Founder Editor Tazeen Akhtar..

Speech by German Ambassador Ina Lepel at DRI-Conference: “GSP+ in Pakistan: Opportunities and Challenges”

5. November 2015

 Excellencies, ladies and gentlemen, thank you very much for coming to this conference today.

 It is a pleasure and honor to have the Minister for Commerce Khurram Dastgir Khan with us today. Thank you also Jean-Francois, the EU Ambassador, for joining us.

I would like to thank DRI for organizing this event. We are proud to be DRI’s partner in this and to make a contribution to making GSP+ a success.  This conference comes at a good time as GSP+ in Pakistan will have its first review at the beginning of next year. This conference brings together a lot of expertise on GSP+ that I myself cannot offer. What I would like to do is to say a few words on how GSP+ is indeed “An Agenda for a Democratic Society”, as my speech is announced in the programme, and how I see the current narrative about GSP+ in Pakistan.

Ladies and Gentlemen,

German Foreign Minister Frank-Walter Steinmeier often quotes a study by the international consultancy firm McKinsey on global economic networks, and to what extent different countries are integrated into the global economy, and how integration benefits these countries. They measured import/export flows and data streams of countries around the world. One of the results is that Germany is the most connected and economically integrated country in the world. Germany and its businesses benefit from a peaceful, open and rules-based world and economic order.

Unfortunately, the McKinsey study puts Pakistan towards the end of the ranking of economic integration and business networks.

But I am convinced that this can be changed. I am convinced that GSP+ is making a contribution to change that - a contribution to further connect Pakistan with the rest of the world, to modernize Pakistan and to unlock the potential Pakistan has beyond any doubt.

GSP+ is the world’s most generous preferential market access programme. It offers duty free access for over 90% of all products to the EU, which is one of the largest markets in the world, with over 500 million relevant customers. GSP+ puts in action a leitmotiv of Prime Minister Nawaz Sharif: Trade instead of aid.

Let’s look at the data: In the first year of GSP+ we have seen more than 20% increase in Pakistan’s exports to the EU, while Pakistan’s exports to the rest of the world have decreased. Businessmen from across Pakistan tell me how important GSP+ is for their business. I am looking forward to hearing from experts at this conference in detail how GSP+ is performing in the second year. The data that I have seen so far indicate that the positive developments from the first year are continuing. At the beginning of the year we have seen some dents in the steep increase in exports. But I believe this was mainly due to the weak Euro, which is regrettable for Pakistan’s exporters, but not the fault of GSP+.

GSP+ is the expression of Europe’s offer of partnership to Pakistan. It is a door, wide open and with a very low doorstep. We invite Pakistani businesses to use the door and to cross the doorstep.

GSP+ considerably improves the competitiveness of Pakistani products in Europe. However, it does not relieve Pakistan from its obligation to do whatever it can do itself to improve the competitiveness of its economy and business even more: And you know, better than I, the relevant issues: energy, administrative and fiscal framework, diversification of exports, moving up the value chain, especially in the textile sector, among others.

Ladies and Gentlemen,

Now, I would like to talk a bit about the narrative about GSP+ in Pakistan as I see it. And this brings me to the 27 international conventions  on human rights, labor standards, governance, environment etc that Pakistan has committed itself to implement when it signed the GSP+ agreement with the EU. Indeed, it is not by joining the GSP+ scheme but by becoming a state party to these international treaties that Pakistan has taken upon itself binding obligations. GSP+ is just an incentive to speed up and intensify full implementation of these obligations.

You all know that the human rights situation in Pakistan, in some of its aspects, gives rise to concern, for example with regard to minorities or human rights defenders.  Neither is the end of the moratorium on the death penalty and the execution of close to 300 people in less than a year – human rights experts have started to use the word “mass executions” -  going unnoticed, neither here in Pakistan nor in Europe, neither among Governments nor Parliaments nor civil society. My country, and the EU as a whole - we are convinced that the death penalty is an inhuman punishment, practically not helpful in Pakistan’s fight against terror and very harmful for Pakistan’s image abroad, among Governments, Parliaments and civil society. And the issue becomes relevant for GSP+ in legal terms also, in the case of potential violations of obligations under international law, for example the execution of persons under 18 years of age at the time of the crime.

It seems to me that those 27 conventions are sometimes presented as the price to pay, or the burden to carry, for Pakistan in order to get free market access to the EU. But I would like to offer a different narrative:

I am convinced that implementation of these conventions  – just like the trade preferences – offers an opportunity to further modernize Pakistan, to connect it to the rest of the world, and to integrate it into the global economy. In other words, implementation is in Pakistan’s own very best interest.

Firstly, even if we sometimes disagree on specific aspects, it is important to note that Pakistan has signed and ratified, and thereby committed itself to those conventions voluntarily. The provisions of these conventions reflect universal values and a consensus that sovereign states have agreed upon, Pakistan among them. These conventions connect us with each other, as partners and friends around the world. In essence, they reflect that all human beings, without distinction, and regardless in which country they live, have their inalienable human dignity and rights, and that our Governments have recognized this. So Governments do not respect and fulfill human rights and labour rights in the first place in order to obtain trade preferences, but for the sake of their own people.

Secondly, and in addition, implementation of these conventions offers enormous benefits and opportunities. Take for example the provisions on labour standards: Customers in the EU and other countries around the world are more and more willing to pay more money for a product that is produced according to international standards.  “Fair trade” is not something “nice to have” but a decisive factor for the success of business. Labour standards also enable more efficient production in the long run. Fulfilling people’s rights to education and health provides for a better qualified, more innovative and physically and mentally stronger labour force.  Human rights in general - civil, political, economic, social and cultural - are the basis of a democratic, resilient and prosperous society and benefit people from all levels of society.

It is first and foremost the responsibly of each Government to implement these conventions; and cooperation among Governments to support each other in the effort to meet one’s obligations towards one’s own population, belongs to the good practice of international cooperation and partnership. My country, Germany, is committed to supporting Pakistan in its efforts to meet its obligations under the 27 conventions, and we do so through projects that provide advice and expertise.

Many of the stakeholders here today can play a role as well. Not least the business community who has a natural interest in the continuation of the trade preferences, but also in the implementation of the labour standards, as well as in a well-qualified and healthy workforce.  We would encourage them to work with us and the Government to promote and ensure further progress in GSP+ implementation.

I would like to wish you all an interesting and fruitful conference. I am looking forward to seeing the outcome this afternoon.

 Thank you for the attention.