Mohsin Aziz acknowledged the efforts of the federal commerce minister Makhdoom Amin Fahim and commerce secretary Zafar Mahmood for successfully pleading Pakistan’s case with the European Union.
The Chairman also appreciated the decisiveness of the President European Commission, President European Council and EU Parliament in taking up this matter and according approval to the draft legislation. The passage of the draft act in EU would pave the way for the concessionary mechanism to come into force from 2014.
The scheme will replace the current GSP scheme from January 2014, under which some of the existing criteria for GSP Plus beneficiaries have also been changed. This will make Pakistan and a few other countries eligible to apply for GSP Plus, provided they fulfill the other criteria such as the commitment to effectively implement 27 international conventions relating to good governance, human rights and sustainable development etc.
Mohsin Aziz urged the concerned Ministries to complete the groundwork for ensuring that compliance formalities with regard to the adoption and ratification of the prescribed convention are completed in time. In case Pakistan is able to meet all the criteria for GSP Plus, its exports to the EU under the concessionary tariff lines will receive duty free treatment from 2014 onwards.
Mohsin Aziz conveyed relief over the fact that textile exports from Pakistan will not be affected by the planned removal of tariff preferences as only EU imports from countries where per capita income has exceeded $US 4,000 for four years have been focused at that would possibly hurt countries like Brazil, Argentina, Russia and Saudi Arabia.
The Chairman said that the formal loss of GSP status for Mexico, South Africa, Turkey, Chile, Algeria, Colombia and Peru is not of any consequence as these countries already have good market access through free trade and other preferential deals. The update will reduce the number of countries that enjoy preferential access to EU markets from 176 to around 75. Mohsin Aziz said that it was specially encouraging that the EU Parliament has made the system somewhat meaningful for the countries that remain in it including Pakistan.
Pakistan has been facilitated to apply for zero EU duties on its exports to the EU under the GSP+ incentive scheme. To now qualify Pakistan’s threshold level of exports has been raised from less than 1% to less than 2% of the EU's total GSP imports. The Chairman highlighted that Pakistan’sshare in the total EU imports is 0.3%. Mohsin Aziz expressed satisfaction that Pakistan substantially subscribes to the prescribed 27 international conventions in the field of human rights and sustainable development and hoped Pakistan textile industry will fully benefit from the opportunity of better market access to the EU.
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