ISLAMABAD: Members of EU Parliament (MEPs) have voted to extend the current rules on the scheme of generalized tariff preferences, the EU said in a statement on Thursday, rolling over the special incentive arrangement for another four years for developing countries, including Pakistan.
The EU’s GSP+ scheme gives developing countries a special incentive to pursue sustainable development and good governance. Eligible countries have to implement 27 international conventions on human rights, labor rights, the environment and good governance. In return, the EU cuts its import duties to zero on more than two thirds of the tariff lines of their exports.
The current GSP regulation was set to expire at the end of 2023, and negotiations between the Parliament and the Council of member states took off in January 2023 to establish new rules. In June, talks were paused as the gap between the position of the Parliament and member states could not be bridged, and as a result, the current rules were prolonged. The scheme has now been extended until December 31, 2027.
“By dealing swiftly and efficiently with this prolongation and rollover, the Parliament underlines that it will not let beneficiaries down,” rapporteur Heidi Hautala said during the plenary.
“The 2012 regulation expires at the end of this year, thus it was necessary to prolong its validity in order to avoid significant socio-economic disruptions for the beneficiary countries and as well for the companies.”
She added that the rollover was an “unfortunate consequence” of not being able to reach an agreement between the Council and Parliament on the ongoing review of the GSP regulation over two outstanding issues: the link the Council wanted between tariff preferences and the obligation of readmission, and safeguarding rice producers without creating excessive trade barriers.
On the first issue, Hautala said: “The European Parliament’s position is against the inclusion of this type of migration policy measures because this is a trade and development policy instrument, which benefits 2 billion people in the developing world.”
“The trilogues will continue, and it is vital to conclude them as soon as possible. Now it is very important that the Parliament and the Spanish presidency go the extra mile and make this review a reality. This would require, however, a change in the approach by the Council on the question of readmissions. We need to preserve the GSP as a development tool.”
The European Union’s ambassador to Pakistan said the rollover had been proposed ”to avoid a cliff edge at the end of 2023” and was unrelated to Pakistan’s performance on its obligations or that of any other beneficiary country.
The Council is expected to give its final approval for the extension of the current rules “soon,” the EU statement said.
The Generalized System of Preferences has been the EU’s preferential trade arrangement with developing countries since 1971. The policy covers more than 60 countries and benefits approximately two billion people.
“I take this opportunity to reiterate Pakistan’s commitments under the Scheme for the betterment of all,” Pakistani Commerce Minister Dr. Gohar Ejaz said after the EU announced the rollover.
