# 1_EN_ACT_part1_v4.docx

european flagEUROPEAN COMMISSION

Brussels, 19.1.2018

COM(2018) 36 final

REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL

Report on the Generalised Scheme of Preferences covering the period 2016-2017

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1.Introduction

This report and its accompanying staff working document
  1
  assesses the effects of the Generalised Scheme of Preferences ('GSP') during the years 2016-2017, with a focus on the performance of GSP+ beneficiaries. Under the GSP Regulation
  2
  this report shall be submitted biennially to the European Parliament and the Council.

Through GSP, the EU continues to be at the vanguard of accompanying developing countries to achieve sustainable development using the economic engines of trade. Trade preferences as enablers to promote universal values of human rights, social justice and environmental protection are an integral part of the Commission's Trade for All
  3
   strategy. Generous access to the EU market enables GSP beneficiaries to generate additional revenues via international trade and contributes to their efforts to reduce poverty and promote sustainable development, human rights and good governance.

1.1.Three arrangements within GSP

The GSP has three different trade preference arrangements, which were set out in detail in the 2016 GSP report
  4
  and are summarised below:

−The general arrangement ('Standard GSP') grants duty reductions for around 66% of all EU tariff lines to low-income or lower-middle income countries
  5
  , which do not benefit from other preferential trade access to the EU market. During the 2016-2017 reporting period there were 23 Standard GSP beneficiaries (see

  Table 1

  ).

−The special incentive arrangement for Sustainable Development and Good Governance ('GSP+') grants full duty suspension for essentially the same 66% of tariff lines as Standard GSP to eligible countries vulnerable in terms of economic diversification and export volumes. In return, beneficiary countries must ratify and effectively implement 27 core international conventions, as listed in the GSP Regulation, which cover human and labour rights, environmental protection and good governance. During the 2016-2017 reporting period, there were 10 GSP+ beneficiaries (see Table 2).

−The special arrangement Everything But Arms ('EBA') grants full duty-free, quota-free access for all products except arms and ammunition to countries classified by the UN as Least Developed Countries ('LDCs'). Other than for Standard GSP and GSP+, countries do not lose EBA status by entering into a Free Trade Agreement (FTA) with the EU. During the 2016-2017 reporting period, there were 49 EBA beneficiaries (see

  Table 3

  ).

In 2016, EUR 62.6 billion of imports entered the EU under GSP preferences, divided as follows: EUR 31.6 billion from Standard GSP countries, around EUR 7.5 billion from GSP+ beneficiaries and EUR 23.5 billion from EBA countries (details are given in Tables 4 - 7)
  6
  .

Figures 1 and 2 below provide an overview of imports under the three GSP arrangements.

As shown in Figure 3, the two countries that took up the largest part of all EU imports from GSP beneficiaries (including non-GSP imports) are India and Vietnam – both Standard GSP beneficiaries. The third largest is Bangladesh, an EBA beneficiary.

Figure 4 shows that India, Bangladesh and Vietnam are also the three largest beneficiaries on the basis of GSP preferential imports only.

2.the Standard GSP arrangement

| India


  From 2014 onwards, several product sections, including textiles, were graduated from GSP as they no longer qualified for GSP trade preferences. Despite graduation, India remains the biggest exporter to the EU under the GSP. In 2016, India exported EUR 7.6 billion worth of textiles and clothing to the EU, of which EUR 5.7 billion under Standard GSP. |
| --- |

India

From 2014 onwards, several product sections, including textiles, were graduated from GSP as they no longer qualified for GSP trade preferences. Despite graduation, India remains the biggest exporter to the EU under the GSP. In 2016, India exported EUR 7.6 billion worth of textiles and clothing to the EU, of which EUR 5.7 billion under Standard GSP.

During the 2016-2017 reporting period, 23 countries benefited from Standard GSP (Table 1). In this period, five countries left the Standard GSP due to changes to their access to the EU market (covered by an FTA) or to their economic status (classification by the World Bank as upper-middle income country or above for three consecutive years). Figure 5 below shows the breakdown of preferential imports
  7
  to the EU under the Standard GSP scheme in 2016.

| Vietnam


  In 2016, Vietnam accounted for 23% of total imports from all standard GSP beneficiaries together. Looking only at the GSP imports from Vietnam, footwear accounted for nearly 40%. |
| --- |

Vietnam

In 2016, Vietnam accounted for 23% of total imports from all standard GSP beneficiaries together. Looking only at the GSP imports from Vietnam, footwear accounted for nearly 40%.

The list of product sections originating in Standard GSP beneficiary countries is reviewed every three years. The last review took place in 2016, leading to a revised list of product sections that entered into force on 1 January 2017
  8
  . Products that no longer required the support of GSP preferences were removed from the product list.

3.The EBA arrangement

EBA is the EU's flagship trade instrument designed to help the world's poorest and weakest countries, the LDCs, take advantage of trading opportunities. During the 2016-2017 reporting period there were 49 EBA beneficiaries (see Table 3).

