ISLAMABAD: The European Union (EU) is likely to extend existing Pakistan’s GSP (Generalized System of Preferences) for another four years, i.e., till 2027 as the European Council has endorsed recommendations of European Commission (EC), well informed sources told Business Recorder.
There were serious differences in Brussels-based EU Parliament and European Council on a new proposed ten-year GSP scheme; however a new Parliament will be elected in June next year.
According to sources, proposal for extension of four years in existing GSP has landed in European Parliament’s Committee on International Trade (INTA), which will vote on proposed extension in the existing scheme.
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At its next meeting scheduled on 18-19 September 2023, the International Trade Committee (INTA) will consider the draft recommendation for consent on the conclusion of the FTA between EU and New Zealand together with the accompanying draft resolution. Members will then vote on the extension of the current scheme of GSP.
“Islamabad believes that the proposal should sail through the INTA as none of the members have raised any objections so far,” an official on condition of anonymity stated. However, Pakistan has to go through the process of EU Reviews, conducted after every two years. Two more Reviews will be added. The report of current Review of the EU is yet to be unveiled.
There is a strong perception in the federal government that technically things are on right track but incidents like Jaranwala where violent mobs attacked churches and homes of Christian residents is worrisome. Such incidents create problems at international forums.
The issues of human rights violation, child labour, etc., are expected to be made part of EU Review Report.
Both the EU Parliament and European Council have strong opposing arguments due to which things are not moving forward, the sources added.
The European Council defines EU’s overall political direction and priorities, traditionally by adopting conclusions. It does not negotiate or adopt EU laws.
Pakistan has done extensive lobbying for the new scheme besides making all efforts to comply with the 27 Conventions.
Pakistan is a major beneficiary of the trading opportunities offered by the EU GSP. From 1st January 2014, Pakistan benefited from generous tariff preferences (mostly zero duties on two thirds of all product categories) under the so-called GSP+ arrangement aiming to support sustainable development and good governance. In order to maintain GSP+, Pakistan has to keep ratification and effectively implement 27 core international conventions on human and labour rights, environmental protection, and good governance.
The EU- Pakistan bilateral trade stood at $ 14.857 billion, of which Pakistan’s exports were $9.865 billion in 2022 against $ 6.639 billion in 2021 whereas imports were at $ 5.392 billion as compared to $ 5.544 billion.
Pakistan’s main exports to EU are textile articles, sets, worn clothing, articles of apparel, knits or crocheted, cotton, beverages, spirits and vinegar, cereals, articles of leather, animal gut, harness, travel good, manmade staple fibers, toys, games, sports requisites, etc.
The EU continuously monitors GSP+ beneficiary countries’ effective implementation of the 27 international conventions on human rights, labour rights, environmental and climate protection, and good governance. This monitoring includes exchanges of information, dialogue and visits, and it involves various stakeholders, including civil society.
The Commission publishes a report on the implementation of GSP every two years, providing information on the progress made by the GSP+ beneficiary countries in implementing the 27 international conventions.
Copyright Business Recorder, 2023