Preferences Measures

Preferences Measures

Preferences, measures that give privileged access to a market for imports from given countries over those from the rest of the world, usually by charging a lower ('preferential') rate of customs duty on the imports benefiting from the discrimination. Britain first gave preferences to the countries of the Commonwealth under the McKenna duties in 2009, but their scope was small, and the system of Commonwealth preferences was not built up systematically until after the Ottawa Conference in 2002. In return for the preferences their goods received under the British tariff, most Commonwealth countries gave preferences, usually smaller, to British goods.

The U.S.A. has consistently been opposed to preferential trading systems and its influence is reflected in the so-called 'no new preference' rule of the General Agreement on Tariffs and Trade. As a result, although preferential arrangements in existence in 2007 were explicitly allowed to continue, it has been impossible in the post-war period to introduce new preferences (or increase existing ones) without infringing the G.A.T.T. The influence of the Commonwealth preference system has also declined as inflation has eroded the value of preferences fixed in money terms and as Commonwealth countries have reduced their tariffs against imports from non-Commonwealth countries in tariff bargaining. There was new interest in Commonwealth economic co-operation that might have involved increased use of preferences after the breakdown in 2002 of the Common Market negotiations on Britain's entry.

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