goals of the scheme: poverty eradication and the integration of beneficiary countries into the world economy, while promoting sustainable development and good governance.

Ratification of core conventions in five years

To benefit from one of the different arrangements under the GSP, countries must ratify and respect the basic principles of a series of core conventions on human and labour rights, good governance and the environment. The committee complemented this list with three further conventions relating to the International Criminal Court and to political and civil rights including the abolishment of death penalty.

More efficient monitoring for GSP+

Countries benefiting from the GSP+ status (which provides an even greater access to EU market) are subject to close monitoring of how the conventions are put into practice. The country and the Commission should agree detailed and time-bound plans of action before the applicant can receive the status, trade MEPs say. During the monitoring of how the plan is implemented, individuals, the private sector, civil society and trade unions should be closely involved: they should be able to contribute with observations. The more publicity and transparency on the commitments taken by the beneficiary countries, the higher the chances they can deliver in a satisfactory way, trade MEPs say.

Withdrawal a last resort

With an eye on keeping GSP attractive to participating countries, trade MEPs insist that withdrawal of preferences should remain a measure of last resort, preceded by a phase of active dialogue if serious and systematic violations are detected. The Committee therefore decided to clarify the enhanced engagement procedure, which would set clear measures and necessary steps for a beneficiary country to correct course and thus ensure its preferences are not withdrawn. If Commission decides to end the preferences, it should state the grounds of withdrawal publicly and set benchmarks for the reinstatement of the preferences, they say.

Quote

“The GSP must be squarely focused on the core objectives of poverty eradication, sustainable development and diversification of economies. This is a major opportunity to improve the lives and livelihoods of over two billion people. To attain these goals, the emphasis is rightly put on major improvements to the scheme’s predictability, transparency and the formal involvement of civil society and stakeholders in its oversight”, said Rapporteur Heidi Hautala.

Next steps

The decision to enter into negotiations with the Council and the Commission will be announced at the opening of the next plenary session (18-19 May). If MEPs object, the decision will be put to the vote.

Background

In place since 1971, the EU GSP comes in three different forms depending on the income level of the countries and the progress they make in the area of human and social rights and good governance. The scheme currently covers more than 60 countries and two billion people. The new regulation is set to be in effect between 2024 and 2033.