What is the Generalized System of Preferences (GSP)?

The Generalized System of Preferences (GSP) is fundamentally designed to provide preferential duty treatment for developing countries, which aligns with the objective of increasing their export potential and fostering economic growth. By allowing certain products to enter developed countries at reduced tariffs or even duty-free, it supports the efforts of these nations to integrate into the global economy.

This program serves as a form of economic assistance and encourages the development of trade relationships, thereby promoting sustainable economic growth and reducing poverty. The preferential treatment under GSP helps to make their goods more competitive in international markets, allowing these developing countries to benefit from trade opportunities that they might not otherwise have.

The other options do not accurately represent the purpose of the GSP. For instance, the GSP does not aim to enhance trade with all countries, nor does it impose higher duties or require inspections on all imports. Instead, it specifically targets trade with developing nations by offering favorable tariff conditions to help boost their economic status.