Figure 6 provides a breakdown of the value and percentage of preferential imports from EBA beneficiaries during 2016. The largest share of EBA imports came from Bangladesh (66%), followed by Cambodia (18%).

3.1.Enhanced engagement with certain EBA beneficiaries

| Myanmar


  Myanmar was reinstated as an EBA beneficiary in 2013, as a recognition of its efforts to launch ambitious political, social and labour reforms. The recent humanitarian and human rights situation in Rakhine State is extremely serious.  The EU has urged the Myanmar Government to grant full humanitarian access and enable the safe, voluntary and dignified return of all refugees. The EU called on Myanmar to find a long-term solution to the structural issues in Rakhine State, in line with its international commitments and respect of EBA requirements. |
| --- |

Myanmar

Myanmar was reinstated as an EBA beneficiary in 2013, as a recognition of its efforts to launch ambitious political, social and labour reforms. The recent humanitarian and human rights situation in Rakhine State is extremely serious.  The EU has urged the Myanmar Government to grant full humanitarian access and enable the safe, voluntary and dignified return of all refugees. The EU called on Myanmar to find a long-term solution to the structural issues in Rakhine State, in line with its international commitments and respect of EBA requirements.

As stated in the Commission's Trade for All strategy, the EU can temporarily withdraw Standard GSP or EBA preferences in exceptional circumstances, notably in cases of serious and systematic violation of principles laid down in the human rights and labour rights conventions listed in the GSP Regulation.

Through enhanced engagement, the EU intensified the dialogue with some EBA countries to press for concrete actions on and sustainable solutions to serious shortcomings in respecting fundamental human and labour rights. If the dialogue fails to produce results, the EU remains ready, as a last resort, to launch the GSP withdrawal procedure with due consideration for the economic and social impact of such a withdrawal.

Bangladesh

| Bangladesh


  EBA has contributed to its socio-economic development by generating millions of employment opportunities in the ready-made garment industry where the large majority of workers are women. This must, however, go hand-in-hand with the respect of fundamental human and labour rights, in particular freedom of association, in order to contribute to increased prosperity and decent work. The EU needs to see real and sustained improvements if further steps are to be avoided. |
| --- |

EBA has contributed to its socio-economic development by generating millions of employment opportunities in the ready-made garment industry where the large majority of workers are women. This must, however, go hand-in-hand with the respect of fundamental human and labour rights, in particular freedom of association, in order to contribute to increased prosperity and decent work. The EU needs to see real and sustained improvements if further steps are to be avoided.

Regarding Myanmar, the EU is, together with the United States, Japan, Denmark and the ILO, part of the "Initiative to Improve Labour Rights and Practices in Myanmar" designed to promote the compliance with ILO international labour standards and responsible business practices. This international stakeholder forum helps to raise as a priority the labour law reform process in Myanmar and to foster relationships between the social partners.

Following declining human and labour rights situations in Bangladesh and Cambodia, the Commission and EEAS have engaged more actively with these two countries and involving relevant stakeholders, including NGOs, CSOs, international organisations, social partners, and businesses.

| Cambodia


  The EU is engaging with Cambodia to address human rights issues related to land disputes arising from sugarcane concessions and labour rights issues, in particular freedom of association. The EU needs to see real and sustained improvements, if further steps are to be avoided. |
| --- |

Cambodia

The EU is engaging with Cambodia to address human rights issues related to land disputes arising from sugarcane concessions and labour rights issues, in particular freedom of association. The EU needs to see real and sustained improvements, if further steps are to be avoided.

In Bangladesh, the Commission has raised concerns regarding labour rights, in particular freedom of association and the implementation of the joint initiative known as the "Compact for Continuous Improvements in Labour Rights and Factory Safety in the Ready-Made Garment and Knitwear Industry in Bangladesh". The EU has in particular raised the alignment of the Bangladesh Labour Act (BLA) and the Export Processing Zone (EPZ) Act with the ILO labour rights conventions as one of the priority actions.

With Cambodia, the EU has urged the Government to establish an independent and transparent mechanism in order to deal with claims for compensation arising from the granting of Economic Land Concessions (ELCs) to sugar cane plantations.

Enhanced engagement is primarily based on the available recommendations and conclusions of the ILO and other UN bodies monitoring the human rights and labour rights conventions. The use of these recommendations and conclusions allows for an objective and transparent way of assessing the implementation of the international commitments undertaken.

The process has helped to build pressure on governments in order to address issues of concern, and is seeing some positive developments. In parallel, the issues were raised in a coherent and coordinated manner through all relevant channels (such as trade committees, political or human rights dialogues).

Progress is encouraging. Nonetheless, the EU is ready to launch the GSP withdrawal procedure, as a last resort, in case our constructive efforts through the dialogues fail to produce satisfactory results. Such a decision will give due consideration to the negative economic, social and human consequences related to the potential withdrawal of GSP preferences.

