PM tasks officials to secure GSP Plus status beyond 2018

ISLAMABAD: Prime Minister Shahid Khaqan Abbasi on Friday directed authorities to ensure continuation of the lucrative EU trade concession status through Generalised System of Preferences (GSP) Plus, mainly benefiting the country’s textile export industry, beyond 2018.

“Commerce Division and relevant foreign missions abroad (are directed) to maintain a focused approach towards ensuring continuation of GSP Plus status and take all necessary measures to maintain the growth oriented trend,” the statement quoted PM Abbasi as saying at a meeting held to review the efforts afoot to secure the said status beyond 2018.

The GSP Plus status, granted from January 2014, permitted nearly 20 percent of Pakistani exports to enter the 28-member countries of EU bloc at zero tariff and 70 percent at preferential rates. Pakistan was among the nine countries – including its textile rivals Bangladesh and Sri Lanka – that won the GSP Plus status.

Pakistan, however, could lose GSP Plus anytime till 2023 for noncompliance with anyone of the 27 conventions related to human and labour rights.

The meeting informed the prime minister that periodical review report by the government on the status has already been submitted.

“The EU has examined the report and positive outcome is expected, following which our GSP Plus status will be extended for another three years,” the statement, quoted official as saying.

The statement said the country’s exports to EU had registered 45 percent increase while value-added textile products 88 percent over the past five years.

The country, facing a steep fall in exports, desperately needs concessional markets to narrow its ballooning trade deficit, which surged 24.5 percent to $17.963 billion in the first half of the current fiscal year of 2017/18.

A wider trade gap also inflated the July-December current account deficit, which widened 59 percent to $7.413 billion in the first six months of the current fiscal year.

Analysts, however, expect recent rupee devaluation and increased import duties on non-essential products will contain import growth. Rupee has lost more than seven percent of its value since December.

The government last year slapped import duties on non-essential products and is expecting to slash import bill by more than two billion dollars.

Government eyes $23 billion in exports revenue in the current fiscal year, which means the exporters should fetch at least $12 billion in the second half.

The meeting was attended by Pervaiz Malik, minister for commerce, Miftah Ismail, advisor to PM on finance, and senior officials from commerce, foreign affairs, economic affairs, human rights and religious affairs divisions.