KARACHI: Pakistani businesses need to prepare for new European Union (EU) trade rules that will come into effect earlier than the current extension of the Generalized System of Preferences (GSP) Plus program, the Belgian envoy said on Monday.
"Pakistan must apply for the new GSP Plus regulation, which will come into force earlier than the current extension which is up to 2027," Ambassador Charles Delogne said at a meeting with the Karachi Chamber of Commerce & Industry (KCCI). "The business community needs to make political authorities aware of this requirement to ensure a smooth transition."
The EU’s GSP Plus for Pakistan has been extended for another four years, up to 2027.Ambassador Delogne said Pakistan was making good use of the GSP Plus agreement, which has made the EU the main trade partner of the country.
"The year 2023 was the year when bilateral trade between Belgium and Pakistan remained balanced, which was very good as Belgium does not contribute to the payment crises being confronted by Pakistan," he added.
“As a small country, foreign trade is vital for Belgium. The Belgian economy survives on importing goods, transforming them by adding maximum value, and then exporting the same, which is why foreign trade and free trade are vital for Belgium.”
The envoy said that GSP+ was more than an agreement signed by the EU with those countries which were perceived as likeminded on a certain number of issues, including human rights, labor rights, and the environment, which was extremely important for a country like Pakistan that badly suffers from the negative consequences of climate change.
President KCCI Iftikhar Ahmed Sheikh said Pakistan remains committed to the complete implementation of the GSP Plus, with exports to the EU surpassing $8 billion in the fiscal year 2023, while Belgium emerged as one of the largest export destinations within the EU.
He noted that Pakistan's exports to Belgium amounted to approximately $405 million during the nine months of the current fiscal year, from July 2023 to March 2024, which fell short of expectations and need to be elevated to a satisfactory level by capitalizing on the existing opportunities for boosting trade between the two countries.
Sheikh said the government has established the Special Investment Facilitation Council (SIFC) to facilitate and protect foreign investments, targeting lucrative sectors including mining & minerals, energy, agriculture & livestock, information technology, industry, tourism, and privatization.
“Belgian companies must explore opportunities within these sectors and consider partnering in joint ventures to bolster bilateral trade, exports, & economic collaboration.”
He also stressed the need to learn from and benefit from Belgian experience in the ports and shipping sector, which would help Pakistan in enhancing its port capacity through technological advancements, infrastructure improvements, and increased efficiency.
“To reduce trade barriers, there is a need to simplify customs procedures, enhance the ease of doing business, and facilitate SMEs for boosting trade.”
The KCCI chief said that Pakistan and Belgium must also create institutional linkages in the education sector, which would be helpful in the capacity building of Pakistan's universities in addition to offering invaluable learning opportunities to boost their competitiveness on the global stage.
He also identified the automobile, chemicals, pharmaceutical, machinery, plastics, food and livestock, textile, iron & steel, metallurgy, glass, and paper, etc., as potential sectors for joint ventures.