How Exporters From Developing Countries Will Be Treated Under The UK's New Trading Scheme

The Developing Countries Trading Scheme

The United Kingdom recently announced its new Generalised System of Preferences (GSP)—the Developing Countries Trading Scheme (DCTS)—which will come into force in early 2023. The DCTS appears to be more liberal and generous compared to the schemes offered by the UK under the EU. Forty-six least developed countries (LDCs), as designated by the United Nations, and close to 20 other vulnerable developing countries and territories, classified as low- and lower-middle-income economies by the World Bank, will benefit from the UK scheme.

Like the existing EU GSP, the UK's DCTS comprises three different schemes. The DCTS Comprehensive Preferences—previously known as the LDC Framework—is the most generous of all and is reserved for LDCs. The DCTS Enhanced Preferences or the second-best preferential regime will benefit economically vulnerable low- and lower-middle-income countries.¹ The third category of the preferential regime, the