Social and human rights impact analysis

• Author: Development Solutions Europe Limited, Directorate-General for Trade (European Commission)
• Pages: 93-110

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3 Social and human rights impact analysis

This section will discuss the social impact of the GSP on the beneficiary countries. It will

address the following evaluation questions:

(i) What has been the impact of the present scheme on developing countries and

LDCs?

(ii) What are the factors influencing the achievements observed?

(iii) What unintended consequences, if any, can be linked to the design,

implementation, or use of the current GSP?

It will first analyse the literature on the social and human rights i mpact of the GSP prior

to the reforms implemented as of 2014 (Section 3.1). This will be followed by a detailed

review of the social and human righ ts impact of the GSP in Section 3.2, including a

dedicated review of the impact of the GSP+ arrangement (Sections 3.3 and 3.4).

Section 3.5 will provide fresh data and country rankings on social progress for the

beneficiary countries under investigation using the Social Progress Ind ex (SPI). Further

information will be provided on the impact of the GSP on employmen t, on the four pillars

of the Decent Work Agenda, on working conditions, on poverty r eduction, on human

rights, and on gender equality in the four country case studies.

3.1 Lessons learnt from literature

Literature on the social and human rights impact of the GSP has largely been of a

descriptive and qualitative nature, using country case studies to provide a more detailed

account of the impact. The impact has largely been equated with a beneficiary’s

ratification and effective implementation of international conventions on labour and

human rights.

Overall, the literature does not offer any widely held consensus on the concrete impact

of the EU’s GSP on labour and human right s. An extensive body of literature and analysis

suggest that trade and economic growth have a positive effect on poverty reduction. In

this respect, the GSP is considered to be an instrument for reducing poverty in

developing countries as economic growth triggered through trade liberalisation drives

poverty reduction.123 However, it is also pointed out that no direct link between trade

liberalisation, economic growth and poverty reduction can be drawn.

The literature review shows that in som e instances the linkage between trade

liberalisation and economic growth may be negative. It also reveals that enhanced

economic growth does not always translate into reduced poverty. Nevertheless, studies

suggest that the scheme’s induced human rights promoti on can have a beneficial indirect

impact on poverty reduction as it supports structural changes in society. 124

The EU may withdraw trade preferences temporarily when it identifies serious and

systematic infringements of the basic obligations for the GSP. These violations include

unfair trading practices, export of goods made by prison labour and systematic violations

of international conventions and agreements on labour and human rights. It has been

pointed out in literature that the EU h as not always applied the withdrawal mechanism

123 Cardamone, P. and Scoppola, M. (2012). The Impact of EU preferential Trade Agreements on Foreign Direct

Investment. Available at: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2178874

124 CARIS. (2010). Mid-Term Evaluation of the EU’s Generalised System of Preferences; Beke, L., D’Hollander,

D., Hachez, N. and Pérez de las Heras, B. (2014). Report on the integration of human rights in EU development

and trade policies.

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consistently and in a transparent manner. 125 This in turn impacts the scheme’s

effectiveness in the social and human rights dimension, as the beneficiary status is

associated wi th “endorsing a third country’s human rights record.”126 The application of

the withdrawal mechanism can hence compromise the scheme’s effective promotion of

social and human rights in the beneficiary countries.127 Criti cal analysis holds the view

that “the impact and credibility of the EU’s approach to human rights in its external trade

policy has been called into question because of the selective and uneven application of

these human rights instruments.”128 Some cases of violation of core labour standards or

human rights such as in Uzbekistan and Turkmenistan have not had negative

consequences for the respective countries; whereas in other cases, the EU has a cted and

withdrew preferences from the violating countries, including Myanmar/Burma, Belarus

and Sri Lanka.129

The scheme’s concrete impact on improving social and human rights standards depends

highly on the specific case and beneficiary country, and is not uniform across countries.

This is enforced by the fact that each country seeks to meet its obligations, and in

particular the GSP+ commitments, in its individual context. In this respect, the eligible

countries face different issues, challenges and constraints. 130 The literature suggests

that, in order to identify a tangible positive impact on the social conditions of a

beneficiary country, effective monitoring of the actu al implementation of the relevant

provisions and conventions is essential.

In the 2010 CARIS study, it was sugg ested that the effective implementation of labour

rights and human rights conventions primarily relates to social and economic rights and

the adequate provision of education and health services. It was specifically noted that

“costs of implementation are an important factor in countries' decisions to adopt

international labour conventions”. 131 However, despite the costs associated with

guaranteeing social and economic ri ghts, the potential benefits for beneficiary countries

are far greater. As demonstrated by the 2016 Europ ean Commission Report on the GSP+

arrangement, several countri es still lack full compliance with the convention’s

requirements, which are insuffi ciently implemented in domestic laws or lack adequate

reporting.132

Overwhelming consensus can be found on the potenti al positive impacts of the scheme

on labour and huma n rights in th e beneficiary countries. In particular, the GSP+

monitoring and reporting process is expected to have the potential to bring about change

in law and practice of l abour and women rights.133 This may be demon strated by the

specific case of El Salvador, in which the country’s Supreme Court found ILO Conv ention

No. 87 on Freedom of A ssociation and the Right to Organise to be incompatible with the

Constitution of El Salvador. This ruli ng was followed by an examination of the European

125 Velluti, S. (2016). The Promotion and Integration of Human Rights in EU External Trade Relations; Beke, L.,

D’Hollander, D., Hachez, N. and Pérez de las Heras, B. (2014). Report on the integration of human rights in EU

development and trade policies.

126 Beke, L., D’Hollander, D., Hachez, N. and Pérez de las Heras, B. (2014). Report on the integration of human

rights in EU development and trade policies.

127 Velluti, S. (2016). The Promotion and Integration of Human Rights in EU External Trade Relations; Beke, L.,

D’Hollander, D., Hachez, N. and Pérez de las Heras, B. (2014). Report on the integration of human rights in EU

development and trade policies.

128 Velluti, S. (2016). The Promotion and Integration of Human Rights in EU External Trade Relations, p. 41.

129 Velluti, S. (2016). The Promotion and Integration of Human Rights in EU External Trade Relations; Beke, L.,

D’Hollander, D., Hachez, N. and Pérez de las Heras, B. (2014). Report on the integration of human rights in EU

development and trade policies.

130 European Commission. (2016). GSP+ report on Sustainability, Human Rights and Good Governance.

Questions and Answers. Available at: trade.ec.europa.eu/doclib/docs/2016/january/tradoc_154179.pdf

131 CARIS. (2010). Mid-Term Evaluation of the EU’s Generalised System of Preferences, p. 10.

132 European Commission. (2016). Joint Staff Working Document on the EU Special Incentive Arrangement for

Sustainable Development and Good Governance (GSP+) covering the period 2014-2015. (SWD (2016) 8 final).

133 Humbert, F. (2008). Do Social Clauses in Generalised Systems of Preferences Advance the Cause of

Women?