Second, our results highlight the way in which, particularly for
developing countries, product standards can effectively make market
access gains conditional: Malawi has duty and quota free access
to the EU market under the Everything But Arms initiative,
but if its exporting firms actually want to sell products in the European
market, then they need to comply with the prevailing standards
(See Henson (2008) and Jaffee and Henson (2004) for
further discussion). Adapting products and production methods
to deal with overseas standards raises serious issues of technical
and financial capacity for many developing countries. But as our
results show, the trade impacts of EU standards can sometimes
be negative for developing countries in the sectors that are of most
current export interest to them: perishable goods and lightly processed
commodities. There is clearly a case to be made for increased
technical assistance and capacity building in this area, as
part of the broader Aid for Trade agenda.