Who’s Really Benefiting? – Euro-Mediterranean Partnership versus EU Generalized System of Preferences

Written by | Monday, April 14th, 2014

The European Union has a clear ambition towards developing countries: their integration into the world economy, including through the progressive elimination of trade restrictions. In order to enhance their trade interests in industrial and agricultural products, the EU provides developing countries with reduced tariffs under preferential trade arrangements with the aim of promoting industrialization and accelerating economic growth. However, not all developing countries benefit from the same market access conditions in the context of the export of their agricultural products into the EU.
An important cleavage has developed between the countries sharing strong economic and historical links with the EU that have special preferential arrangements and the balance of the world’s developing countries that remain outside these schemes. It is particularly interesting if we look closely at the preferential access obtained for agricultural commodities from developing countries to the EU market under the Euro-Mediterranean Partnership (EMP) and the EU Generalized System of Preferences (GSP) – namely states in the African, Caribbean and Pacific (ACP) regions – in order to analyze, from a legal perspective, the issue of EU preferential and non-preferential trade status for agricultural food commodities.
Officially, the EU uses its trade policy to help developing countries integrate into the world economy by seeking to improve EU market access for the latter’s agro-food products through tariff reductions offered under preferential trade arrangements. However, not all countries benefit from the same degree of market access. Following the comparative analysis of the GSP and the EMP systems, there is no doubt that as far as trade in agricultural commodities is concerned, EU preferences granted under the GSP system are less advantageous compared to those granted to Mediterranean developing countries. For instance, while the average ad valorem duty is set at 10.38% for fresh grapes from GSP countries, it is set at 0.26% for TMCs.
Moreover, while the GSP scheme is unilaterally granted by the EU, the Euro-Mediterranean Association Agreements (EMAAs or EuroMed Association Agreements), between the EU and each Mediterranean partner of the EU, are contractual agreements. Signatory members are thus ensured access to EU market and are considered as “partners”. Mutual commitments provided under these schemes are negotiated whereas GSP countries have to accept the situation as presented by the EU. In the view of Robert Keohane, a respected American political scientist, “reciprocity is […] often invoked as an appropriate standard of behaviour which can produce cooperation among sovereign states.” However, he acknowledges that it could also have some limitations in that it may be defined and interpreted differently by different states. Moreover, EMAAs offer better tariff reductions to sensitive agricultural products than the GSP scheme. For example, in the case of processed tomatoes, the GSP general arrangement rate is set at 10.9%, whereas Morocco, under the EMP, would benefit from duty-free access to the EU. Trade conditions, safeguard clauses and suspensions mechanisms contained in EMAAs are also less restrictive.
In a parallel manner, the EU also uses its trade policy to promote its values and all EU’s relations with developing countries are informed by respect for human rights. However, while such condition for preferences is clearly stated in both schemes, GSP countries seem to be more affected than Mediterranean countries. On the one hand, the EU imposes, as a pre-condition for benefitting from additional tariff reductions under the GSP+, the ratification of core international conventions on human rights. On the other hand, GSP+ beneficiaries must promise to accept and comply fully with the monitoring and review mechanism envisaged in the conventions. In addition, whilst the EU will not hesitate to temporarily remove preferences to any non-compliant GSP countries, it seems to shy away from applying economic sanctions to overcome the current issues of human rights within the Mediterranean region. However, due to recent series of uprisings in the North Africa and Middle East regions, it remains to be seen how the incumbent regimes will deal with the EMP as it currently stands.
In contrast to the GSP countries, the relationship between the EU and Mediterranean countries is based on a “spirit of partnership” and, in line with the Barcelona Declaration, the EU must engage in political dialogue with its Mediterranean partners with regards to human rights issues. The EU has strong links with Mediterranean countries and has more interests in the region than in GSP countries as a whole. So, it may be fair to say that the EU prefers to adopt peaceful approaches over conflictual strategies with Mediterranean countries. However, a similar mediation option should also be used over coercion with GSP countries if the EU is to be more consistent with its claim of ‘freer and fairer’ trade.
A legal comparison between the GSP scheme and the EMP thus confirms the important divergences existing between GSP countries on one side and the EMP on the other side. However, the gap between the degree of integration of GSP countries and Mediterranean countries within the global market has been deepened by the non-trade related issues requirements and the EU’s different ambitions towards developing countries. GSP countries, which do not have the possibility to trade under other more advantageous preferential arrangements, will continue to suffer from trade restrictions, unless they are being reoriented towards regional agreements. That would mean for the EU to create more regional trade groupings.

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