4.The GSP+ arrangement

GSP+ is one of the EU's primary tools to promote sustainable development in vulnerable developing countries. GSP+ countries benefit from easier trade with the EU, with the condition that they effectively implement the 27 core international conventions on human and labour rights, environmental protection and good governance.

4.1.GSP+ beneficiaries

The 2016-2017 reporting period covers 10 GSP+ beneficiaries: Armenia, Bolivia, Cabo Verde, Georgia, Kyrgyzstan, Mongolia, Pakistan, Paraguay, the Philippines and Sri Lanka (see Table 2).

Georgia ceased to benefit from GSP+ on 1 January 2017, as it obtained preferential market access under a Deep and Comprehensive Free Trade Agreement (DCFTA) with the EU. Kyrgyzstan became a GSP+ beneficiary shortly after the start of the reporting period (January 2016). Sri Lanka re-entered GSP+ in May 2017, after having been removed in 2010. Classified for three consecutive years by the World Bank as an upper middle income country, Paraguay will leave GSP+ on 1 January 2019.

Figure 7 below presents the value of preferential imports
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   from GSP+ countries in 2016. The largest share came from Pakistan, which accounted for 74% of all GSP+ imports.

4.2.GSP+ monitoring

| Bolivia


  Bolivia continued to make substantial progress in effectively implementing human rights commitments in 2016-2017, notwithstanding the overall socioeconomic situation. In particular, Bolivia has made efforts to eradicate poverty, improve access to education, health, food and housing and address reproductive health issues. However, a major concern remains the minimum age for admission to work, which is not compatible with ILO Convention 138. |
| --- |

Bolivia

Bolivia continued to make substantial progress in effectively implementing human rights commitments in 2016-2017, notwithstanding the overall socioeconomic situation. In particular, Bolivia has made efforts to eradicate poverty, improve access to education, health, food and housing and address reproductive health issues. However, a major concern remains the minimum age for admission to work, which is not compatible with ILO Convention 138.

GSP+ is based on the concept of sustainable development. When joining the GSP+, beneficiaries commit to effectively implement the 27 core conventions in return for better access to the EU market.

GSP+ beneficiaries are expected to show ownership and political commitment and – most importantly – to continuously improve their compliance over time, despite the shortcomings identified.

| Pakistan


  There have been positive developments in strengthening the human rights framework and legislative actions on the rights of women, children, minorities and labour rights, with legislation on, inter alia, torture, juvenile justice and transgender rights in the pipeline. However, these areas, as well as the use of torture, application of the death penalty, high prevalence of child labour and freedom of expression pose serious concerns. The overall human rights situation is therefore mixed and Pakistan must step-up its efforts to ensure enforcement and implementation of legislation. |
| --- |

Pakistan

There have been positive developments in strengthening the human rights framework and legislative actions on the rights of women, children, minorities and labour rights, with legislation on, inter alia, torture, juvenile justice and transgender rights in the pipeline. However, these areas, as well as the use of torture, application of the death penalty, high prevalence of child labour and freedom of expression pose serious concerns. The overall human rights situation is therefore mixed and Pakistan must step-up its efforts to ensure enforcement and implementation of legislation.

In GSP+ monitoring, the EU engages with the beneficiary country on all areas where implementation is unsatisfactory.

4.2.1.Engagement with stakeholders

| Sri Lanka


  Sri Lanka has taken important steps to improve governance and respect for human rights. Sri Lanka is engaging well with the UN system. However, the Government has not yet delivered on a number of important reforms that are of direct relevance for the effective implementation of the human rights conventions under GSP+, in particular the repeal of the Prevention of Terrorism Act, ensuring fundamental legal safeguards and addressing the use of torture. |
| --- |

Sri Lanka

Sri Lanka has taken important steps to improve governance and respect for human rights. Sri Lanka is engaging well with the UN system. However, the Government has not yet delivered on a number of important reforms that are of direct relevance for the effective implementation of the human rights conventions under GSP+, in particular the repeal of the Prevention of Terrorism Act, ensuring fundamental legal safeguards and addressing the use of torture.

The burden of proof for compliance with the GSP+ binding undertakings rests with the beneficiary country
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  . Beneficiary countries should provide all information necessary to allow the EU to assess their GSP+ compliance. The EU assessment relies primarily on the most recent reports and recommendations from international monitoring bodies, such as the ILO and the UN. The EU actively engages with these international organisations, in particular as UN reports are issued every 4-5 years, which is a longer interval than the two-year GSP+ reporting cycle. Meetings with UN and ILO monitoring bodies, and their local representatives, take place prior to and during EU GSP+ monitoring missions.

The EU also makes use of a wide range of other information and meets with civil society organisations (CSOs), including trade unions, human rights defenders, businesses and employers before and during monitoring missions, both in the EU and in the beneficiary country. A Civil Society Dialogue was held in June 2017 to consult CSOs and gather their input and views
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  .

