PAKISTAN AND THE EU’s GSP

Economic Impact

Though it can still be considered vulnerable, Pakistan's economy slowly approaches the vulnerability threshold as defined under the GSP+. At the moment, Pakistan is the least vulnerable among all GSP+ beneficiary countries. In 2019, Pakistan's vulnerability score was 6.7% with the threshold currently standing at 7.4%. On the other hand, the diversification of the economy remains limited and concentrated on a small bandwidth of products. Pakistan's diversification score stood at 94.4% in 2019 with the minimum threshold currently standing at 75%.

Pakistan's preference utilisation rate is consistently among the highest rates of all GSP+ beneficiary countries over the regarded period. The strong increase of about 28 percentage points between 2013-14 can be explained by the additional preferences granted to Pakistan after its transition to GSP+ status on 1st January 2014. The transition was also significant regarding the subsequent increase in imports, which grew by about 16% between 2014 and 2016. Overall imports as well as preferential imports continued to increase between 2016 and 2018. In 2022 the utilisation rate is the lowest since 2014, but still solidly above 90%. The preference utilisation rate in the three dominant import sections, textiles, apparel, and leather articles, has been consistently well above 90% between 2016 and 2022.

The largest product sections under the GSP+

SUSTAINABLE DEVELOPMENT AND MONITORING PRIORITIES

Pakistan ratified 27 core conventions on human rights, labour rights, environmental protection, and good governance.The most recent monitoring results over the period 2018-2019 showed that Pakistan maintained ratification of all relevant conventions. Despite an improvement in overall compliance with reporting obligations in recent years, Pakistan has two outstanding reports on human rights conventions that were due the beginning of this year. Additionally, a number of reports on environmental conventions, including on the Cartagena Protocol and the Stockholm Convention, are overdue.

Monitoring priorities during the reporting period 2018-2019

For the reporting period 2018-2019, the EU has identified ten focus areas for its monitoring activities. Developments in Pakistan provide a mixed picture. In some areas, the government has taken important steps to introduce legislation to support the effective implementation of the conventions. Still more effort and a stronger institutional set up is needed to translate the conventions in national law and ensure their application.

1. HUMAN RIGHTS

Pakistan has ratified all seven fundamental UN human rights conventions which are included in the GSP+ regulation and has additionally ratified the UN Convention on the Rights of People with Disabilities which is not required under the GSP+. During the reporting period, Pakistan has passed a number of important laws which support the effective implementation of core human rights treaties. This includes inter alia legislation that strengthens the rights of transgender persons, prevents domestic violence, restricts child marriage and sexual assault against children. Additionally, there is a positive trend on the promotion of religious freedom. Despite the government drafted a Journalist Welfare and Protection Bill, the overall situation of press freedom shows a negative trend. This also applies to the situation of civil society organisations and human rights defenders. The registration of international NGOs remains opaque and cases of intimidation, abduction and killing of human rights defenders and journalists are often not properly investigated or prosecuted which poses a serious threat to the right to freedom of expression. A review process has been started to align the national definition of "most serious crimes", for which a death sentence can be imposed, with the provisions under the International Covenant on Civil and Political Rights (ICCPR). Similar efforts are undertaken to legally define and criminalise torture as required under the Convention Against Torture (CAT). Gender equality is another important area where additional progress is required. Women still often face domestic violence, social and economic restrictions which lead to systematic inequality. A positive development is the increasing number of women participating in elections for National Assembly general seats.

Ratified

• Convention on the Prevention and Punishment of the Crime of Genocide (1948)
• International Convention on the Elimination of All Forms of Racial Discrimination (1969)
• International Covenant on Civil and Political Rights (1976)
• International Covenant on Economic, Social and Cultural Rights (1976)
• Convention on the Elimination of All Forms of Discrimination against Women (1981)
• Convention against Torture and Other Cruel, Inhuman or Degrading Treatment or Punishment (1987)
• Convention on the Rights of the Child (1990)

2. LABOUR RIGHTS

Pakistan has ratified all eight ILO conventions required by GSP+ and has additionally ratified the Labour Inspection Convention and the Tripartite Consultation Convention which are not officially covered by the GSP+ regulation. Nonetheless, the effective implementation of these conventions is hampered by a very weak labour inspectorate system. A Child Labour Survey has been initiated, while until now no steps have been taken to introduce a comprehensive child labour law. Likewise, the enforcement of existing regulations remains insufficient with regards to Child Labour. Furthermore, the rights and provisions under the ILO Convention on freedom of association and collective bargaining are being systematically disregarded. Forced labour remains a major problem although it is legally prohibited. Gender inequality also persists in the labour markets and manifests itself in unequal payment, overall lower participation of women in the labour force and their limited presence in high level occupations.

Ratified

• Freedom of Association and Protection of the Right to Organise Convention, 1948 (No. 87) 
• Right to Organise and Collective Bargaining Convention, 1949 (No. 98) 
•  Forced Labour Convention, 1930 (No. 29)  (and its 2014 Protocol )
• Abolition of Forced Labour Convention, 1957 (No. 105) 
• Minimum Age Convention, 1973 (No. 138) 
• Worst Forms of Child Labour Convention, 1999 (No. 182) 
• Equal Remuneration Convention, 1951 (No. 100) 
• Discrimination (Employment and Occupation) Convention, 1958 (No. 111) 

3. ENVIRONMENTAL PROTECTION

Pakistan has ratified all relevant conventions covered under GSP+ and has stepped up its commitment to ensure effective implementation. Likewise, the overall level of awareness among civil society organisations about the provisions under the environmental protection conventions has increased. Addressing climate change is a focus area of the government as the country is highly vulnerable to the impacts of climate change. The country aims to reduce its emissions by 20% until 2030. Pakistan continues to import hazardous waste and often fails to test scraps for contaminants before they are being reused in manufacturing which violates existing national regulations. The government has taken steps to introduce Hazardous Waste Management Policy. In order to address illegal trade of wildlife, the authorities cooperate with a number of stakeholders (e.g. WWF and local communities) and takes part in different regional initiatives like the South Asia Wildlife Enforcement Network.

Ratified

• Convention on International Trade in Endangered Species of Wild Fauna and Flora (1973)
• Montreal Protocol on Substances that Deplete the Ozone Layer (1987)
• Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and their Disposal (1989)
• Convention on Biological Diversity (1992)
• United Nations Framework Convention on Climate Change (1992)
• Cartagena Protocol on Biosafety (2000)
• Stockholm Convention on persistent Organic Pollutants (2001)
• Kyoto Protocol to the United Nations Framework Convention on Climate Change (1998)

4. GOOD GOVERNANCE

Capacities have been enhanced to effectively address corruption. Some national authorities, like the National Accountability Bureau, will still need more autonomy and confidence to continue to work effectively. Furthermore, the bureau is encouraged to take a more universal approach on accountability as it is currently criticized for its imbalance towards opposition parties. Furthermore, Pakistan remains on the route of drug traffickers, despite significant seizures and stricter measures. The government introduced national programmes to address the demand side and tackle drug abuse.

Ratified

• United Nations Single Convention on Narcotic Drugs (1961)
• United Nations Convention on Psychotropic Substances (1971)
• United Nations Convention against Illicit Traffic in Narcotic Drugs and Psychotropic Substances (1988)
• United Nations Convention against Corruption