Founder Editor Tazeen Akhtar..

Remarks by H.E. Jean-François Cautain Ambassador of the European Union to Pakistan. GSP+ in Pakistan: Opportunities and Challenges Thursday, 05 November 2015 Marriott Hotel, Islamabad  

• Excellencies, ladies and gentlemen,

thank you all for coming. Many thanks also to Democracy Reporting International for arranging this very relevant and timely interaction.

• First, a few words about EU-Pakistan relations in general. In 2012, the EU and Pakistan adopted a 5-year Engagement Plan with the common goal of building a strategic relationship for peace and development rooted in shared values, principles and commitments. This partnership is facilitating cooperation on a wide range of issues, including a political and security dialogue, economic cooperation, counter terrorism and migration.

• GSP+ is an integral part of the Engagement Plan. I am sure you are already familiar with the scheme. The basic idea is that in exchange for increased market access, countries commit themselves to create progress in key areas of democracy, human rights, labour rights and the environment. This is a win-win approach for the countries that participate. The business sector will get immediate benefits from increased exports. And all sectors of society will benefit from greater adherence to international standards and conventions.

• Almost two years ago Pakistan was granted GSP+ status. A lot of work went into the preparations, both on the EU side and on the Pakistani side. Pakistan had to sign up to a number of conventions that it was not yet a party to and remove reservations on others. And on our side we had long negotiations with EU Member States, the European Parliament and with our industry. We were very pleased when finally the decision on GSP+ for Pakistan was adopted in December 2013, allowing it to enter into force on 1 January 2014.

• Today, I am happy to tell you that GSP+ is working. In 2014 Pakistani exports increased with more than 20% or about 1 billion Euro. In Euro terms this positive trend has continued. If we compare the first half of 2014 with the first half of 2015 there is a further increase of 14% or 366 million Euro. It is true that if this is measured in Pakistani rupees this translates into a smaller decrease (7%) because of the devaluation of the Euro. However, this decrease would have been much greater in the absence of GSP+.

• I believe that the dip in exports in rupee terms is a temporary setback and that growth in Pakistan's exports to the EU can continue in the years to come. But in order to make that happens we have to make sure that the scheme is fully utilized.

 • First, all segments of the Pakistani business sector must be aware of the potential for using this scheme. To this end the EU in cooperation with the Ministry of Commerce has produced a business guide, which informs about all the procedures involved. Second, I see a scope for Pakistan to diversify its exports and to move up the value chain. At the moment exports continue to be dominated by a few sectors, in particular textiles and leather. Third, there is also a need to look at the economic framework conditions. Pakistan still scores low on the World Bank's Doing Business Index and this has to be addressed.

• This was a little bit about the business side of GSP+. Let me now turn to the other side of the coin, which is Pakistan's commitment on implementation of the 27 international conventions. This is the whole rationale for the EU to provide this privileged market access to the Pakistan, so naturally the ability of Pakistan to deliver on this commitment is a prerequisite for maintaining GSP+. Progress will be reviewed every two years. The first report is due to be submitted to EU Member States and the European Parliament by 1 January 2016.

• The 27 conventions cover a wide range of areas, but the most important are human rights and labour rights, so let me elaborate a little more on those.


• I will not deny that the human rights situation in Pakistan is a matter of some concern to the EU. This year the resumption of executions and the 21st amendment on the use of military courts, have in particular been seen as steps backward for human rights in Pakistan. Other areas where we see particular problems include freedom of religion and belief, the situation for religious minorities and the rights of women and children. Labour rights is also an area where there are still shortcomings. Despite a relatively good legal framework, we continue to see problems with child labour, and the right to organise and bargain collectively, to name a few.

• I have to emphasize the need to see tangible progress in these areas if Pakistan wants to preserve its GSP+ status. We are of course aware that the context is very difficult with militancy, extremism, poverty and lack of education being just a few of the obstacles. The horrific terrorist attack on the Military School in Peshawar last December is a particularly dramatic example. However, this should not be a reason not to act. On the contrary, strong human rights and labour rights are key elements to overcome these obstacles.

• We have seen some encouraging signs. The National Human Rights Commission has after some delay now been established and has begun its work. We are also being told that a National Action Plan on Human Rights, the first of its kind, has been elaborated and is awaiting final approval by the Prime Minister. We have also been provided a road map of specific actions, which Pakistan intends to take in the short term to fully implement the 27 Conventions covered by GSP+. This is all very welcome, but I would like to stress the need to follow through on these plans and make sure that they translate into real progress in the daily lives of the men, women and children of Pakistan.

• It is first and foremost the responsibility of the Government to ensure that progress is created in implementation of the 27 conventions. We maintain a close political dialogue with the Government of Pakistan on these issues. In this respect we are happy that the Government has taken the initiative to establish treaty implementation cells at the federal 3 and provincial levels, which coordinate the GSP+ efforts. The EU stands ready to support the capacity of the treaty implementation cells as well as the work being done by other actors on human rights and labour rights in Pakistan.

• I would also like to stress the role that can be played by the business community. They will of course need to ensure that the conventions are respected in their own places of business. But we would also like them to act as advocates for human rights and labour rights. Finally, civil society has a crucial role to play in monitoring and reporting on the progress made and the problems that are still there.

• Ladies and gentlemen, Before concluding I would like to reiterate the five main points, which I would like you to take away from this intervention. GSP+ has already started to work. While it may still be too early to draw definitive conclusions this is in my view a very positive development that deserves to be highlighted; We must now make sure that this trend is continued by disseminating information about GSP+ throughout the business community, consider diversifying production and improving general conditions for doing business in Pakistan; We can also note some positive steps taken by Pakistan to begin to meet the commitments under the 27 conventions, but these are still at an initial stage and have not yet translated into clear progress in the lives of regular people;

Therefore, it is of key importance that further progress is achieved on the ground in implementation of international human rights and labour standards. This must be done in a partnership with the Government, the business sector and civil society. The EU stands ready to cooperate and support all actors working to unleash the full potential of GSP+ both on the trade side and the human rights side.

Thank you for your attention.