The European Parliament (EP) and the Council are actively involved in the implementation of GSP+ and the monitoring of beneficiaries' compliance. Regular meetings with Member States are organised in the format of the GSP Expert Group and the Council GSP Working Party. Issues discussed with Member States' experts included the scorecards replies received from GSP+ beneficiaries and debriefings on GSP+ monitoring missions.

| Mongolia


  GSP+ dialogue and support provided through an EU-funded ILO project encouraged Mongolia to revise its Labour Law. Mongolia approved a National Program on Gender Equality to develop gender-sensitive policies by 2021. The newly adopted Criminal Code provides a definition of 'torture' in line with the Convention against Torture. The possible re-introduction of the death penalty and the prevalence of corruption, having a pervasive impact on the human rights situation, are serious concerns. |
| --- |

Mongolia

GSP+ dialogue and support provided through an EU-funded ILO project encouraged Mongolia to revise its Labour Law. Mongolia approved a National Program on Gender Equality to develop gender-sensitive policies by 2021. The newly adopted Criminal Code provides a definition of 'torture' in line with the Convention against Torture. The possible re-introduction of the death penalty and the prevalence of corruption, having a pervasive impact on the human rights situation, are serious concerns.

During the 2016-2017 period, the EP's Committee on International Trade (INTA) organised several exchanges of views on GSP, including on progress by GSP+ beneficiaries, monitoring visits, and the role of CSOs in GSP+ applications. The Commission and the EEAS also benefited from the involvement of EP delegations' missions to specific GSP+ countries.

4.2.2.The GSP+ monitoring missions

| Philippines


  Progress has been noted in areas such as gender equality, trafficking in persons, labour rights, health, education, social-economic rights, fight against corruption and protection of the environment. President Duterte signed the EU-Philippines Partnership and Cooperation Agreement, now with the Senate for approval. However, extrajudicial killings, in particular in the fights against illegal drugs, and related impunity continue to be a serious concern, as well as the possible reintroduction of the death penalty and the lowering of the age of criminal responsibility. |
| --- |

Philippines

Progress has been noted in areas such as gender equality, trafficking in persons, labour rights, health, education, social-economic rights, fight against corruption and protection of the environment. President Duterte signed the EU-Philippines Partnership and Cooperation Agreement, now with the Senate for approval. However, extrajudicial killings, in particular in the fights against illegal drugs, and related impunity continue to be a serious concern, as well as the possible reintroduction of the death penalty and the lowering of the age of criminal responsibility.

GSP+ monitoring uses two inter-related tools. The first is the 'scorecard', which is a list of the most salient shortcomings identified by the respective international monitoring bodies (or any other accurate and reliable source) for each convention. All GSP+ beneficiaries receive such a scorecard annually and are asked to respond to the shortcomings listed.

The second tool is the 'GSP+ dialogue' including the GSP+ monitoring missions, through which the EU engages with authorities in a frank and open discussion on identified shortcomings and remedial actions. During the 2016-2017 reporting period, the Commission and the EEAS performed monitoring missions in Armenia, Bolivia, Cabo Verde, Kyrgyzstan, Mongolia, Pakistan, Paraguay, the Philippines and Sri Lanka.

The GSP+ monitoring missions allowed for direct and high-level contacts with governments, ministries and agencies, as well as businesses, local NGOs and CSOs. Coordination meetings were held with international UN and ILO organisations present in the countries, such as the Office of the UN High Commissioner for Human Rights, the UN Development Programme (UNDP), and the UN Office on Drugs and Crime (UNODC). This improved the overall understanding amongst stakeholders of the GSP+ system and of each GSP+ beneficiary's specific commitment, also facilitating the collection of on-the-ground input from key stakeholders.

Local stakeholders play an important role in pushing regional and central authorities to meet their GSP+ commitments. In particular, as direct beneficiaries of tariff preferences, businesses are expected to support the authorities in implementing the relevant 27 conventions.

GSP+ mission to Kyrgyzstan (June 2016)

As Kyrgyzstan had joined GSP+ only in January 2016, the mission was devoted to introducing GSP+ and preliminary monitoring. The back-to-back GSP+ monitoring meetings with the Human Rights Dialogue proved to be very effective, as the latter also addressed GSP+ relevant issues such as prevention of torture and mistreatment in detention facilities and work to improve inter-ethnic relations, counter discrimination, diminish the practice of bride-kidnapping and improve children rights. Businesses were keen on learning about the economic advantages of GSP+.

GSP+ Mission to Bolivia (June 2016)

Child labour was discussed as a matter of high priority, with a particular focus on the lowering of the working age for children. With the largest proportion of indigenous people in South America (about 66% of the total population), the right of indigenous peoples to prior consultation and informed consent on land access was highlighted as well.

GSP+ Mission to Cabo Verde (July 2017)

Cabo Verde’s overall human rights record continues to be positive. Persistent issues include gender-based violence, rights of the child and delays in reporting. As for the latter issue, Cabo Verde is making notable efforts to address this in close collaboration with the ILO in an EU-funded capacity-building project.

