EU signs trade-breaks for Pakistan

[Nahraf]

EU likely to offer trade-linked aid to Pakistan
Sunday, September 12, 2010 7:49:12 AM by ANI

Brussels, Sept 12 (ANI): Diplomatic sources have said that Europe is likely to offer trade-linked aid to Pakistan in the wake of the devastation caused by floods and rising terrorism in the country at an EU summit next week.

Hosting a two-day informal parley of foreign ministers from the 27-nation bloc, High Representative of the European Union, Catherine Ashton, said that Pakistan needed support ranging through aid, institution-building, anti-terror assistance, reconstruction and trade, the Dawn reports.

“It is in the vital strategic interest of the European Union to help Pakistan in the long term with trade,” British Foreign Secretary William Hague said.

“If we want to stabilise Pakistan, so that it doesn’t degenerate into extremism and fundamentalism, we have to address the economic consequences of this natural catastrophe,” said German Foreign Minister Guido Westerwelle.

EU leaders would have three choices to ease Pakistani goods into Europe -offering duty-free access on some goods, deciding a unilateral waiver with WTO agreement, or lowering Most Favoured Nation tariff on some products.

According to an EU source, the list of product areas qualifying for exemptions was drawn up, aiming to provide about 25 million euros of annual benefits to Pakistan.

However, a European association of textile producers (Euratex) resisted to the idea of preferential treatment to Pakistan.

The “Pakistani government is (repeatedly) using all sorts of excuses to demand free access to the EU market,” citing the “fight against terrorism, economic crisis and now the floods,” Euratex told EU trade commissioner Karel De Gucht last week.

It pointed out that Pakistan was “already a major world player” on par with India or China, and warned that unilateral EU moves “will certainly be attacked” in the WTO and could “seriously jeopardise” negotiations on a free-trade deal with New Delhi. (ANI)

 

[Aeon]

However, a European association of textile producers (Euratex) resisted to the idea of preferential treatment to Pakistan.

The “Pakistani government is (repeatedly) using all sorts of excuses to demand free access to the EU market,” citing the “fight against terrorism, economic crisis and now the floods,” Euratex told EU trade commissioner Karel De Gucht last week.

It pointed out that Pakistan was “already a major world player” on par with India or China, and warned that unilateral EU moves “will certainly be attacked” in the WTO and could “seriously jeopardise” negotiations on a free-trade deal with New Delhi. (ANI)

That's funny. They conveniently don't seem to share much of the "failed state" or "failing state" rhetoric then?

 

[muse]

It's an oversight - it will be corrected shortly

 

[Ras]

Will not happen as it will run afoul of the WTO which mandates a level playing field.

 

[AZADPAKISTAN2009]

well even if trade is allowed at moment all our crops are washed out and our industry is also sagging will take 2 years for production levels to reach levels to export items out

 

[xenia]

EU is planning to open market for pakistan but ll be following the MFN clause as well..that means markets ll automatically open for bangladesh n india..although it ll benefit pakistan but we ll not be the sole reapers of this benefit..besides there is enough condemnation by southern europe states who also compete for this textile market n lastly this "opening up" is for a list of items...just 13 i guess!!

 

[TopCat]

The Pakistani government is (repeatedly) using all sorts of excuses to demand free access to the EU market,” citing the “fight against terrorism, economic crisis and now the floods,Euratex told EU trade commissioner Karel De Gucht last week.

It pointed out that Pakistan was “already a major world player” on par with India or China, and warned that unilateral EU moves “will certainly be attacked” in the WTO and could “seriously jeopardise” negotiations on a free-trade deal with New Delhi. (ANI)

This is disgracefull. Pakistan should team up with other countries of similar economic level to get the preferences out of EU. Nobody is going to treat Pakistan as VIP.

 

[Nahraf]

Sri Lankan was given “GSP-plus” trade benefits by EU few years ago. These benefits were withdrawn by Aug. 15, 2010. Pakistan may also be offered “GSP-plus” trade benefits by EU.

 

[AnGrz_Z_K_Jailer]

well even if trade is allowed at moment all our crops are washed out and our industry is also sagging will take 2 years for production levels to reach levels to export items out

^^^ Azad Bhaiya not only you're allow to export the good but at the same time EU will invest to build your economy .. it's really a very nice opportunity to put economy back on track .. InshAllah ..

Bas dua karen key yeh pagal logh (taliban) ju badh amini purey mulk mein pehla rahey wo Qatam hojaey ..

regards
Jailer

 

[Nahraf]

AFP: EU agrees trade-linked aid package for Pakistan

EU agrees trade-linked aid package for Pakistan

(AFP) – 3 hours ago

BRUSSELS — European nations struck a deal on Thursday to ease barriers to Pakistani traders in a bid to help the flood-ravaged country.

Foreign ministers agreed to offer "ambitious trade measures" in moves designed to help Islamabad battle Islamist extremism.

