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As the EU strengthens its trade frameworks, Pakistan’s duty-free access to the European market under the GSP+ scheme faces renewed scrutiny.
Pakistan’s privileged position under the Generalised Scheme of Preferences Plus (GSP+)—a status that allows over 76% of its exports to the EU to enter duty-free—is currently undergoing a critical reassessment by the European Commission, as part of its monitoring process on human rights, labor laws, environmental standards, and good governance.
Since Pakistan joined the GSP+ framework in 2014, its exports to the EU have surged significantly, doubling to €8 billion by 2023, with €2.4 billion directed to Germany alone. This preferential trade treatment has turned the EU into Pakistan’s largest export destination, especially boosting its textile and garment industries.
Status Under Systematic Review
The latest monitoring cycle, which began in June 2022, has temporarily extended Pakistan’s GSP+ benefits until 2027. However, the future of these trade privileges hinges on the outcome of the ongoing review of Pakistan’s compliance with 27 international conventions.
According to Dr Martin Henkelmann and Florian Walther of the German Emirati Joint Council for Industry and Commerce (AHK UAE), “Pakistan’s GSP+ status remains under systematic review by the European Commission as part of the ongoing monitoring cycle.”
The next major evaluation milestone is the GSP+ monitoring mission scheduled for June 2025, which will assess Pakistan’s adherence to the scheme’s conditions.
New Framework, Stricter Demands
In response to shifting global priorities, the EU has revised the GSP+ framework, making it more rigorous. The updated rules now include additional conventions, stricter procedural standards, and a new requirement for countries to submit detailed action plans outlining how they intend to implement reforms.
“Pakistan has been given a two-year transition period to meet the new standards,” said the German officials, noting that the review now spans a three-year cycle to enable deeper and more structured assessments.
In their remarks, Henkelmann and Walther stressed that continued access to GSP+ is not just about meeting formalities; it’s a strategic economic lifeline.
“In our own engagements with stakeholders across Pakistan including chambers of commerce, export associations, and the business community itself, it is consistently highlighted that GSP+ is not just a trade preference but a vital enabler of employment, growth, and economic diversification.”
With jobs and foreign exchange earnings closely tied to GSP+ access, Pakistan must now show tangible progress on reforms to retain its status and reassure key partners like Germany.
The revised EU approach aligns GSP+ enforcement more closely with international treaty mechanisms and seeks to uphold the scheme’s integrity and credibility. While Pakistan has made notable strides in benefiting from the trade privileges, sustaining this momentum will depend on its ability to comply with enhanced obligations and showcase measurable reforms.
As the 2025 assessment nears, Pakistan’s government and industry must prepare for a higher bar of accountability to preserve what has become a cornerstone of its economic partnership with the EU.