GSP+ Mission to Paraguay (June 2016)

Positive initiatives on human rights include the establishment of the Monitoring System on International Recommendations on Human Rights (SIMORE) with OHCHR support. Child labour, notably linked to the practice of "criadazgo" (domestic work) was discussed during the mission as one of the key concerns.

GSP+ Mission to Pakistan (November 2016)

The second GSP+ mission noted positive institutional (e.g. establishment of the National Commission on Human Rights and a National Action Plan for Human Rights) and legislative (e.g. adoption of anti-rape and anti-honour killing laws) developments. At the same time, serious challenges remain, including on the rights of women, children and minorities, freedom of expression, the application of the death penalty, torture, and the capacity to implement and enforce legislation.

GSP+ Mission to the Philippines (Jan – Feb 2017)

Positive developments in areas such as gender equality, human trafficking, labour rights, reproductive health and protection of the environment were noted. Progress on key issues is dependent on legislation still pending in Congress. Serious concerns remain on the way the campaign against illegal drugs is conducted, in particular concerning the right to life, legal safeguards, effective investigation and prosecution, on the cooperation with UN mechanisms as well as on the possible re-introduction of the death penalty and the possible lowering of the age of criminal responsibility.

GSP+ Mission to Mongolia (March 2017)

The first GSP+ monitoring visit noted positive legislative developments, such as the entry into force of the new Criminal Code, the revised Law on Domestic Violence, and the Law on Child Protection and the Law on the Rights of Children. Mongolia made good progress on ILO reporting with the help of an EU-funded project. Mongolia also aims to improve its capacity to reap the full trade benefits of GSP+.

GSP+ Mission to Armenia (June 2017)

The most salient issues to be tackled by Armenia were thoroughly discussed, including the effective implementation of the 2014-2016 and 2017-2019 human rights action plans, the submission to the Parliament of the new Judicial Code, Criminal Code and Criminal Procedural Code, a standalone law against domestic violence and a comprehensive anti-discrimination law in line with international standards, the need to (re)establish a labour inspection system and to make progress towards Category 1 status under the CITES Convention.

GSP+ Mission to Sri Lanka (September 2017)

The first monitoring mission after Sri Lanka was granted GSP+ in May 2017, which also included a visit to Jaffna, noted that overall Sri Lanka is making progress in implementing the 27 conventions. However, more efforts are needed to repeal the Prevention of Terrorism Act, address the prevalent use of torture, account for enforced disappearances, return land in former conflict areas and combat trade union discrimination and unfair labour practices.

4.3.Technical assistance and development projects

During the reporting period, the Commission and the ILO carried out specific GSP+ projects
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  to support compliance with ILO reporting and implementation requirements in the following GSP+ countries: Armenia, Cabo Verde, Mongolia, Pakistan, Paraguay and the Philippines. These projects will continue during the next two years.

In Armenia, Paraguay and the Philippines, the focus was on strengthening the public administrations' capacity to effectively apply the fundamental ILO conventions. In Cabo Verde, the ILO supported the local administration to submit the overdue ILO reports. In Pakistan, the main objective was to support the drafting of legislation and related implementation initiatives on the elimination of child labour and forced labour. In Mongolia, in addition to capacity building for timely reporting, the ILO assisted in the alignment of legislation with the ILO Convention on the Right to Organise and to Bargain Collectively.

Highlights of EU-ILO projects in GSP+ countries

Cabo Verde

In Cabo Verde, the EU's GSP+ action has improved awareness of the fundamental ILO Conventions amongst the tripartite constituents (government, employers, and workers). It has also promoted tripartite discussions on legislation in light of comments made by the ILO supervisory bodies. In addition, Cabo Verde is now up-to-date with its reports on Conventions 87 and 98 concerning freedom of association and the right to organise and to bargain collectively. Social partners have become more aware of their role and better equipped to address the comments of the ILO supervisory bodies.

Mongolia

The EU-ILO project helped Mongolia improve International Labour Standards (ILS) compliance and reporting. The project reviewed the Mongolian translation of the fundamental ILO Conventions and helped Mongolia better understand its commitments. The project also resulted in tripartite consultations on the revision of the Labour Law, which is now better aligned with fundamental principles and rights at work. Through a policy brief on ILS and trade in English and Mongolian, as well as high-level dialogues and workshops, the Government, workers’ and employers’ organisations improved their understanding of fundamental principles and rights at work. Thanks to the technical assistance, Mongolia is now up-to-date with its ILS reporting.

Pakistan

The EU-funded capacity building initiative has enabled federal and provincial labour departments to improve their reporting on the ratified ILO Conventions. The ILO workshops held in January, February and April 2017 contributed to strengthening the social dialogue in the Federal and Provincial Tripartite Consultative Committees. At the workshops, labour departments met with employers' and workers' organisations to improve their understanding of core labour standards.

