DTIS, Volume I - Enhanced Integrated Framework (EIF)

EBA. Appropriate transition arrangements will be required to ensure preferential access
for Maldivian exports of canned tuna to Europe.
Japan also operates a scheme, which grants preferential treatment to 149 developing
countries, with special treatment for 47 least-developed countries (in terms of tariff-and
quota-free access). Exports to Japan from the Maldives also account for a further quarter
of total exports. These exports are mostly fresh, frozen and dried fish. However there are
no GSP or LDC GSP provisions for fresh and frozen fish, but there is duty free entry
under GSP for dried fish.
Maldives also benefits from the other GSP schemes offered by many developed
countries. However, there are currently practically no exports to those countries, so no
benefits are being realized.
VII. Trade Implications of Graduation from LDC Status
After some years of study, the UN ECOSOC adopted a report in June 2004
recommending the graduation of Maldives from LDC status from November 2007.
However, because of the tsunami, the UN is known to be supportive of deferring this
date.
Theoretically, graduation from least-developed country status will affect the privileges
and preferences that Maldives currently enjoys under the multilateral trading system as an
LDC member of the WTO. As the graduation of an LDC is unprecedented since the
establishment of the WTO in 1995, the graduation of the Maldives will establish some
important precedents for the trade body in regard to transitional arrangements. Indeed,
WTO members (through the Committee for Trade and Development, CTD) have
responded cautiously and agreed to grant the Maldives a transitional period based on a
roadmap for graduation to be prepared by the Maldives government.
However, in tangible terms, there are two major consequences of Maldives graduating
from LDC status: loss of preferential market access; and possible reduction in trade
related technical cooperation. In addition, there are also implications for the Maldives in
regard to its WTO obligations. Each of these three consequences is considered in turn.
In regard to the loss of preferential market access, the consequences will be serious. Of
the 168 items exported by the Maldives (counting the same product exported to different
destinations separately and the EU as one country) 19 only three items 20 gain any
preferential market access as a result the country’s LDC status. These are canned tuna
and fresh/chilled tuna loins to EU and dried skipjack to Japan.
19 Calculated from Maldives Customs Service Statistical Year Books 1999-2003
20 Excluding SAARC exports (which will all be duty free under SAFTA)
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