Commerce Minister Jam Kamal Khan met with EU Special Representative for Human Rights Ambassador Olaf Skoog to discuss Pakistan’s trade relations with the European Union. The meeting focused on ensuring Pakistan’s compliance with international conventions under the Generalized Scheme of Preferences Plus (GSP+), a program that allows Pakistani exports to enter EU markets with reduced or no tariffs.
Pakistan’s Commitment to GSP+ Requirements
The EU’s GSP+ program provides economic benefits to Pakistan in exchange for adherence to 27 international conventions. These agreements cover governance, labor rights, human rights, and environmental protections. During the meeting, Jam Kamal reaffirmed Pakistan’s commitment to these standards.
Both parties discussed ways to expand trade and commercial cooperation between Pakistan and EU member states. Officials emphasized the importance of these agreements for economic stability and the growth of Pakistani businesses.
Impact of US Aid Cuts on Pakistan
The meeting comes as Pakistan faces new economic challenges due to recent policy shifts in the United States. President Donald Trump has frozen all USAID funding, impacting projects related to human rights, governance, and democracy in Pakistan. These initiatives align with the EU’s trade conditions, making compliance more difficult for Islamabad.
Without US financial assistance, Pakistan’s ability to meet these requirements may face hurdles. Analysts believe the country must find alternative funding sources to ensure continued trade benefits from the EU.
Decline in Pakistani Exports to the EU
Despite Pakistan’s GSP+ status, export figures have shown a decline. Data reveals that in 2023, Pakistan’s exports to the EU fell by three percent, reaching $8.240 billion.
The EU remains one of Pakistan’s largest trading partners, accounting for 30 percent of total exports. This economic reliance makes GSP+ status crucial for sustaining export-driven industries, especially textiles and agriculture.
Uncertainty Over GSP+ Status Beyond 2027
Pakistan’s GSP+ status was extended in 2023, allowing the country to enjoy trade benefits until 2027. However, some analysts question whether the EU will renew these concessions in the future.
During the meeting, Jam Kamal assured EU officials of Pakistan’s commitment to the Treaty Implementation Cell, which oversees compliance with GSP+ requirements. He emphasized that these economic incentives are essential for the country’s stability.
Future Trade Prospects with the EU
Pakistan seeks deeper economic ties with the EU, despite existing challenges. Strengthening diplomatic engagement and ensuring compliance with trade conditions will be necessary to maintain preferential access to European markets.
The commerce ministry remains optimistic about expanding trade relations, but questions remain about how Pakistan will navigate rising economic pressures and shifting global alliances.
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