As part of the EU GSP+ action and in response to newly delegated legislative responsibilities, the ILO also offered specific technical support to the Government of Balochistan in the drafting of a set of revised labour laws. Consultations took place with the social partners to ensure that the laws are better aligned with ILO principles.

Philippines

The EU GSP+ action in the Philippines focused on creating an environment conducive to freedom of association and collective bargaining, following the recommendations of an ILO Direct Contacts Mission in February 2017. The EU GSP+ action enabled discussions between the labour department and the social partners, which have resulted in a tripartite manifesto committing to the effective implementation of the principles of freedom of association and collective bargaining and to creating a national action plan to this effect.

Furthermore, in 2017, projects aimed at supporting local CSOs
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  and social partners participation in GSP+ were launched in all GSP+ countries. In the course of 2017, the project teams conducted fact-finding missions to identify the key issues for their projects, which will be carried out with local CSOs. Over the next reporting period, the Commission will continue to consider ways of supporting beneficiaries through expertise, technical assistance and specific projects on capacity-building.

Furthermore, in 2017, projects aimed at supporting local CSOs

13

and social partners participation in GSP+ were launched

in all GSP+ countries. In the course of 2017, the project teams conducted fact-finding missions to identify the key issues for their projects, which will be carried out with local CSOs. Over the next reporting period, the Commission will continue to consi

der ways of supporting beneficiaries through expertise, technical assistance and specific projects on capacity-building.

4.4.Accompanying this Report: Staff Working Document on GSP+

4.4.

Accompanying this Report: Staff Working Document on GSP+

As the 2016 GSP report, this second biennial report on GSP is accompanied by a Staff Working Document (SWD) on GSP+. The SWD provides a comprehensive assessment of individual GSP+ beneficiaries' compliance with their GSP+ obligations per cluster: human rights, labour rights, environment and good governance. It assesses progress, shortcomings, future actions and priorities towards achieving effective implementation of the 27 core conventions.

As the 2016 GSP report, this second biennial report on GSP is accompanied by a Staff Working Document (SWD) on GSP+. The SWD provides a comprehensive assessment of individual GSP+ beneficiaries' compliance with their GSP+ obligations per cluster: human rights, labour rights, environment and good governance. It assesses progress, shortcomings, future actions and priorities towards achieving effective implementation of the 27 core conventions.

4.5.Mid-Term Evaluation Report

4.5.

Mid-Term Evaluation Report

In accordance with the GSP Regulation
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  , the Commission is to submit a Mid-Term Evaluation Report on the application of the GSP Regulation to the European Parliament and to the Council five years after the entry into force of the GSP Regulation. This Mid-Term Evaluation Report will assess whether the GSP Regulation reaches its objectives. Its conclusions will be taken into account for the design of the next GSP. The report is expected to be adopted during the first semester of 2018.

In accordance with the GSP Regulation

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, the Commission is to submit a Mid-Term Evaluation Report on the application of the GSP Regulation to the European Parliament and to the Council five years after the entry into force of the GSP Regulation. This Mid-Term Evaluation Report will assess wheth

er the GSP Regulation reaches its objectives. Its conclusions will be taken into account for the design of the next GSP. The report is expected to be adopted during the first semester of 2018.

5.Conclusions

5.

Conclusions

The biennial report on GSP tracks the implementation of the current GSP scheme since its tariff preferences started to apply in January 2014. The accompanying SWD sets out the human rights, social and environmental situation in the GSP+ beneficiary countries and provides a platform for civil society engagement with beneficiary countries' governments.

The biennial report on GSP tracks the implementation of the current GSP scheme since its tariff preferences started to apply in January 2014. The accompanying SWD sets out the human rights, social and environmental situation in the GSP+ beneficiary countries and provides a platform for civil society engagement with beneficiary countries' governments.

During the present monitoring cycle, GSP+ beneficiaries were urged to increasingly take ownership of the implementation of the 27 conventions and to be more proactive in addressing the issues listed in the scorecards and raised during the GSP+ monitoring missions.

During the present monitoring cycle, GSP+ beneficiaries were urged to increasingly take ownership of the implementation of the 27 conventions and to be more proactive in addressing the issues listed in the scorecards and raised during the GSP+ monitoring missions.

Kyrgyzstan, which joined GSP+ in January 2016, features for the first time in this report. Sri Lanka re-joined GSP+ in May 2017, the monitoring period therefore covers less than 6 months. In Armenia, the monitoring mission proved to be a valuable way to involve local civil society. In the absence of recent reports to the UN and ILO, the monitoring mission to Cabo Verde was crucial to collect the information needed for EU's assessment. The monitoring mission to the Philippines was an opportunity for the EU to express its concerns on recent human rights developments, while also recognising progress on labour rights and socio-economic policies. In Paraguay and Bolivia, the issue of child labour was openly discussed with the participation of all relevant stakeholders, including the ILO and UNICEF. Georgia features for the last time as it has phased out of the GSP+ due to its DCFTA with the EU.

