The Generalized System of Preferences
The Generalized System of Preferences, or GSP, is a formal system of exemption from the more general rules of the World Trade Organization (WTO), (formerly, the General Agreement on Tariffs and Trade or GATT). Specifically, it’s a system of exemption from the most favored nation principle (MFN) that obliges WTO member countries to treat the imports of all other WTO member countries no worse than they treat the imports of their "most favored" trading partner. In essence, MFN requires WTO member countries to treat imports coming from all other WTO member countries equally, that is, by imposing equal tariffs on them, etc. GSP exempts WTO member countries from MFN for the purpose of lowering tariffs for the least developed countries, without also lowering tariffs for rich countries.
Many of Bangladesh’s products enjoy duty-free entry under GSP, a program designed to promote economic growth in the developing world by providing preferential duty-free entry for up to 5,000 products when imported from one of 128 designated countries and territories. Of the $18.5 billion worth of products imported under the GSP program, products from Bangladesh make up only $26 million, or .54 percent of the $4.87 billion worth of products imported from Bangladesh in 2011. But, in last December, a fire in a Tazreen Fashion factory in Bangladesh left 112 workers dead and a host of U.S. lawmakers questioning whether Bangladesh should continue to enjoy preferential treatment under the Generalized System of Preferences (GSP). The United States Trade Representative (USTR) is now seeking commentary on the effects of removing Bangladesh from the list of GSP beneficiaries after lawmakers sent the USTR a letter expressing grave concern over the “deterioration of working conditions and workers’ rights in Bangladesh.”
Thus, the country’s businesses, in recent days, have become immensely worried over the US threat of possible withdrawal, suspension or limitation of Bangladesh’s duty-free
Many of Bangladesh’s products enjoy duty-free entry under GSP, a program designed to promote economic growth in the developing world by providing preferential duty-free entry for up to 5,000 products when imported from one of 128 designated countries and territories. Of the $18.5 billion worth of products imported under the GSP program, products from Bangladesh make up only $26 million, or .54 percent of the $4.87 billion worth of products imported from Bangladesh in 2011. But, in last December, a fire in a Tazreen Fashion factory in Bangladesh left 112 workers dead and a host of U.S. lawmakers questioning whether Bangladesh should continue to enjoy preferential treatment under the Generalized System of Preferences (GSP). The United States Trade Representative (USTR) is now seeking commentary on the effects of removing Bangladesh from the list of GSP beneficiaries after lawmakers sent the USTR a letter expressing grave concern over the “deterioration of working conditions and workers’ rights in Bangladesh.”
Thus, the country’s businesses, in recent days, have become immensely worried over the US threat of possible withdrawal, suspension or limitation of Bangladesh’s duty-free