A Review of Trade Preference Schemes for the World’s Poorest Countries

Date period
23 October 2012

SummaryThe current low participation of least developed countries (LDCs) in world trade could be a critical factor hindering their development. In fact, today LDCs only  account for about one per cent of world trade. As a result, the international community has put in place a number of initiatives aimed at stimulating LDCs participation in the international trading system. These initiatives include supporting LDCs with preferential market access as well as special and differential treatment in regard to their international trade obligations.
This study analyses the implementation of preferential trade schemes in seven major markets - Canada, China, European Union, India, Japan, Korea, and the United States - and simulates the possible impact on LDCs stemming  from extending full duty free and quota free market access in concluding non-agriculture market access negotiations in the Doha Round. The paper provides detailed information on country and product coverage, limitations on the schemes, and estimates of their value.
The analysis aims to contribute to the on-going discussions in the WTO and beyond. It also provides information that LDCs’ trade and development partners can consider in designing future preference schemes for the world’s poorest economies.