Kyrgyzstan, which joined GSP+ in January 2016, features for the first time in this report. Sri Lanka re-joined GSP+ in May 2017, the monitoring period therefore covers less than 6 months. In Armenia, the monitoring mission proved to be a valuable way to involve local civil society. In the absence of recent reports to the UN and ILO, the monitoring mission to Cabo Verde was crucial to collect the information needed for EU's assessment. The monitoring mission to the Philippines was an opportunity for the EU to express its concerns on recent human rights developments, while also recognising progress on labour rights and socio-economic policies. In Paraguay and Bolivia, the issue of child labour was openly discussed with the participation of all relevant stakeholders, including the ILO and UNICEF. Georgia features for the last time as it has phased out of the GSP+ due to its DCFTA with the EU.

Overall, the GSP+ monitoring provided a structured approach and a solid basis for the assessment of each GSP+ beneficiary, building on the findings of UN and ILO monitoring bodies and on information provided by third parties, including civil society, social partners, the European Parliament and the Council. GSP+ monitoring is fully integrated into the EU's bilateral framework and dialogues, including the Human Rights Dialogues. In particular, GSP+ has supported countries like Pakistan, Sri Lanka, Mongolia and Bolivia to intensify their engagement in the EU Human Rights Dialogues. At the same time, the Human Rights Dialogues provided a platform to discuss GSP+ related human rights issues. GSP+ has improved synergies and led to a mutually re-enforcing leverage of the two tools.

Overall, the GSP+ monitoring provided a structured approach and a solid basis for the assessment of each GSP+ beneficiary, building on the findings of UN and ILO monitoring bodies and on information provided by third parties, including civil society, social partners, the European Parliament and the Council. GSP+ monitoring is fully integrated into the EU's bilateral framework and dialogues, including the Human Rights Dialogues. In particular, GSP+ has supported countries like Pakistan, Sri Lanka, Mongolia and Bolivia to intensify their engagement in the EU Human Rights Dialogues. At the same time, the Human Rights Dialogues provided a platform to discuss GSP+ related human rights issues. GSP+ has improved synergies and led to a mutually re-enforcing leverage of the two tools.

Whilst GSP is an important enabling tool to address human rights and labour concerns in beneficiary countries, the EU is committed to use all relevant policies and instruments to support them in achieving their sustainable development and good governance goals. Given the nature of such issues and the need for structural and lasting solutions, GSP engagement requires a steady long-term commitment by both the EU and beneficiary countries.

Whilst GSP is an important enabling tool to address human rights and labour concerns in beneficiary countries, the EU is committed to use all relevant policies and instruments to support them in achieving their sustainable development and good governance goals. Given the nature of such issues and the need for structural and lasting solutions, GSP engagement requires a steady long-term commitment by both the EU and beneficiary countries.

The next reporting period covering 2018 and 2019 will be launched with a new biennial cycle of scorecards and monitoring missions in the first half of 2018. By the end of 2019, the Commission will submit its third biennial report on GSP to the European Parliament and the Council, with a particular focus on evaluating trends in all GSP+ beneficiaries.

6.Beneficiaries of the Standard GSP scheme and EBA scheme

Table 1 – Standard GSP Beneficiaries 2016-2017

| | Standard GSP beneficiaries during the 2016 -2017 reporting period | Changes in beneficiary status during 2016-2017 |
| --- | --- | --- |
| 1. | Cameroon | Left the scheme on 1 January 2017 |
| 2. | Cook Islands | |
| 3. | Cote d'Ivoire | |
| 4. | Fiji | Left the scheme on 1 January 2017 |
| 5. | Ghana | |
| 6. | India | |
| 7. | Indonesia | |
| 8. | Iraq | Left the scheme on 1 January 2017 |
| 9. | Kenya | |
| 10. | Marshall Islands | Left the scheme on 1 January 2017 |
| 11. | Micronesia (Federate States of) | |
| 12. | Nauru | |
| 13. | Nigeria | |
| 14. | Niue | |
| 15. | Republic of Congo | |
| 16. | Sri Lanka | Left the scheme on 18 May 2017 following GSP+ Status |
| 17. | Swaziland | |
| 18. | Syria | |
| 19. | Tajikistan | |
| 20. | Tonga | |
| 21. | Ukraine | Will leave the scheme on 1 January 2018 |
| 22. | Uzbekistan | |
| 23. | Vietnam | |

Standard GSP beneficiaries during the 2016 -2017 reporting period

Changes in beneficiary status during 2016-2017

1.

Cameroon

Left the scheme on 1 January 2017

2.

Cook Islands

3.

Cote d'Ivoire

4.

Fiji

Left the scheme on 1 January 2017

5.

Ghana

6.

India

7.

Indonesia

8.

Iraq

Left the scheme on 1 January 2017

9.

Kenya

10.

Marshall Islands

Left the scheme on 1 January 2017

11.

Micronesia (Federate States of)

12.

Nauru

13.

Nigeria

14.

Niue

15.

Republic of Congo

16.

