10-year GSP+ scheme: EU includes 5 new global conventions as eligibility criteria

ISLAMABAD: The European Union (EU) has included five new international conventions as eligibility criteria for the new 10-year (2024-34) General System of Preference (GSP) Plus scheme.

This was revealed by Ministry of Commerce (MoC) before Senate Standing Committee on Commerce, headed by Senator Zeeshan Khanzada. The Committee, briefly discussed GSP plus related issues before the lack of quorum.

The EU Commission adopted the legislative proposal for new GSP scheme on September 22, 2021. Once adopted by the EU Parliament, all beneficiary countries including Pakistan will have to make fresh application to the EU.

According to Commerce Ministry, an inter-ministerial meeting was held on October 14, 2021 with all the relevant Federal Ministries and representatives from Provincial Governments to deliberate on status of the new Conventions and preparation of a Plan of Action for the implementation of 32 International Conventions likely to be included in the new GSAP plus scheme.

During the meeting on Thursday, Prime Minister’s Advisor on Commerce and Investment, Abdul Razak Dawood said that Commerce Ministry had held very fruitful discussions with the EU delegation during their visit to Pakistan recently.

EU extends GSP plus status with six new Conventions

“The (EU) delegation told us our weaknesses in implementation of Conventions but overall they were satisfied with the progress made so far,” he added.

Dawood maintained that he held a meeting with the EU in Karachi on November 17, 2021, wherein they expressed their satisfaction.

He said the EU authorities stated that they are giving duty free access to Pakistani products despite the fact that Pakistani societal conditions are not what the EU supports. The EU has concerns on Pakistani laws, which according to them are contrary to EU laws especially, freedom of speech, journalists’ protection, enforced disappearances and death penalty.

“There are some areas where they have concerns like hanging for certain crimes. But we also don’t want to send anybody to jail without trial,” he continued.

Razak Dawood said, the EU is now Pakistan’s biggest trading partner as Pakistan exports are $ 9 billion per annum.

Chairman Standing Committee enquired about concessions available to Pakistan under GSP plus scheme. Secretary Commerce, Sualeh Ahmad Faruqui stated that 66 per cent tariff lines are covered in GSP plus (duty free access) covering top 10 product sectors of exports to EU - all except cereals like rice whereas remain 34 per cent enjoy MFN tariffs. EU has granted unilateral concession to Pakistan and there is no reciprocal concession to EU.

According to Commerce Advisor, EU maintains that it has opened trade for Pakistan but Pakistan’s range of products is limited. He urged exporters to expand their range of products and also focus on products which are also covered under GSP plus but not being exported.

Secretary Commerce stated that Pakistan needs increase in volume and increase in value addition.

EU-Pakistan Business Forum to be launched on 8th

“If we work in volume, value addition and range, then we can get better results,” he said.

Secretary Commerce opposed a proposal of Chairman Standing Committee to invite the European Union ambassador to a meeting of Standing Committee to share EU’s viewpoint on delay in implementation of agreed actions.

“If we summon EU ambassador to the Standing Committee meeting, then the EU member countries will reciprocate this action, which will create issues,” Secretary Commerce argued.

The EU ambassador wants to interact with the Committee members directly to share the concerns of European Union and implications for future GSP plus scheme for Pakistan.

Secretary Commerce indicated that a Parliamentary delegation will be sent to Brussels, the headquarters of the EU, to interact with EU Parliamentarians when the last review of current GSP scheme will be about to be finalized.

He further stated that now Pakistan should focus on United States, EU and UK, who are major trading partners.

In reply to a question, he said, that there was no local endowment before the approval of GI law. However, after the approval of GI law, 100 percent area specific items would be covered.

Secretary said Pakistan is suffering due to sanctions on Iran. Now barter trade deal is struck between chambers of both countries, without involvement of financial transactions; he added that in one month the system will be streamlined.

He said FATF affects where trade is informal like Iran but is not concerned with formal trade with any country.

Copyright Business Recorder, 2021