Is GSP+ a Plus? - A Mixed Method Review of Trade Preference Scheme GSP+

Abstract: The EU, being the largest trading partner for many developing countries, offers a General Scheme of Preferences (GSP) as a voluntary trade promoting scheme. Through GSP+, an extension of GSP, the EU offers additional market access conditional on commitment to sustainable development and good governance. Using a Gravity Equation, I find insignificant trade creating effects on GSP+ in comparison with standard GSP. With the help of stakeholder interviews in GSP+ beneficiary Sri Lanka I find several examples of how the scheme has had incentivising effects on respect for human and labour rights. The quantitative results are in line with previous research and point to the fact that improvements could be made to GSP+. Some possible problems found surrounding the scheme are; strict Rules of Origin, information asymmetry and uncertainty of access.