Preferential trade agreements are thought of as an important instrument for integrating the developing (DCs) and least developed countries (LDCs) into the world trading system. The Everything But Arms initiative (EBA) of the European Union (EU) and the African Growth and Opportunity Act of the United States (US) consist of trade agreements that aim at increasing trade flows between developed countries and LDCs in order to stimulate growth. On average, the initial impact of EBA on LDCs total exports to the EU is small, whilst the limited export success is not uniform across countries due to a number of reasons. Firstly, rules that govern trade under the EBA, such as those on transport and the definition of the origin of the products, are thought to result in under-utilisation of preferences due to increasing trade costs (Brenton, 2003). Secondly, EBA has extended duty free access to a small number of agricultural products, whilst access for the majority of products was complete under the Generalised System of Preferences (GSP) and the Cotonou Agreement. In addition, a number of LDCs are unable to take advantage of EBA due to the current composition of their exports, as products that are traditionally exported to the EU markets have been receiving duty-free access under other agreements.