The EU’s trade relations with developing countries continue to drive sustainable economic growth

On 16 July, the European Commission and the High Representative for Foreign Affairs and Security Policy published anew joint report on the implementation of the Generalised System of Preferences (GSP), the EU’s main trade policy instrument for supporting exports from developing countries to the bloc. The report confirms that the scheme continues to contribute to economic progress and sustainable development in beneficiary countries. The GSP, which unilaterally offers access to EU markets with low or zero tariffs, remains a source of stability and predictability in times of geopolitical volatility.

The report covers the implementation and impact of the GSP during the period 2023–2025 across its three schemes (Standard GSP, GSP Plus and Everything But Arms). In 2024, the EU imported goods worth close to €60,000 million under GSP preferences, benefiting both partner countries and EU importers and consumers. GSP beneficiary countries received preferential tariff treatment, resulting in estimated savings of 5,000 million euros. The largest category of beneficiaries continued to be the least developed countries, which received over €3 billion of the total under the Everything But Arms scheme. Overall, Bangladesh, India and Pakistan were the main beneficiaries of the scheme, and clothing was the most significant sector, accounting for 59 per cent of all trade that utilised GSP preferences.

The GSP supports sustainability and good governance.

Beyond its trade and economic benefits, the GSP remains an attractive and effective incentive for sustainable development in beneficiary countries in the areas of human rights, labour rights, the environment and climate issues, the rule of law, drug control and the fight against corruption. The EU’s monitoring and engagement within the GSP framework play a key role in supporting progress in these areas. Furthermore, EU partnership projects can help address some of these challenges through cooperation and country-specific measures.

The report is accompanied by nine staff working documents (SWDs), one for each of the eight current GSP beneficiaries (Bolivia, Cape Verde, Kyrgyzstan, Mongolia, Pakistan, the Philippines, Sri Lanka and Uzbekistan) and one for the three EBA countries participating in an enhanced partnership programme (Bangladesh, Cambodia and Myanmar).

Overall, GSP beneficiaries continue to make progress towards sustainable development and compliance with the international principles and standards that form part of the GSP’s conditionality. Many current GSP beneficiaries strengthened their human rights legislationand institutional arrangements, and most of them demonstrated progress on labour rights during the reporting period. Many GSP beneficiaries also maintained their commitment to climate and environmental protection, strengthening legislation on biodiversity and protected areas. Good governance in the areas of drug control and the fight against corruption improved in several countries.

However, challenges remain regarding the implementation of GSP commitments. These relate, in particular, to human rights, including insufficient judicial independence and limited access to redress and accountability for violations and abuses. Furthermore, with regard to labour rights, implementation and enforcement remain uneven, and labour inspections often face capacity constraints.

Looking ahead, the economic outlook for most GSP beneficiary countries is expected to continue improving, and several of them are on track to graduate from the UN list of least developed countries. Nevertheless, the GSP will remain important, as it will support beneficiary countries during periods of transition.

Background

The GSP is the EU’s main unilateral trade policy for supporting low- and lower-middle-income countries in poverty reduction, economic growth and sustainable development. It reduces or eliminates import duties on goods imported into the EU, benefiting 65 countries, representing more than 3 billion people worldwide. Least developed countries (LDCs) benefit from duty-free and quota-free access. This preferential access to the EU market is conditional upon compliance with international standards on human rights, labour rights, the environment and climate, and good governance in relation to drug control and the fight against corruption.

The report reflects the collaboration between the Commission and the European External Action Service (EEAS) with the authorities of the beneficiary countries, civil society, social partners and business communities, including through monitoring missions to GSP beneficiaries, as well as enhanced collaboration with certain key beneficiaries of the EBA programme.

This is the final report drawn up under the current GSP Regulation. It marks the transition tothe new GSP Regulation,which incorporates strengthened sustainability and transparency requirements. Regular monitoring and reporting remain central to the implementation of the GSP, as confirmed in the new Regulation. Thenew EU GSP Regulation for the period 2027–2036was adopted on 17 June 2026 and published in the Official Journal on 22 June 2026. It will enter into force on 1 January 2027.

 

More information: European Commission