The details, a source said during summit talks in Brussels, would be worked out next month when the European Commission would come up with proposals on individual tariffs.

British Prime Minister David Cameron led calls for EU partners to offer "ambitious trade measures essential for economic recovery and growth" and left satisfied at having secured a political commitment.

The stance came as the head of the United Nations refugee agency urged the world to do far more to help Pakistan recover from catastrophic floods that have left 10 million people without shelter.

The UN is to launch a new appeal for hundreds of millions of dollars in New York on Friday.

"The severity of this crisis demands an immediate and substantial response, taking also into account the strategic importance of Pakistan?s development, security and stability in the region," the EU said in its end-of-summit declaration.

Leaders of all 27 EU nations endorsed the "firm commitment to grant exclusively to Pakistan increased market access to the EU through the immediate and time-limited reduction of duties on key imports from Pakistan in conformity with WTO rules."

They also agreed to promote Pakistan's case to be granted special favours by the World Trade Organization, "provided it meets the necessary criteria" and following consultations with regional or sector rivals elsewhere such as India.

German Foreign Minister Guido Westerwelle said last week that the move was designed to prevent Pakistan from degenerating into "extremism and fundamentalism."

The commission, which polices EU trade matters, suggested last week that ministers consider ditching tariff barriers on 13 types of textile product, in an effort to kick-start an economic fightback.

Those plans were not immediately backed by trade ministers.

The idea of preferential treatment also caused consternation within the industry.

Copyright © 2010 AFP. All rights reserved

 

[Nahraf]

EU Cuts Tariffs to Aid Pakistan - WSJ.com

EU Cuts Tariffs to Aid Pakistan
By JOHN W. MILLER

BRUSSELS—European Union governments agreed to suspend some tariffs on imports from Pakistan in an effort to help it recover from this summer's brutal flooding.

The cuts, however, will be less than hoped for by many activists, EU officials said, a sign that the recession is limiting what rich countries are willing to do to help those in need. Donor countries are meeting Sunday in New York to discuss ways of raising more money for reconstruction in Pakistan.

U.S. special envoy to Pakistan and Afghanistan Richard Holbrooke said Thursday that the world will be able to fund only a quarter of the tens of billons of dollars needed to rebuild Pakistan, according to the Associated Press.

Pakistan sustained economic damage of around $15 billion, roughly 10% of its gross domestic product. Flood-relief aid committed to Pakistan so far amounts to $1.1 billion. Pakistan will have to pay for much of the reconstruction, especially by improving its meager tax-collection record, Mr. Holbrooke said. "I don't want to withhold money they need, but I think we have to be clear that the Congress is going to be reluctant to give money if the money is filling in a gap because people are not paying taxes," he said.

With aid budgets limited, diplomats have turned to trade, where Pakistan has ample room to grow. With 170 million people, Pakistan is the sixth most populous nation on earth. Yet its exports totaled only $13.1 billion last year, roughly the same as Ecuador, population 13.4 million. The EU imported only $4.6 billion in goods from Pakistan last year, ranking Pakistan 46th among all of the EU's trading partners. Pakistani exports to the U.S. amounted to $3.2 billion.

Pakistani textile firms, under pressure from Chinese competition, have taken the lead in lobbying for better market access in the U.S. and EU. They are finding some allies. The U.S. Chamber of Commerce wrote to Secretary of State Hillary Clinton and U.S. Trade Representative Ron Kirk last month to advise tariff cuts.

The U.S., which has donated more to the Pakistan relief efforts than any other country, has so far declined to offer tariff cuts due to pressure from American textile producers.

On Thursday, EU leaders offered a tangible concession, a "The European Council underlines its firm commitment to grant exclusively to Pakistan increased market access to the EU through the immediate and time-limited reduction of duties on key imports." Pakistan will also be allowed to join a low-tariff scheme known as GSP-plus by 2014.

EU Trade Commissioner Karel De Gucht will administer the specific cuts. In the end, the cuts will be about $400 million a year, EU officials said.

The officials expect the commissioner to limit the cuts to around that amount to protect manufacturers in textile-producing nations such as Italy, Spain and France, which say they fear being drowned out by Pakistani imports. There are also some reservations in the EU's trade office that Pakistan might take away too much market share from other "vulnerable" countries, such as Tunisia, Turkey and Mexico, an EU official said.

Aid agencies praised the move. "Europe today stood out from the crowd and showed the political resolve that is needed when major humanitarian emergencies emerge, like the one currently affecting over 20 million people in Pakistan," said Elise Ford, head of Oxfam's Brussels office.

Pakistani officials also lauded the plan. A similar plan had been enacted for a few years after the Sept. 11, 2001 attacks in the U.S.

"Preferential access for Pakistani textiles in the EU market would strengthen Pakistan's hands in fighting terrorists by creating jobs and prosperity," said Farahnaz Ispahani, a spokesman for President Asif Ali Zardari. "President Zardari has consistently argued that enabling Pakistan to realize its full economic potential will lead to our expanding trade and eliminating need for aid."
—Tom Wright
contributed to this article.

