SLIDE 41: Compare trade preferences under GSP/GSTP with trade preferences prescribed by MFN
GSP/GSTP MFN
Unilateral tariff preferential program
offered by developed countries to
developing and underdeveloped
Definition
countries.
- Preferential: Tax rate is lower or
equal to 0% for a specific list of goods.
- Conditions: Based on criteria on the
level of economic development, per
capita income, and export situation of
Characteristic the beneficiary country.
- Process: The procedure for applying
for GSP/GSTP certification is relatively
simple.
Exporting businesses need to apply for
Application
a GSP/GSTP Certificate of Origin (C/O)
process
to enjoy tax incentives
- Enhance the competitiveness of
exported goods of beneficiary countries
in the international market.
- Promote exports, diversify markets,
Benefit and attract foreign investment.
Procedures for applying for a
Defect GSP/GSTP C/O can be complicated and
time-consuming.
For example United States, European Union, Japan
A fundamental principle in
international commercial law that each
country must accord to all other
countries tariffs and terms of trade no
less favorable than it accords to any
other country. any other family.
- Preferential: The most basic tariffs
and terms of trade that a country
offers to any other country.
- Conditions: No specific conditions
are required.
- Process: Apply automatically, no
certification procedures required.
No need to apply for C/O.
- Ensure transparency, fairness and
non-discrimination in international
trade.
- Promote trade liberalization and
international economic integration.
Tax rates may be higher than
GSP/GSTP taxes
World Trade Organization (WTO)