The European Commission has proposed extending Pakistan’s GSP+ status for another four years as a contingency measure. The status, which was set to expire at the end of this year, means no change for Pakistan at the moment.

But then what does it mean? European Union Ambassador to Pakistan Riina Kionka explained this in a video on Sunday.

“The proposed extension of the EU’s global GSP regulation means that, for now, nothing changes. Pakistan will continue to benefit from the preferential access to the European Market,” she said.

The GSP+, which stands for Generalised Scheme of Preferences Plus, gives developing countries an incentive to pursue sustainable development and good governance. Eligible countries have to implement 27 international conventions on human rights, labour rights, the environment, and good governance.

As a result, the bloc cuts its import duties to zero on over two-thirds of the tariff lines of their exports.

There are seven beneficiaries of the scheme: Bolivia, Cape Verde, Kyrgyzstan, Mongolia, Pakistan, Philippines, and Sri Lanka. The proposed extension applies to all of them.

The EU envoy went on to add that the bloc would continue to monitor progress in backsliding and representatives would continue to report to the European Parliament and the member states about it.

“The main issue here is to avoid a kind of cluster at the end of the year that nobody wants that happen certainly, not the European Union because it would mean a sudden stop to the trade presences, which would affect Pakistani exporters. It would affect certainly factory workers and their families,” she said and added that it would have a toll on the European businesses and consumers that rely on Pakistani suppliers.

Pakistan has had GSP+ status since January 2014. With a per-capita income of $1,505 (2021), Pakistan is considered a lower-middle-income economy.

Total EU imports from Pakistan amounted to €6.6 billion in 2021, of which €4.7 billion were imported benefiting from GSP+ tariffs. This makes Pakistan the largest beneficiary among all GSP+ beneficiary countries.

Kionka highlighted that the latest report on the GSP+ Monitoring Mission, which came last summer, was going to come out soon. She avoided prejudicing any thoughts. But from earlier missions that earlier monitored, the envoy advised that there were certain areas where the EU would like to see more improvement for instance: freedom of expression, freedom of the media, and freedom for gender belief.

“The situation of minorities, rights of women, and gender equality and also on labour rights in terms of strengthening labour inspection,” she said.