 

[Kompromat]

EU grants Pakistan trade breaks
Published: September 17, 2010

BRUSSELS (Agencies) - European Union leaders agreed on Thursday to grant limited trade concessions to Pakistan to help it overcome the impact of devastating floods and maintain political stability.
Pakistan will receive an ‘immediate and time-limited reduction’ in duties on key exports to the European Union, taking into account industrial sensitivities in the EU, notably on textiles, they said.
One diplomat said the arrangement would be worth around 300 million euros ($390m) to Pakistan over a year.

The details will be worked out by the European Commission, the EU executive, in coordination with the World Trade Organisation to avoid the concessions violating international trade rules and aggravating other EU partners such as India, Sri Lanka and Bangladesh.
The European Union has agreed to temporarily waive World Trade Organization tariffs on key Pakistani imports to help boost the flood-devastated country’s economy, British Prime Minister David Cameron said Thursday.

“There is a humanitarian crisis in Pakistan, there are also clear and very worrying concerns about what can happen in Pakistan with all that is going on, and all the dangers that everyone is aware of,” Cameron said.

“I believe this was a test for the European Union to make sure that when we talk about our external relations we can show we can deliver results and not just rhetoric,” Cameron told reporters.
The EU also agreed to look at granting Pakistan a favoured trading status with the EU after 2014, Cameron said.

“There is a deal done,” the diplomat said, adding that it included a commitment to grant Pakistan access to the EU’s enhanced trade programme, known as GSP+, by 2014, provided it meets criteria on good governance and human rights.

The block’s executive, the European Commission, has ‘reached an agreement on a proposal for 13 tariff lines’ which could have their tariffs temporarily suspended, Trade Commissioner Karel De Gucht told journalists after talks with EU trade ministers. That is allowed under WTO rules. The exact tariff lines under debate are currently a carefully guarded secret.

“The European Council underlines its firm commitment to grant exclusively to Pakistan increased market access to the EU through the immediate and time-limited reduction of duties on key imports,” a statement by the 27 EU leaders said.
“The European Commission is invited to explore options with WTO partners and present finalised proposals in October, taking into account industrial sensitivities in the EU.”

The European Union has been pressing for weeks to try to agree better trade terms for Pakistan to help it overcome the impact of the floods, over and above the emergency food and other aid it has already sent to the country.

Britain and Germany had pushed hard for a deal, but France, Italy and others EU states with domestic industries that compete with Pakistani imports such as linen, garments and ethanol, were reluctant to give too much ground at a time of economic stress.

The deal would result in a trade ‘waiver’ for Pakistan, similar to the one Islamabad received after the Sept 11, 2001 attacks on the United States in recognition of its role as a frontline ally in the battle against militants.

The discussion was complicated by trade rules and the possibility that tariff reductions granted to Pakistan could benefit China and India. “We want to help Pakistan - but only Pakistan,” said one Italian diplomat.

The EU is hoping that by discussing concessions with the WTO and trade partners ahead of time, it will prevent countries such as India filing lawsuits with the WTO against the move.

Since trade disputes take a long time to be settled, time-limited concessions should deter opponents from making legal challenges.
“If you want to stabilise Pakistan in the long run so that it does not drift away to extremism or fundamentalism, you have to make sure that the medium- and long-term consequences of the catastrophe will be countered economically,” German Foreign Minister Guido Westerwelle told reporters this month.

Pakistan has long coveted GSP+ status, but does not qualify as its economy is too large, with exports to the EU worth 3.02 billion euros ($3.84 billion) in 2009, and because it has not met accompanying human rights and governance criteria.

Earlier, the European Union agreed a vast trade deal with South Korea, saying it was the first link in a process which would ‘bind’ Europe to Asia.

The deal is the first such trade pact between the 27-member EU and an Asian country, and was presented as a pace-setter for similar agreements with India and other regional powers.
Belgian Foreign Minister Steven Vanackere, whose country holds the European Union’s rotating presidency, hailed the deal as the ‘most ambitious agreement ever’ after Italy dropped its objections at an EU summit in Brussels.

The deal will be formally signed at an EU-South Korea summit in Brussels on October 6, Vanackere said. The agreement must also be ratified by the European parliament.

EU grants Pakistan trade breaks | Pakistan | News | Newspaper | Daily | English | Online

 

[Patriot]

I never thought they would but good news anyway.Let's hope exporters take full advantage of this!!

 

[xenia]

“There is a deal done,” the diplomat said, adding that it included a commitment to grant Pakistan access to the EU’s enhanced trade programme, known as GSP+, by 2014, provided it meets criteria on good governance and human rights.

this is making me suspicious..remember what EU did with our textile products some years back on baseless charges!

 

[TopCat]

this is making me suspicious..remember what EU did with our textile products some years back on baseless charges!

Can you tell us more about it? what were those charges?

Good luck pakistan on securing trade concession..