- It will provide opportunities for both EU and Pakistani businesses for bilateral trade enhancement
Islamabad: The delegation of the European Union (EU) to Pakistan is launching the first-ever EU-Pakistan Business Forum on September 8, 2021 in Islamabad to provide opportunities for both the EU and Pakistani businesses for bilateral trade enhancement.
The inauguration ceremony of the EU-Pakistan Business Forum for Small and Medium Enterprises (SME) is expected to be attended by the representatives of local SMEs from four key sectors including gems, jewelry and mining, Information Technology, handicrafts and fashion-wear as well as travel and tourism.
During the first Islamabad session, the participants will be informed about EU's GSP Plus scheme and the ways to benefit from the scheme. GSP Plus provides two-thirds of tariff lines duty free access to the EU market with the rest on preferential duties. In subsequent meetings of the EU-Pakistan Business Forum later this year, more sectors including the agricultural and auto-parts manufacturers will also be included.
Ambassador of the EU to Pakistan Androulla Kaminara said, “We are confident that the business community – especially the small and medium enterprises will take full benefit from the upcoming EU-Pakistan Business Forum and establish the right linkages to expand their trade in the EU market while the EU granted GSP+ concessions are in place.”
Pakistan will continue to enjoy GSP Plus status till 2022, after which the EU will announce new criterion to qualify for the scheme. The EU has raised issues like human rights, death penalty, restrictions on media etc.
The EU is Pakistan’s second most important trading partner, accounting for 14.3% of Pakistan’s total trade in 2020 and absorbing 28% of Pakistan’s total exports.
In 2020, Pakistan was the EU’s 42nd largest trading partner in goods accounting for 0.3% of EU trade. Pakistani exports to the EU are dominated by textiles and clothing, accounting for 75.2% of Pakistan’s total exports to the EU in 2020.
Pakistan’s imports from the EU mainly comprise of machinery and transport equipment (33.5% in 2020) as well as chemicals (22.2% in 2020).
From 2010 to 2020, EU27 imports from Pakistan have almost doubled from €3072 to €5537 million. The growth of imports from Pakistan has been particularly fast since the award of GSP+ (€5 515 million in 2014).
The EU and Pakistan have set up a Sub-Group on Trade to promote the development of two-way trade. The Sub-Group on Trade - set up under the auspices of the EU-Pakistan Joint Commission - is the forum for discussions on trade policy developments more broadly and also aims to tackle individual market access issues which hamper trade between the two parties.
Textiles and clothing account for over 80% of Pakistan’s exports to the EU. While the textiles and clothing industry are the backbone of Pakistani exports, relying so heavily on one product category carries risks for Pakistan. Trade diversification would play an essential role in this respect. The granting of GSP+ preferences in 2014 should stimulate Pakistan’s efforts towards diversification.
Copyright Business Recorder, 2021