ISLAMAABD: The United Kingdom (UK) has unveiled a new initiative called the Developing Countries Trading Scheme (DCTS) in place of Generalised Scheme of Preference (GSP).
DCTS aims to provide Pakistan and 64 other countries with improved trade opportunities through tariff reductions and simplified terms of trade. The scheme officially replaced the UK’s Generalised Scheme of Preference (GSP) on June 19, 2023.
“Pakistan will enjoy one of the most generous sets of trading preferences offered by any nation in the world,” said Syed Naveed Qamar Commerce Minister while announcing the launch of the DCTS.
Pakistan and the European Union (EU) will reportedly hold Pak-EU Joint Commission meeting in Brussels (Belgium) on 23 June, 2023, which will cover trade, political, regional issues, readmission/ return of Pakistanis entering into Europe illegally, aviation and other matters.
According to the Minister, current bilateral trade between Pakistan and the UK stands at a substantial $4.4 billion, and with the implementation of the DCTS, both nations anticipate a significant boost in trade volume and economic cooperation.
It is projected that Pakistan will save approximately $120 million in export tariffs under the DCTS, which will facilitate a greater competitiveness for Pakistani exporters in the UK market.
The Government views the development as a positive step towards strengthening the economic partnership between the two countries.
Syed Naveed Qamar said under the DCTS, an impressive 94% of goods exported from Pakistan will be eligible for duty-free access to the UK.
This measure is expected to encourage the expansion of various sectors within the Pakistani economy including textiles, agriculture, and manufacturing, Qamar remarked.
Commerce Ministry maintains that the Minister acknowledged that Pakistan’s “Enhanced Preferences” status has been retained, providing the country with added advantages in terms of trade incentives and market access.
This recognition reinforces the commitment of the UK to foster trade relationships with developing countries like Pakistan.
Minister expressed confidence that the tariff reductions and simplified trade terms introduced by the initiative will encourage increased bilateral trade, leading to enhanced prosperity and development for Pakistan.
With the DCTS coming into effect, Pakistani exporters and business communities are eagerly anticipating the opportunities it will unlock.
This initiative is expected to deepen the historic ties between the UK and Pakistan, and pave the way for a more prosperous future characterized by robust trade relations and shared economic growth.
As the DCTS comes into effect, the Ministry of Commerce will work closely with relevant stakeholders to ensure that Pakistani exporters are aware of the scheme’s benefits and can capitalize on the new opportunities it presents.
Pakistan as one of the countries benefiting from the DCTS, is well-positioned to leverage this opportunity for its economic growth.
With increased access to the UK market, Pakistani businesses can expand their exports, tap into new consumer bases, and diversify their product offerings.
The Ministry will provide guidance and support to facilitate the seamless integration of Pakistani businesses into the UK market, further enhancing bilateral trade relations. According to the United Nations COMTRADE database on international trade, European Union imports from Pakistan were $9.94 billion during 2022, European Union Imports from Pakistan - data, historical chart and statistics - was last updated this month - June of 2023.
The new proposed scheme aims to improve key features of the scheme to better respond to the evolving needs and challenges of GSP countries, as well as reinforce the scheme’s social, labour, environmental and climate dimension. It will be in place for ten years. There is an expansion in the list of International Conventions from 27 to 32 that beneficiary countries will have to ratify and implement.
Copyright Business Recorder, 2023