EU calls for Laos, Cambodia to improve product quality
The European Union will not relax its standards for goods imported from least developed countries and has called for Laos and Cambodia to improve the quality of products to meet EU market requirements.
The EU strongly insists on importing high quality products as it does not want to bring in goods that pose a health risk, according to EU trade experts.
Asean Policy Coordinator for EU Mr Raffaele Quarto was speaking to South East Asian journalists during a seminar on EU trade policy for journalists from the region held in Brussels, Belgium, from December 5-7.
Mr Quarto explained that Laos currently has a problem complying with the EU’s standards.
Despite the union granting zero tariffs to Lao goods entering the EU market under the Generalised System of Preferences (GSP), Laos’ lack of quality goods means producers are not making full use of the GSP system.
“We cannot lower our standards in Europe because consumers need to be protected and need good quality products. The only way is to improve the quality of your products by attracting investment from countries that have the technology to do this – such as from the EU,” Mr Quarto said.
The EU is in the process of reforming its GSP, he said, and a new system will come into force in 2014.
Under this reform, the number of countries currently benefiting from the GSP will be reduced. China and India will not be included as “they are now developing a lot and don’t need help so it’s better to use the GSP system for countries that are in need, such as Laos and Cambodia,” said Mr Quarto.
“Laos will definitely stay in the system. Actually, what will happen is that the new system will be more focused on countries like Laos that need more assistance.”
Every year the EU spends several million euros building the capacity of government officials and producers in least developed countries including Laos, to bring their products and services up to EU standards.
The EU is in the process of establishing free trade agreements with some Asean member countries, including Singapore and Malaysia, which are expected to be finalised in 2012. The EU is also keen to negotiate agreements with other Asean countries, including Vietnam, Indonesia and Thailand.
However, Laos will not be starting AFTA negotiations with the EU in the near future as the union wants Laos to firstly make full use of the GSP. Laos can then start AFTA negotiations with the EU once it’s fully ready to do so.
With an agriculture-based economy, Cambodia faces similar problems accessing the EU market due to the high standards required.
The EU is one of the key donors providing trade related assistance to Laos through different channels of funding – bilateral, regional and thematic.
In 2009, the total value of EU-Lao trade was around 230 million euros. The main exports from Laos to the EU are garments and textiles, representing 71 percent.
