# CE2004088EN.01003401.xml

| 8.4.2004 | EN | Official Journal of the European Union | CE 88/34 |
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8.4.2004

EN

Official Journal of the European Union

CE 88/34

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(2004/C 88 E/0036)

WRITTEN QUESTION E-1484/03

by Charles Tannock (PPE-DE) to the Commission

(2 May 2003)

Subject:   Graduation of General Sector Preferences Sector V imports with respect to employment alternatives to illegal drug production in Colombia

Subject:

For some time now Colombia has benefited from trade preferences in the form of General Sector Preference Sector V goods — the so-called ‘drugs’ regime which was designed to help Columbia fight illegal drug production by offering greater opportunities for the production of other products including cut flowers. Although Eurostat figures show that Colombia's market share declined from 20,15 % in 1997 to 15,41 % in 2001, the Commission is believed to be in favour of ‘graduating’ Sector V imports which would remove these preferences.

Could the Commission explain its reasoning and indicate whether or not it accepts that there is a conflict between the promotion of its GSP ‘drugs’ regime on the one hand and the application of its Sector V ‘graduation’ policy on the other? Finally, what other forms of assistance can the Commission provide to Colombia which would directly assist the authorities in their attempt to encourage the cultivation of alternative crops in that country?

Answer given by Mr Lamy on behalf of the Commission

(27 May 2003)

(27 May 2003)

The General System of Preferences (GSP) aims at encouraging the economic development of beneficiary countries in enhancing their exports towards the Union. Its objective is to kick off new exports from beneficiary countries. This means that the preferential treatment has to cease at the time this objective is achieved. The GSP is an incentive which should be removed at the time it is not needed any more, thus targeting those countries and sectors which need it most.

Colombian cut flowers (Sector V in GSP) reached a very high level of competitiveness of their own in international markets. Being graduated will not prevent Colombia to export flowers, for which quality, level of price, etc. account more in their success than the re-establishment of the customs duty to be paid by the European importers. Hence, GSP should now help Colombia to diversify, and focus on other products for which Colombia has some margin of improvement at export.

The GSP ‘drug regime’ has been fully applied from 1992 to 2002 without any graduation. However, graduation is an important element for the objective and non-discriminatory application of the ‘drug-regime’ in accordance with the EC's obligation under the World Trade Organisation (WTO) Agreements. Incidentally, as far as the Colombian specific case is concerned, more than 85 % of its exports of cut flowers (major part of sector V) are shipped to the United States' market.

The preferential access to the Community market that Colombia has enjoyed through the so-called ‘drug-regime’ is almost the best possible trade treatment that can be granted to a developing country. Hence, the Colombian decline in the Community's market shares referred to in the question must be explained by broader economic competitiveness elements.

The Commission considers that there is no conflict, on the contrary, between the promotion of its GSP ‘drug-regime’ on one hand, and the application of the graduation mechanism on the other.

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