EU trade scheme offers better access to poor countries

Date: 03/04/1997

By Mark Turner

THE world's 50 poorest countries may win freer access to EU markets if national governments accept proposals due to be adopted by the European Commission next week.

Building on moves to help the 'least developed countries' (LDCs) within the World Trade Organisation, Trade Commissioner Sir Leon Brittan will suggest various tariff reductions, new rules of origin and technical assistance programmes.

The United Nations defines LDCs on the basis of gross domestic product per capita, quality of life and economic diversification. Those currently qualifying include much of sub-Saharan Africa, and Asian countries such as Afghanistan, Bangladesh and Cambodia.

Most of these countries already have tariff- and quota-free access to the EU in industrial goods under the Lomé Convention or Europe's generalised system of preferences (GSP).

But in some industrial sectors, such as leathers, skins and non-ferrous minerals, they still face substantial obstacles and the LDCs' agricultural produce is all but barred from the Union.

Under Brittan's proposals, the EU would allow greater market access for industrial products and aim to bring privileges given to GSP countries closer to those provided by the more favourable Lomé Convention.

Under the Union's current rules of origin, countries are discouraged from importing semi-finished components and assembling them for export, with the EU arguing that only those adding significant value to products should be rewarded.

But Brittan will call for these rules to be relaxed, reflecting a growing acceptance that LDCs such as Bangladesh do not, in practice, have much option. That may provoke a sharp reaction from more protectionist EU countries such as France.

Under the Commissioner's proposals, the Union would also step up its technical assistance programmes to the LDCs, helping them build capacity, improve standards and set up distribution networks.

But until the Common Agricultural Policy has been reformed, the LDCs will almost certainly have to wait for significantly greater access to EU food markets.