Sri Lanka

Left the scheme on 18 May 2017 following GSP+ Status

17.

Swaziland

18.

Syria

19.

Tajikistan

20.

Tonga

21.

Ukraine

Will leave the scheme on 1 January 2018

22.

Uzbekistan

23.

Vietnam

GSP+ beneficiaries during the 2016 -2017 reporting period

| | GSP+ beneficiaries during the 2016 -2017 reporting period | Changes in GSP+ beneficiary status during 2016-2017 |
| --- | --- | --- |
| 1. | Armenia | |
| 2. | Bolivia | |
| 3. | Cabo Verde | |
| 4. | Georgia | Left the scheme on 1 January 2017 |
| 5. | Kyrgyzstan | Joined the scheme on 27 January 2016 |
| 6. | Mongolia | |
| 7. | Pakistan | |
| 8. | Paraguay | |
| 9. | The Philippines | |
| 10. | Sri Lanka | Joined the scheme on 18 May 2017 |

Changes in GSP+ beneficiary status during 2016-2017

1.

Armenia

2.

Bolivia

3.

Cabo Verde

4.

Georgia

Left the scheme on 1 January 2017

5.

Kyrgyzstan

Joined the scheme on 27 January 2016

6.

Mongolia

7.

Pakistan

8.

Paraguay

9.

The Philippines

10.

Sri Lanka

Joined the scheme on 18 May 2017

Table 2 – GSP+ Beneficiaries 2016-2017

EBA beneficiaries during the 2016-2017 reporting period

| | EBA beneficiaries during the 2016-2017 reporting period |
| --- | --- |
| 1. | Afghanistan | 27. | Mauritania |
| 2. | Angola | 28. | Malawi |
| 3. | Bangladesh | 29. | Myanmar/Burma |
| 4. | Bhutan | 30. | Mozambique |
| 5. | Burkina Faso | 31. | Nepal |
| 6. | Burundi | 32. | Niger |
| 7. | Benin | 33. | Rwanda |
| 8. | Cambodia | 34. | Samoa |
| 9. | Chad | 35. | Sierra Leone |
| 10. | Democratic Republic of Congo | 36. | Senegal |
| 11. | Central African (Republic) | 37. | Solomon Islands |
| 12. | Comoros Islands | 38. | Somalia |
| 13. | Djibouti | 39. | South Sudan |
| 14. | Eritrea | 40. | Sudan |
| 15. | Ethiopia | 41. | Sao Tome and Principe |
| 16. | Gambia | 42. | Tanzania |
| 17. | Guinea | 43. | Timor-Leste |
| 18. | Equatorial Guinea | 44. | Togo |
| 19. | Guinea-Bissau | 45. | Tuvalu |
| 20. | Haiti | 46. | Uganda |
| 21. | Kiribati | 47. | Vanuatu |
| 22. | Lao (People's Democratic Republic) | 48. | Yemen |
| 23. | Liberia | 49. | Zambia |
| 24. | Lesotho | | |
| 25. | Madagascar | | |
| 26. | Mali | | |

1.

Afghanistan

27.

Mauritania

2.

Angola

28.

Malawi

3.

Bangladesh

29.

Myanmar/Burma

4.

Bhutan

30.

Mozambique

5.

Burkina Faso

31.

Nepal

6.

Burundi

32.

Niger

7.

Benin

33.

Rwanda

8.

Cambodia

34.

Samoa

9.

Chad

35.

Sierra Leone

10.

Democratic Republic of Congo

36.

Senegal

11.

Central African (Republic)

37.

Solomon Islands

12.

Comoros Islands

38.

Somalia

13.

Djibouti

39.

South Sudan

14.

Eritrea

40.

Sudan

15.

Ethiopia

41.

Sao Tome and Principe

16.

Gambia

42.

Tanzania

17.

Guinea

43.

Timor-Leste

18.

Equatorial Guinea

44.

Togo

19.

Guinea-Bissau

45.

Tuvalu

20.

Haiti

46.

Uganda

21.

Kiribati

47.

Vanuatu

22.

Lao (People's Democratic Republic)

48.

Yemen

23.

Liberia

49.

Zambia

24.

Lesotho

25.

Madagascar

26.

Mali

Table 3 – EBA Beneficiaries 2016-2017

7.Tables with statistical information covering countries benefiting from GSP on 1 December 2016

Table 4 – Value of preferential imports for all GSP countries (thousand EUR)

Table 5 - Value of preferential imports to the EU by Standard GSP country (thousand EUR)

Table 6 – Value of preferential imports to the EU by EBA country (thousand EUR)*

- 'Total imports cover all imports, including products which automatically benefit from most-favoured nation ('MFN') zero tariffs. 'EBA eligible imports' only references the products under the EBA scheme, which do not otherwise benefit from MFN zero duty.

Table 6 (continued) – Value of preferential imports to the EU by EBA country (thousand EUR)*

Table 7 – Value of preferential imports to the EU by GSP+ country (thousand EUR)*