First few months into the year 2022, we found ourselves conceding with the demands of IMF. By opening doors to inflation and poverty we managed to reach staff-level agreement with IMF. While, we still have to cover a long way to get the loan from the international body, another supranational body is at our door steps to decide the fate of Pakistan. Everyone is desperately waiting to know will Pakistan be able to become a part of EU regime?
EU officials have arrived in Pakistan to decide whether to extend GSP+ status to the country or not. GSP+ is a policy established in 1971. It provides zero tax on some export duties. This leverage is provided to the developing countries to help them overcome poverty. EU also aims at supporting the developing countries attain sustainable development.
This status however, comes with some conditions. A country is eligible for the GSP+ status if it implements all the 27 international conventions related to good governance, labor rights, climate change, and environmental protection.
The preferential access to the EU market has helped the developing countries for five decades to achieve sustainability by helping them diversify their economy and produce employment opportunities. Moreover, this policy enables the countries improve their human rights and climate change situations.
According to Josep Borrell Fontelles, Vice President “The GSP scheme is all about the EU’s and Pakistan’s joint commitment to sustainable development.”
Since 2014, the year Pakistan joined GSP+ regime, the country’s exports to the EU market have soared to 65%. It is important to note here, EU market is important for Pakistan’s export. Other countries that enjoy the tariff concessions under GSP+ are Sri Lanka, Mongolia, Bolivia, Kyrgyzstan, Uzbekistan, Philippines, Cabo Verde, and Bolivia.
As the existing GSP framework will end in December 2023 and the future 2024-2033 framework is in drafting stage, EU is revisiting the GSP+ status of Pakistan to decide whether the country would be included in the upcoming regime or not.
Where IMF conditions are burdening the citizens of Pakistan, the EU demands are aim improving the internal conditions of the country.
Let’s see how things pan out for Pakistan.