What is common effective preferential tariff?

Common Effective Preferential Tariff (CEPT) is a preferential tariff scheme among member countries of a trading bloc that aims to reduce or eliminate tariffs on goods traded within the bloc, while maintaining relatively higher tariffs for goods imported from non-member countries. The goal of CEPT is to promote economic integration and trade among member countries, and to create a common market. Here are some key points about CEPT:

- CEPT is usually implemented as part of a regional trade agreement (RTA) or free trade agreement (FTA) between countries.

- Under a CEPT scheme, member countries agree to gradually reduce tariffs on goods traded among themselves, according to a predetermined schedule and based on a common set of rules.

- The process of tariff reduction in a CEPT scheme is often reciprocal, meaning that each member country commits to reducing tariffs on an equivalent basis.

- The ultimate objective of CEPT is to achieve zero or very low tariffs on substantially all goods traded within the bloc, creating a common market for goods and services.

- CEPT can lead to increased trade, economic growth, and efficiency within the bloc, as well as enhanced competitiveness of member countries in international markets.

CEPT schemes have been implemented in several regional trade agreements around the world, including the European Union (EU), the ASEAN Free Trade Area (AFTA), the Southern Common Market (MERCOSUR), and the Andean Community.