No C 18/22 Official Journal of the European Communities 23.1. 78 
Opinion on the Commission's proposals concerning the European Community's scheme 
of generalized tariff preferences for 1978 
The text referred to the Committee has been published in Official Journal of the 
European Communities No C 242 of 10 October 1977, page 1. 
A. LEGAL BASIS FOR THE OPINION 
On 16 August 1977 the Council referred the abovementioned proposals to the Economic 
and Social Committee in accordance with Article 198 of the Treaty establishing the 
European Economic Community. 
B. OPINION OF THE ECONOMIC AND SOCIAL COMMITTEE 
The Economic and Social Committee prepared its opinion on the above matter at its 
152nd plenary session held in Brussels on 26 and 27 October 1977. 
The full text of the opinion is as follows: 
THE ECONOMIC AND SOCIAL COMMITTEE, 
Having regard to the Treaty establishing the 
European Economic Community, and in particular 
Article 198 thereof, 
Having regard to the request for an opinion made 
by the Council on 16 August 1977, 
Having regard to its Rules of Procedure, and in 
particular Articles 22 and 29 thereof, 
Having regard to the decision taken by its Bureau on 
21 June 1977 instructing the Section for External 
Relations to draw up an opinion on the matter, 
Having regard to its past opinions on generalized 
tariff preferences, and in particular the opinions of 
24 September 1975 (*) and 29 September 1976 (2), 
Having regard to the Committee's opinion on the 
GATT multilateral trade negotiations (3), 
Having regard to the oral report made by the 
rapporteur, Mr Dietmar Cremer, 
Having regard to the opinion issued by the Section 
for External Relations on 11 October 1977, 
Having regard to the discussions at its 152nd plenary 
session held on 26 and 27 October 1977 (meeting of 
26 October 1977), 
HAS ADOPTED THE FOLLOWING OPINION 
with three votes against and three abstentions: 
t1) OJ No C 286, 15. 12. 1975. 
(2) OJ No C 281, 27. 11. 1976. 
(;i) OJ No C 126, 28. 5. 1977. I. The generalized tariff preference proposals 
for 1978 
1.1. The Commission is now submitting to the 
Council its eighth series of proposals on generalized 
tariff preferences. Since 1971 the Community has 
applied such preferences to imports from certain 
developing countries and territories under a unilateral 
10-year offer it made to UNCTAD in 1969. 
1.2. The generalized system of preferences (GSP) 
covers a number of agricultural products of Chapters 
1 to 24 of the Common Customs Tariff (CCT) and 
all the finished and semi-finished industrial products 
of Chapters 25 to 99 of the CCT. It provides 
reductions in import duty for agricultural products — 
some of which are also subject to quotas — and for 
jute and coir. In some instances there is complete 
exemption from duty, which is granted subject to 
tariff quotas or ceilings in the case of industrial 
products. 
1.3. Each year, improvements are made in the 
scheme by using more recent basic statistics for the 
calculation of the preferences, so as to increasingly 
alleviate the difficulties developing countries are 
generally faced with in finding outlets for their 
products. 
1.4. It should be borne in mind that the 1977 
GSP represents a relatively large improvement on the 
arrangements in force in 1976. 
1.5. The Commission proposes the following 
arrangements for 1978, over and above the conces­
sions incorporated in the 1977 GSP: 
— the agricultural sector: the inclusion of some new 
products (horses for slaughter and other horses, 
certain kinds of crustaceans and molluscs, dried 
garlic, limes, tropical fruit cocktails and certain 
23.1. 78 Official Journal of the European Communities No C 18/23 
kinds of fruit and vegetables during the winter 
season) and the inclusion of a limited reserve 
share in all GSP tariff quotas for agricultural 
products; 
— industrial semi-manufactures and manufactures: 
raising of the ceilings as a result of the adoption 
of a new reference year (1975). In the case of 
some products, however, the ceiling will not be 
raised beyond a certain level or will not be 
raised at all; 
— textile products: the ceiling is to be raised only 
in the case of carpets; in the case of coir and 
jute products, the tariff suspension granted by the 
Community as a counterpart to the voluntary 
restraint agreements negotiated with India (jute 
and coir) and Bangladesh (jute) is to be continued 
and should reach 100 °/o from 1 January 1978; 
— technical improvements in: (1) the tariff quota 
system (extension of the application of a limited 
reserve share to all the GSP tariff quotas in the 
industrial sector, except for ECSC products), (2) 
the special maximum country amounts (more 
flexible application of the national shares), and 
(3) the arrangements for semi-sensitive and non-
sensitive products (in the case of the last 
developed countries, no reintroduction of duty 
under the ceiling provisions); 
— extension to Romania of preferences for a 
number of additional products; 
— all products: the technical adjustments of the 
rules of origin necessitated by the inclusion of 
certain agricultural products, amendments to the 
nomenclature and the introduction of the 
European unit of account. 
