EU Discontinues GSP Privileges for Six Categories of Chinese Exports

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Last updated at: (Beijing Time) Saturday, July 05, 2003

EU Discontinues GSP Privileges for Six Categories of Chinese Exports

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The European Union's discontinuation of Generalized System of Preferences (GSP) privileges for six categories of Chinese exports will weaken the products' competitive edge, though they only have a minor role in China-EU trade, local experts said.

The GSP status previously granted to the six "graduated" Chinese products will be reduced from November of 2003 and eventually eliminated by May, 2004, Franz Jessen, deputy head of the Delegation of the European Commission to China, said here Friday.

The sectors concerned include food products of animal origin such as eggs, plastics and rubber, paper, electro-mechanics, consumer electronics, optical and clocks, Jessen said.

"But compared with the over 40 percent growth of EU-China tradein 2002 and the over 8 billion US dollars in bilateral trade volume, the impact of the measure is minimal," Jessen said.

Another eighteen export sectors of China will remain on the GSPlist, said Jessen.

Zhou Wenming, a researcher with the Chinese Academy of International Trade and Economic Cooperation, said that the cancellation of GSP privileges will have a negative impact on Chinese exports to some extent, but it will not be a crucial factor in China-EU trade.

He suggested Chinese enterprises enhance innovation to sharpen products' competitive edge in the EU market and to minimize the impact of the discontinuation of the GSP.

Zhou said, the EU technical criteria, which include environmentally-friendly requirements, might emerge as a major obstacle for Chinese products to enter EU market.

China-EU trade volume hit 45.7 billion US dollars in the first five months of 2003, surging 43.9 percent year-on-year, statisticsfrom the Chinese Customs show.

From January to May of this year, China exported 25.7 billion US dollars worth of products to the European Union, while importing nearly 20 billion US dollars worth of goods from the EU.

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