The European Union (EU) trade chief has proposed opening the EU to more imports from developing countries, fuelling a debate about protectionism and the bloc’s ties with trade partners such as Pakistan.
Trade Commissioner Karel De Gucht’s office has proposed that the threshold for imports under the EU’s Generalised System of Preferences (GSP) be increased, leading several EU commissioners to raise strong objections. De Gucht’s proposals, which are due to be formally presented on Tuesday, would grant preferential trade terms to poorer countries whose exports to the EU make up two per cent of total EU imports, raising the limit from one per cent currently.
That would allow both Pakistan and Ukraine, whose exports are more than one per cent of total EU imports, to take advantage of the most preferential trade status. Pakistan is a major producer of textiles and both are producers of ethanol.
In a document seen by Reuters, senior representatives for 10 of the 27 members of the Commission opposed the plan, saying it could unfairly benefit Pakistan and Ukraine, while harming textile and other industries in Portugal and elsewhere.
“Three key points remain unresolved that have given rise to objections” on a reform to GSP, said the document, which was prepared after a Commission meeting on Thursday.
Senior officials responsible for agriculture, internal market and industry policy warned that Pakistan and Ukraine’s booming exports would hurt EU producers, the document showed.
One official questioned the political signal the EU would be sending in granting Pakistan GSP Plus status, particularly in light of “current events”, a reference to allegations that elements in Pakistan may have helped shelter Osama bin Laden.
An earlier attempt to lift the GSP threshold from 1 per cent to 1.5 per cent had already failed, and a separate effort by the EU to improve trade terms for Pakistan following its flood disaster last year is now bogged down in dispute at the WTO.
Published in The Express Tribune, May 7th, 2011.
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