In a meeting with Ambassador Olaf Skoog, the European Union’s (EU) Special Representative for Human Rights, Commerce Minister Jam Kemal Khan, attempted to strengthen preexisting trade ties. Jam Kemal vowed to follow the 27 international conventions that allow Pakistan to remain the beneficiary of numerous trade benefits.

 

These benefits fall under the umbrella of the Generalized Scheme of Preferences Plus (GSP+) and are vital for the growth of Pakistani businesses and the economy. The minister explored further avenues of economic integration with the EU via increased trade and commercial cooperation.

 

As per the commerce ministry, officials from both sides discussed matters pertaining to the advancement of commercial benefits to Pakistan in exchange for Pakistan’s continued commitment to certain international conventions.

 

These conventions cover a broad range of issues, such as good governance, environmental standards, and human and labour rights. According to reports, Pakistan is already a signatory, and further assurances outline Islamabad’s commitment to following the rules in exchange for economic incentives.

 

The timing of the meeting is crucial as the United States (US) seems to be backing out of aid initiatives. President Donald Trump froze funding for all USAID initiatives while issuing directives to organisations working to halt their operations.

 

Donald Trump’s decision will significantly impact Pakistan’s economy as USAID was involved in numerous projects in the country. According to reports, USAID funds were being utilised to strengthen human rights, democracy and good governance.

 

The EU requires Pakistan to follow conventions that coincidentally are the ones that USAID was funding. With aid payments frozen, Islamabad may find it difficult to stay on the right roadmap, which could jeopardise concessions from the EU. As such, ensuring the continued economic support of the EU was necessary as a moratorium on concessions to Pakistan could significantly hinder economic growth.

 

In 2023, the EU’s parliament extended Pakistan’s GSP+ status until 2027, along with other developing countries. The four-year extension allowed for Pakistani exports to face minimum duty or even no duty on their products.

 

Data has revealed, however, that despite possessing this trade advantage, the export value of goods from Pakistan to the EU declined to $8.240 billion, which translates to a drop of approximately three percent.

 

The EU’s office in Islamabad announced that 30 percent of all Pakistani exports end up at the EU’s shores. This explains Jam Kemal’s comment regarding commitment to international conventions being ‘beneficial’ for Pakistan.

 

The commerce minister reaffirmed to follow through on all initiatives enacted by the Treaty Implementation Cell. The commerce minister’s efforts seem to have been convincing; however, many analysts are wondering if the EU will extend Pakistan’s GSP+ status when it nears expiration in 2027.