The European Union unveiled proposals Wednesday to revamp trade preferences for developing countries, aiming to shift tariff breaks to those that need it most.
EU Trade Commissioner Pascal Lamy said the reform would take greater account of market share in particular exports, such as textiles, when determining which countries should be eligible for the tariff reductions.
"When they have a pretty good market share, we deem they no longer need these preferences and therefore we can reallocate them to poorer countries," he said.
Large countries like China and India, the biggest beneficiaries under the current system, could therefore see some of those benefits disappear under the reform, though Lamy stressed that figures have yet to be calculated under the proposed changes.
"The practical effects of this reform ... will depend on the number which we will finally put in the draft regulations," he said. "We're not thinking in terms of countries, we're thinking in terms of market share. It could very much depend on the country and the product concerned."
The new system of preferences would run from 2006-2015 once approved by EU governments and the European Parliament.
Lamy said he hoped to introduce a regulation by October, following consultations with governments and the Parliament.
The EU reform is separate from global trade liberalization talks underway at the World Trade Organization.Associated Press Online:
