Trade Development
Authority of Pakistan
The Generalized System of Preference (GSP) is a system where by preferential treatment by way of a reduced or duty free tariff rate is granted by developed countries known as preference giving or donor countries to developing countries known as beneficiary countries. The preferential treatment is granted without any reciprocal obligation on the part of developing countries.
The main objectives of GSP are:-
a). To increase the export earning of the preference receiving countries.
b). To promote their industrialization.
c). To accelerate their rate of economic growth.
The new GSP Scheme for industrial products entered into force from 1st January 1995 and will operate upto 2004.
The new GSP scheme has no preferential limits. The earlier quotas fixed duty free amount or set ceilings which restricted the volume of exports benefiting from reduced duties have been abolished. Duty reduction is modulated depending upon the sensitivity level of each product and has been divided in the following four categories.
Covers essentially Textiles and Clothing
Covers Leather-and Leather goods, footwear.
Imitation Jewellery, Electrical goods and some articles of leather.
IV NON SENSITIVE PRODUCTS
Covers wooden furniture, toys, game and sport goods.
A new GSP scheme for agriculture products was also introduced last on the same pattern.
SUSPENSION AND SAFEGUARDS.
The new GSP scheme includes a safeguard clause which could suspend the preferences in exceptional circumstances which cause or threaten to cause serious difficulties to community industry.
Temporary suspension of the scheme could also be initiated on account of unfair trade practice, forced or child labour or failure to comply with international conventions on money laundering or transit of drugs.
GSP Schemes are in operation in the following countries.
E.E.C.
Belgium, Denmark, Germany, Ireland, Italy, Luxembourg, Netherlands, United Kingdom, Greece, Spain, Portugal and France.
Some other countries also extend this facility to developing countries. These are
Finland, Japan, Newzealand, Sweden, Switzerland, U.S.A., Bulgaria, Hungary, Czechoslovakia, Poland, Russia, Central Independent states (CIS), Austria, Canada, Norway, Australia, Romania.
For details please visit Trade Development Authority and its Regional Offices.