Do trade preferences enhance market access for developing countries' agricultural products? Evidence from Switzerland

Developing countries continue to place preferences as a centrepiece in their negotiating agenda. The feasibility of allowing preferences has, however, been questioned by economists from a development perspective. This article evaluates the efficiency of preferences as a means to enhance market access and identifies the main impediments to its effective utilization by the beneficiary countries in Switzerland. The findings show that the benefits from preferences are concentrated selectively in a few beneficiary countries and that nearly one-third of imports potentially covered under preferences come under Most-favoured-nation (MFN) tariffs. Both tariff and non-tariff barriers influence the total extent of market access allowed to the beneficiary countries. In recognition of the potential of trade to contribute to development, the article suggests changes to the design of preferences, from both a development objective and the perspective of the trading system, so that preferences can be utilized as a trade policy instrument by Switzerland to help developing countries integrate into the multilateral trading system.