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EU grants GSP plus status to Pakistan

Discussion in 'Pakistan Economy' started by Rahil khan, Dec 13, 2013.

  1. Rahil khan

    Rahil khan FULL MEMBER

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    Friday, December 13, 2013 - Islamabad—Pakistan gained a big breakthrough in Brussels on Thursday as European Union granted Generalised System of Preferences Plus (GSP Plus) status allowing duty free access of Pak products, particularly textile to 27 countries.

    In a meeting of European Union Parliament, Pakistan got the concession with 406 members in favour against 162 negative votes.

    The European Parliament approved the Single Delegated Act under which ten countries including Pakistan are entitled to GSP Plus Scheme. The Act will come into force from 1st January, 2014.

    Prime Minister Nawaz Sharif had given special task to Governor Punjab Chaudhry Sarwar to work with the EU members for this momentous achievement.

    According to experts in trading sector, Pakistan can boost exports to over $ 1 billion dollar in one year and this momentum will continue enabling the country to boost exports to $ 4 to 5 billion which will result in increased economic activities generating employment for tens of thousands jobless persons.

    A press release of Foreign Office said Pakistan embassies in the European capitals, the Ministry of Commerce and Governor Punjab have worked incessantly to bring about the passage of the Act.

    “We are grateful to the European Commission and member countries of the European Union for their unstinting support at every step of the process and to the European Parliament for the adoption of the Single Delegated Act. The EU initiative to grant GSP Plus will supplement the Government’s efforts to revive economy. It is our expectation that with the implementation of the Single Delegated Act, Pakistan’s trade with EU will receive a substantial boost, particularly in the textile sector. It will also help generate a lot of economic activity, create more employment opportunities and improve security situation in Pakistan,” the release said.

    Congratulating the nation on this achievement, President Mamnoon Hussain said that EU’s Generalized System of Preferences Plus (GSP Plus) Scheme would not only further strengthen our trade relations with the member countries of the European Union but would also significantly help strengthening our economy through greater trade, generation of economic opportunities and creation of more jobs for our people.

    He appreciated the efforts of all those who worked hard for passage of this Act.

    The President also acknowledged and appreciated European Commission and the member countries of European Union for their continued support to the country for getting GSP Plus status.

    The President expressed the hope that our economy and the business community would take full advantage of the facility to secure greater place for Pakistani products in the European markets.

    Prime Minister Nawaz Sharif said “award of GSP+ status shows confidence of the international markets on the excellent quality of Pakistani products.”

    He further said, “gaining access to European markets was the top most priority of the government as part of the economic development agenda, which has been achieved due to continuous and hard work of the Ministers and Officials of the Ministries of Finance, Commerce and Foreign Affairs and friends of Pakistan in Europe”.

    This status would enable Pakistan to export more than US $ 1 Billion worth of products to the international markets. Only the textile industry would earn profits of billions of rupees per year.

    Prime Minister also added that increase in exports would resultantly facilitate in economic growth and help in generation of millions of additional employments.



    He further stressed upon exporters to invest in the entire value chain, and improve the quality and marketability of Pakistani products through research and innovation, product diversification and brand development.

    Pakistan on Thursday succeeded to secure the long awaited duty-free access to the European markets for four years, by winning Generalised Scheme of Preferences (GSP) Plus status with an impressive count of votes.
    According to sources, 406 members of the European Parliament expressed their support for Pakistan while 186 lawmakers voted against the status at a session held in Brussels. The European Parliament approved the Single Delegated Act under which 10 countries including Pakistan are entitled to Generalised System of Preferences Plus (GSP Plus) Scheme. The Act will come into force from January 1, 2014.
    The GSP Plus status will allow almost 20 per cent of Pakistani exports to enter the EU market at zero tariff and 70 per cent at preferential rates for four years till 2017. Experts said that under the scheme, Pakistan can export most of its textile products to 27 EU nations at concessionary duty rates or absolutely duty free, making Pakistani products cheaper for European importers.
    As per industry sources, tariff lines covered under GSP plus are almost 6,000 which is 91% of total tariff lines. It is expected that Pakistan will be allowed to get benefit on almost 2,500 tariff lines out of which around 900 belong to the textile sector. Previously, under GSP Plus status many different products like surgical instruments, sports goods, ethanol, PET, plastics and textile products were being exported to EU. However, in Pakistan’s case, major charm lies in textile sector. Pakistan’s textile and clothing exports to the EU currently constitute over half of the country’s total exports to the bloc worth $9.5 billion.
    They said that as a result of the GSP Plus, the textile industry alone is expected to earn profits up to one trillion rupees per year. Textile exports had been declining in Pakistan, as manufacturers and exporters were finding it hard to compete with Sri Lanka and Bangladesh who already had duty-free access to European markets. This special status will provide Pakistan duty free or preferential duty rate access on 3,500 products to EU markets where currently Pak textile exports to the EU draw an 11% duty.
    The GSP Plus is granted to those countries that ratify and implement international conventions relating to human and labour rights, environment and good governance. The EU has been closely watching Pakistan’s human rights record and also fiercely opposes the death penalty.
    Punjab Governor Chaudhry Sarwar, who is in Brussels for lobbying on this move, termed GSP status as historic achievement as it would help to boost economy of the country. Addressing telephonically to the Pakistan business community, Ch Sarwar said it would provide employment opportunities to about one million people of the country. He said Pakistan can now export textile goods to European member countries till 2017 without having to pay duties, adding that it would increase exports worth $1 billion.
    Foreign Office also confirmed that European Parliament approved the Single Delegated Act under which 10 countries including Pakistan are entitled to GSP Plus Scheme. Foreign Office Spokesperson in a statement that our embassies in the European capitals, the Ministry of Commerce and Punjab governor have worked incessantly to bring about the passage of the Act. “We are grateful to the European Commission and member countries of the European Union for their unstinting support at every step of the process and to the European Parliament for the adoption of the Single Delegated Act,” the Foreign Office added.
    “Award of GSP-Plus status shows confidence of the international markets in the excellent quality of Pakistani products,” Prime Minister Nawaz Sharif said in a statement. Gaining access to European markets was the top priority of his government as part of an economic development agenda, he said. The status will enable Pakistan to export products worth over $1 billion to international markets and the textile industry alone is expected to earn profits of more than Rs1 trillion a year, the spokesman said.
    President Mamnoon Hussain said that EU’s GSP Plus Scheme would not only further strengthen our trade relations with the member countries of the European Union but would also help strengthening our economy through greater trade. Addressing the concluding session of 3-day 16th Sustainable Development Policy Institute Conference, Finance Minister Ishaq Dar said the EU has granted status to Pakistan which would greatly help the country to boost its export.
    Pakistan secures GSP Plus status
     
    Last edited: Dec 13, 2013