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EU opens window for Pakistan export

Publication Date : 01-11-2012


The European Union yesterday opened a window for Pakistan to apply for zero-tariff scheme under the Generalised Scheme of Preferences (GSP) to be effective from Jan 1, 2014.

In this regard, the EU has published the much awaited revised import preference scheme yesterday paving way for 89 countries including Pakistan to avail the facility of duty free exports to 27-member EU countries.

The current GSP scheme will remain valid until Jan 1, 2014, thus giving countries ample time to adapt to the revised GSP plus regime. Pakistan value added textile sector will be the major beneficiary of the new scheme.

As a result of this development, Pakistan will formally submit an application with the EU in January 2013, an official in the commerce ministry said.

Pakistan has already benefited from reduced tariffs under the overall GSP scheme. However, if Pakistan can qualify for the GSP plus scheme, it offers the possibility for Pakistani companies to benefit from zero tariffs on all products being exported to the European Union.

An official statement issued here said, the EU publication contains the specific tariff preferences granted under the GSP in the form of reduced or zero tariff rates and the final criteria for which developing countries will benefit.

As per the criteria, Pakistan classified among the low and lower income countries, will enjoy more opportunities to export as competitors exit the scheme. But to qualify for GSP plus, Pakistan will also need to prove that it is serious about implementing international human rights, labour rights and environment and good governance conventions.

“It is very exciting that EU Member States and Members of the European Parliament have backed the European Commission’s proposal to make our preferential import scheme more effective. It represents an important opportunity for Pakistan’s relations with the European Union, not just in terms of trade but also for our overall political and economic relations,” said EU Ambassador, Lars-Gunnar Wigemark.

The EU is Pakistan’s single largest trade partner with bilateral trade exceeding €8.1 billion (US$10 billion) in 2011. In 2011, imports to the EU that received GSP preferences were worth €87 billion, which represents around 5 per cent of total EU imports and 11 per cent of the total EU imports from developing countries.

“We recognise that Pakistan needs more trade and not just aid”, the ambassador said, adding however, it is now for Pakistan to show that it can meet the conditions for these important trade preferences, in particular by respecting human rights, labour rights, environmental standards and good governance.

“We stand ready to work with Pakistan in all of these areas,” said Wigemark.

Preferential package

Separately, the European Union preferential package on import of 75 items after a delay of over one-and-a-half years will come into effect from today.

The one time preferential package will help to increase exports up to a maximum of $537.099 million in case of full utilisation of the available quotas as against the earlier estimated $900 million, reflecting that the restrictions has significantly reduced effectiveness of the scheme for Pakistan.

The scheme was originally meant to be implemented from January 2011. The EU had announced the preferential package to help Pakistan recover from the devastated floods in 2010, but Brussels amended the original scheme to please the textile producing countries in EU.

Secretary Commerce Muneer Qureshi told Dawn yesterday that finally the scheme will be effective from November 1. He said the scheme will help to increase export of the identified products.



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