The European Commission yesterday (17 September) took a step towards reinstating trade preferences for Burma/Myanmar, in a move that would give products such as clothing duty- and quota-free access to the European market for the first time since 1997.

The plan is to bring the country back under the so-called 'Everything But Arms' trade regime, which is part of the EU's Generalised System of Preferences (GSP). It applies to Burma because it is classified as a Least Developed Country (LDC) by the United Nations.

"Since Myanmar/Burma started to open up earlier this year I saw the need to underpin such deep and important changes with real economic support once key improvements for the workforce had been met," explained EU Trade Commissioner Karel De Gucht.

"Trade is fundamental to supporting political stability and the EU's trade preferences mean we will give this reform-minded country priority access to the world's largest market."

The move should give a boost to Burma's clothing exports, which accounted for most of the country's EUR169m (US$221m) shipments to the EU in 2011. The EU, however, makes up just 3% of Burma's total exports, and 0.01% of the EU's total imports.

Burma was suspended from the GSP scheme in 1997 as a result of its "serious and systematic" violations of core international conventions on forced labour.

In June this year, the International Labour Organisation (ILO) concluded that significant progress had been achieved by Myanmar/Burma, although some residual problems with forced labour persist. On this basis, EU law foresees that preferences should be reinstated.

The proposal now needs the approval of the EU's 27 member states and the European Parliament.

The latest efforts to do business with Burma come after the European Union (EU) in April decided to suspend most of its trade and economic sanctions against the country.

The US, meanwhile, is moving more slowly than the EU in lifting sanctions.

Earlier this year it decided to ease financial and investment restrictions against the country in response to reforms over the past year, thereby allowing the first new US investment for nearly 15 years.

But last month it renewed trade sanctions on Burma for another three years. The import ban has been in place since 2003 to prevent goods from Burma entering the US market, but the latest legislation gives the Administration the authority to waive or terminate the import sanctions.