Tuesday, July 17, 2012

Burma hopes for end of EU tariffs

Tuesday, 17 July 2012 13:33 Mizzima News

Burmese authorities are now discussing the lifting of tariff taxes with European countries under the EU-Asean Free Trade Agreement (FTA).

Officials from the Ministry of Commerce are now negotiating on the removal of the tariffs, following the EU suspension of sanctions in April, an official told Eleven Media Group in an article published on Monday.

The European Union said on Friday it would look to reinstate preferential access for imports from Burma, following international recognition of progress on labor reforms in the country.

The garment industry in Burma has been hurt by European tariffs which make the country less competitive than its Asean neighbors. Photo: myanmargarment.net

In a key move, the International Labour Organization (ILO) lifted punitive restrictions on Burma, in place for more than a decade, in response to a new law on trade unions and a pledge to end forced labour by 2015.

“The EU fully recognizes the importance of the ILO report and considers this a positive step forward in the process of the reinstatement of preferential market access for Myanmar/Burmese products to the European market,” the EU's foreign policy and trade chiefs said in an EU joint statement.

The EU hopes to propose allowing tariff-free imports from Burma under its “everything but arms” initiative for less developed countries, said the statement, which did not give a time frame for a decision.

The EU suspended most of its trade sanctions against Burma earlier this year after Burma released many political prisoners and allowed opposition leader Aung San Suu Kyi and her National League for Democracy to contest in the parliamentary by-elections.

Currently, six Asean-member countries enjoy EU tariff taxes of zero per cent.

In April, Myint Soe, chairman of Myanmar Garment Manufacturers Association, said that if the Generalized System of Preferences (GSP), which governs tariffs, is lifted, “We will have more business opportunities in Myanmar.” Currently, the Burmese garment and textile industry compete at a disadvantage to other Asean-member countries.

Last year, Mizzima reported that the ad hoc Group of Democratic Party Friends (GDPF), an alliance of 10 Burmese political parties and the All Mon Region Democratic Party, wrote a letter to the European Union asking it to renew Burma’s GSP status.

The letter said that if GSP status were renewed, small and medium-sized businesses throughout the country would have more economic opportunities.

Currently, the EU has granted GSP status to 176 developing countries, which grants lower or zero tariffs for those countries. The objective is to help developing countries expand the sale of their products to European countries and to promote the industrialization of developing countries, according to the EU website.

“If the EU grants GSP status to Burma again, ordinary people will gain great advantages,” said Dr. Than Nyein, the chairman of the National Democratic Force party. “Moreover, small and medium-sized businesses will get into the European market. If our goods are exempted from duty, we will have great opportunities.”

The EU revoked Burma’s GSP status 15 years ago in response to the military junta’s crackdown on the democracy movement.

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