BRUSSELS: A European Union plan to grant trade concessions to Pakistan suffered a setback this week after a number of non-EU countries complained it would hurt their economies, according to diplomats and officials.
A World Trade Organization committee in Geneva delayed for two months a vote that had been scheduled for Monday on allowing the EU to waive duties temporarily on some Pakistani imports to help it recover from last summer's floods, the diplomats said.
"Discussions are ongoing, but the decision to delay the vote does not bode well for the success of the waiver," one diplomat told Reuters.
It was not immediately clear which countries oppose the measures, which would apply to 75 goods, from cotton sheets to textiles and ethanol, and which the EU has estimated could boost Pakistani sales by 100 million euros. There was no immediate comment from the European Commission. The proposed duty suspensions affect sectors with stiff competition between Pakistan and exporters including India, Bangladesh, Sri Lanka and several Latin American countries.
Indian Trade Minister Anand Sharma suggested in December that the EU should make direct aid payments to Pakistan rather than tariff cuts, but the European Commission favours trade breaks over aid handouts.
DIFFICULTIES OF A WTO WAIVER
The EU's plan, known as a unilateral waiver, needs WTO approval and depends on unanimous backing from the trade body's 153 members.
A decision to award Pakistan trade breaks via a waiver - prompted by opposition to more direct concessions by EU states with powerful textile sectors such as Italy, Spain and France - raised concerns the plan could be rejected at the WTO.
Most of the trade concessions would be on textile products, though EU industry opposition stripped out tariff cuts for bed linen, Pakistan's main export product, imposed caps on export growth and limited the concessions to three years at most. The EU is drafting separate plans that could allow Pakistan access to long-term trade discounts from 2014 under the "GSP Plus" regime of preferential market access, though that also faces opposition within the bloc.
Comments
Comments are closed.