In a world where it is becoming more globalized due to technology, communication, demand for products have never been so important. While certain nations have implemented this policy which allowed them to develop quicker sadly other nations have been left behind.
To ensure that people across the world have access to the global market, there are certain facilities agreed upon by nations and world trade organizations. A very helpful facility that exporters from ‘developing countries’ have is what is knows as ‘Generalized Scheme of Preference (GSP)’.
GSP allows duty free access from ‘developing countries’ to ‘developed nations’, it means exporters can have access to such regions where there are no tariffs. This is immensely beneficial for developing countries to access advanced economies thereby improving their own economy.
Developed nations have made their own criteria to allow such preference which matches with their intended outcome. Each nation has certain policies to allow all kinds of products except certain items which are not. There are different categories of ‘GSP’ which allows partial tariff, special incentives, and full access to the country’s economy.
However, to fully benefit the people it has added conditions such as the product from the developing country must be ‘wholly obtained’ or at least ‘substantially transformed’ from the destination of origin. This allows local people to get involved in the development of the product while benefiting from the global market.