The EU accounts for 20 percent of Pakistani external trade with Pakistani exports to the EU amounting to $3.4 billion, mainly textiles, medical equipment and leather products, and the EU exports to Pakistan amount to $3.8 billion and consist mainly of mechanical and electrical equipment, and chemical and pharmaceutical products.
Although Pakistan has made huge progress in the implementation of EURA which is duly recognized by the EU, yet Greece, France, Italy and Spain continue to raise concerns regarding this issue. The United Kingdom is Pakistan''s trade partner in Europe with bilateral trade amount to Euro 2.08 billion in 2016. Pakistan''s export to UK amounted to Euro 1.3 billion while imports from UK amount to Euro 756 million.
Pakistan''s exports to the UK increased from Euro 973 million in 2013 to Euro 1.33 billion in 2016 which represents an increase of 36.6 per cent. Meanwhile, Pakistan''s imports also increased from Euro 528 million in 2013 to Euro 756 million in 2016 which constituted an increase of 43 per cent.
Over the years as manufacturing has started to shift towards China and south East Asia, Pakistan has missed out on a lot of foreign direct investment and bilateral trade agreements with strong economies because of war against terror. As a result of that Pakistani products started to lose their competitiveness in the EU after 2005 when the EU excluded Pakistan from its Drug Related Arrangements (GSP Plus) which offered duty free access to countries fighting the menace of drug trafficking.
Pakistan was of the view that its competitors like Bangladesh continued to enjoy duty free access under EU''s "Everything But Arms" scheme for Least Developed Countries. Turkey also had duty free access in the EU. Vietnam has concluded its FTA with EU while negotiations while negotiations between the EU and India are already underway.
"We are of the view that in the absence of a secure enhanced market access for Pakistan in the EU and UK, diversion of trade and investment from Pakistan to these countries can occur which can be detrimental for Pakistan''s economic situation," said Commerce Minister. He further stated that duty free access for Pakistani products in the UK after Brexit was crucial for retaining competitiveness and diversifying Pakistani export.
However, it is matter of great satisfaction that the UK has decided to maintain the enhanced level of market access available to Pakistan in EU under its GSP Plus scheme after formal exist from the EU. He said Pakistan sees GSP Plus as very positive and constructive way of engaging developing countries with low per capita incomes and vulnerable exports.
"Mayor London held talks in Ministry of Commerce which were conducted in very cordial and frank manner. During these talks we had an overview of our bilateral trade and investment and discussed ways for enhancing it substantially in coming years," said the commerce minister at a business forum. He said Pakistan is pleased that UK is going to adopt EU''s GSP+ scheme even after Brexit and the cooperation between Pakistan and UK can continue in the fields of trade, human rights, climate change, narcotics control and good governance.
The commerce minister also hosted a lunch in honour of visiting London mayor and his delegation. Both the minister and London mayor also appeared before the press for few minutes wherein the commerce minister read a written short statement while London mayor read his statement extempore. However, they did not take questions which disappointed the waiting journalists.
The minister stated that UK has decided to adopt EU''s GSP+ scheme after Brexit and "we reiterated our commitment to adhere and effectively implement to 27 UN Conventions pertaining to sustainable development and good governance." The mayor also reiterated the UK government''s stance that it would continue GSP Plus status for Pakistan even after Brexit.
"We hope that UK companies with experience in building infrastructure and energy can find a lot of scope in CPEC project and join in this mega project that is going to enhance connectivity between many countries of the world immensely," Pervaiz Malik maintained.
Copyright Business Recorder, 2017