The European Union’s fourth GSP report has acknowledged Pakistan’s significant progress on the legislative front while emphasising the need for improving practical application in both “letter and spirit.”

“The GSP+ incentive has contributed positively to Pakistani society,” EU Ambassador to Pakistan Riina Kionka said in a statement on Tuesday.

Her comments were part of the statement on the European Commission and the European External Action Service (EEAS) joint report on the Generalised Scheme of Preferences (GSP).

The report assessed the progress of eight GSP+ beneficiary countries, including Pakistan, in the effective implementation of the 27 international core conventions underlying the GSP+ scheme, which is required for beneficiary countries in order to continue benefitting from such a status.

The 27 conventions cover the four areas of human rights, labour rights, environmental standards, and good governance for the period 2020 to 2022. The report highlighted areas where more progress was needed. So far, four biennial reviews have been concluded under the current GSP scheme.

EU envoy Kionka was of the view that the GSP+ has increased awareness of human rights at the grassroots level, of labour rights within businesses and export supply chains and of the significance of environmental considerations and good governance.

“However, the full potential of the GSP+ benefit can only be realised by diversifying Pakistan’s exports to include more value-added products,” she said.

Like in other GSP+ beneficiary countries, Pakistani authorities at various levels have contributed through dialogue. Furthermore, civil society, trade unions, business organisations and international organisations, contributed by providing information and specific findings during the last monitoring period, in particular during the most recent Monitoring Mission of June 2022.

Pakistan was awarded GSP+ status on 1st January 2014 after the country had ratified 27 international conventions and committed to implement them.

The EU GSP+ serves as a special incentive arrangement to promote good governance and sustainable development by facilitating trade. “The incentive grants Pakistan zero-rated or preferential tariffs on nearly 66% of tariff lines, enhancing the country’s ability to export to the EU market.”

From 2014 to 2022, Pakistan’s exports to the EU increased by 108% whereas imports from the EU increased by 65% and the total trade volume increased from €8.3 billion in 2013 to €14.85 billion. Pakistan’s garments, bedlinen, terry towels, hosiery, leather, sports and surgical goods and similar products enter the EU market availing the GSP+ concessions.

Last month, caretaker Commerce Minister Gohar Ejaz announced that the members of the European Parliament of the European Union have decided to roll over the rules on the GSP+.

“The European Council is expected to give its final approval for the extension of the current scheme soon,” Gohar Ejaz said in a post on X, erstwhile Twitter, on October 5, 2023.