Exports to EU under GSP+rise 3.3pc

Updated 29 Aug 2020

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Pakistan was able to avail tariff concessions on €5.885bn exports to  28-member union in 2018. — File
Pakistan was able to avail tariff concessions on €5.885bn exports to 28-member union in 2018. — File

ISLAMABAD: Pakistan’s exports to the European Union (EU) increased by 3.3 per cent under the generalised system of preferences plus (GSP+) scheme, a report produced by the Democracy Report International and European Commission showed on Friday.

Before the GSP+ scheme, Pakistan’s exports to 28-member union stood at €4.54 billion in 2013, which jumped to €5.51bn in 2014. In the second year of the GSP+ scheme, exports further jumped by 10pc to €6.09bn.

Since 2016, exports proceeds have stagnated at €6.30bn at 2016, €6.69bn in 2017 and €6.88bn in 2018.

Of the €6.739bn exports to the EU in 2018, Pakistan was able to avail tariff concessions on €5.885bn. From 2013 to 2019, Pakistan was able to considerably enhance its exports to the EU with an increase of 65pc.

The findings were reported by the ‘EU’s GSP+ Assessment Report 2020: How has Pakistan progressed in its compliance?’.

Growth marred by lack of action on forced labour; curbs on freedom of expression

The European Commission inked a law in 2013 allowing Pakistan the GSP+ status under which exporters will be exempted tax on certain categories of goods exported to the EU.

The preferential scheme is conditional on implementing international conventions on human and labour rights, and freedom of speech in Pakistan. The current EU report states that some provinces have demonstrated an improvement in compliance with labour conventions, yet much of the issues reported in its 2018 report not addressed by 2020.

Weak occupational safety can be attributed to weak labour inspections. Low numbers of labour inspection officers and lack of training and capacity affect law enforcement. Freedom of association and collective bargaining is an issue which the EU noted as having ‘limited progress’. This, like occupational safety, had also been mentioned in the EU’s previous report.

Pakistan ranks 8th in 167 countries by the global slavery index ranking and classified as one of the worst countries in terms of its government response. The EU report uses strong language while describing the lack of compliance with the abolition of forced labour and states that despite existing laws “the issue is that of non-implementation and is rooted in either political unwillingness or inability to implement the law.”

The EU suggests “more industrial and economic zones need to be initiated in the country to address increasing bondage labour, as the higher number industrial zones can reduce the chances of the forced labour.”

The data on female workforce participation and remuneration for Pakistan reflects a dismal situation. The 2018 Labour Force Survey shows less than 15pc participant rate of women in the labour market as compared to 46pc for men. Added to this is discrimination towards women in terms of their representation in high skilled occupations and positions of senior management.

The report praised merger of the Former Federal Administered Tribal Areas as part of the Khyber Pakhtu­nkhwa province and the extension of the High Court and the Pakistan Supreme Court, representation for former FATA residents at the federal Parliament and in the KP Assembly.

However, there is also mention that these developments have been undermined by the passage of the KP Action (in aid of civil power) Ordinance, 2019, which allows the military in the merged districts to detain without reason or the need to produce arrested individuals at a court of law, which the report recognises as ‘serious concern’.

Freedom of expression was cited as restrictive in Pakistan’s 2018 Unive­rsal Period Review, same as in 2017 report. In its report in 2020, the EU again repeats its call to improve freedom of expression, as stipulated in the International Covenant on Civil and Political Rights. Restrictions on freedom of expression only increased during the reporting period with curbs of broadcasting, self-censorship by journalists and disruption to the distribution of a national newspaper.

Published in Dawn, August 29th, 2020