1.6. The Commission is to continue its efforts to 
make the Community GSP better known by 
organizing seminars and publishing practical guides. 
In its explanatory memorandum the Commission 
draws attention to its proposal for the setting-up of 
an agency for trade cooperation with the developing 
countries. 
II. Comments 
2.1. The Committee would refer to its past 
opinions on the Commission's annual proposals for 
fulfilling the commitments which were given to 
UNCTAD in 1969 for the period up to 1981. The 
comments made in these opinions still hold good, 
especially those on the 1977 generalized tariff 
preferences scheme. The Committee would also draw 
attention to its recent opinion on the GATT 
negotiations and, more especially, to the remarks 
made therein on the subject of trade relations 
between the Community and the developing 
countries. 2.2. In its proposals for the 1978 GSP, the 
Commission has opted for a more cautious line than 
that taken in the 1977 arrangements. The Committee 
endorses this approach. As long as economic 
recovery remains hesitant in the Community, the 
latter should take care not to enter into commitments 
that could call into question or endanger the bases 
of its own equilibrium on which an effective policy 
towards the Third World depends {inter alia by 
applying ceilings and monitoring penetration levels). 
2.3. The Committee would emphasize more than 
ever the need to ensure that the scheme operates in 
such a way as to help first and foremost those coun­
tries with the greatest need. Recent statistics show that 
this is not yet sufficiently the case and that much 
has still to be done to make the GSP effective in 
relation to its stated aims. 
2.4. In addition, the Committee would once again 
point out the need for coordination of all the systems 
of generalized preferences applied by the industri­
alized countries. 
2.5. Within the limits of the preferences at present 
granted, the Community could usefully enhance the 
effectiveness of its GSP by stimulating imports of 
products which are considered to be non-sensitive 
and for which the rate of preference utilization is 
still relatively low. The aim here should be to help 
above all the poorest countries. 
2.6. The Committee would refer to the comments 
made recently in various opinions about the need to 
match the Community's external policy with 
appropriate internal policies and structures. It would 
emphatically reiterate that any new commitment of 
a commercial, financial or any other nature towards 
third countries should take account of the following 
requirements: 
— such commitments must be based largely on 
interests common to the partners and the 
Community, 
— the partners must, in their relations with the 
Community and in the international context, 
behave in a manner compatible with the Agree­
ments concluded (this is particularly essential in 
the case of unilateral concessions), so that there 
is a healthy situation as regards competition; this 
applies especially in respect of prices (e.g. no 
dumping), regularity of supply, terms of payment 
and access to markets, 
— the partners on both sides must recognize 
fundamental human rights and observe minimum 
social standards for workers. 
No C 18/24 Official Journal of the European Communities 23.1.78 
employment, reasonable utilization of resources and 
production capacity and, on a more general level, 
economic growth. 
2.8. On the basis of the above comments, the 
Economic and Social Committee approves the 
Commission's proposals. 
The Chairman 
of the Economic and Social Committee 
Basil de FERRANTI 
ANNEX 
to the opinion of the Economic and Social Committee 
The following amendment was rejected during the discussions. 
Insert the following new paragraph between the present paragraphs 2.1 and 2.2: 
'The Committee therefore thinks it deplorable that neither the Commission nor the Council 
have taken any account whatsoever of its previous opinions. The Commission has been 
led into making proposals regarding agricultural products that undermine the common 
agricultural policy because it did not first study the effects of GSP concessions on each 
sector. These concessions always put the squeeze on highly specialized products, and 
gradually they are depriving farmers of any opportunity to switch from sectors in surplus 
to sectors where there are shortages. Among the products that have been particularly hit 
are horses for slaughter and limes from the French overseas departments.' 
Reason 
The general terms of the amendment are clear. 
As regards horses for slaughter, the concessions here come at a time when France has just 
begun to try to give production a new lease of life, especially in mountain regions. 
Similarly, it is regrettable that duties on limes are being cut just when this product, which is 
particularly cultivated in the French overseas departments, is beginning to find an outlet in the 
Community. 
Voting 
For: 28, against: 32, abstentions: 12. 
Opinion on the proposals for: 
— a Council Directive concerning operations qualifying for a higher rate of intervention 
by the European Social Fund 
— a Council Decision regarding European Social Fund assistance towards women 
The text referred to the Committee has been published in Official Journal of the 
European Communities No C 250 of 19 November 1977, page 5. 2.7. In conclusion, the Committee urges that, in 
future, the Community's trade commitments should 
form part of an overall common commercial policy — 
a policy that is effective and in keeping with the 
Community's political roles in the world and a policy 
that reflects the essential requirements of internal 
economic and social policy, particularly as regards 
Done at Brussels, 26 October 1977.