Pakistan faces growing uncertainty over its preferential trade access to the European Union as Brussels raises concerns over GSP+ compliance. The current EU Generalised Scheme of Preferences Plus framework will expire at the end of 2026.
Existing beneficiaries are expected to retain preferences during a two-year transition period until December 31, 2028.
However, the transition does not guarantee Pakistan’s automatic inclusion in the successor scheme.
EU Raises Concerns Over Pakistan’s Compliance
EU Ambassador to Pakistan Raimundas Karoblis said the European Commission has serious concerns about Pakistan’s implementation of international conventions linked to GSP+.
He said Pakistan would need to address areas of regression identified in the EU’s latest assessment.
The European Commission’s assessment covering 2023 to 2025 highlighted concerns over several areas.
These included enforced disappearances, extrajudicial killings, freedom of expression and journalists’ rights.
The assessment also raised concerns about minority rights, judicial independence, access to justice and forced labour.
It noted that some legislative and administrative measures had not produced sufficient improvements on the ground.
Pakistan’s Foreign Office said Islamabad remains committed to implementing the 27 international conventions linked to the current GSP+ framework.
However, it argued that the EU assessment did not provide a sufficiently balanced picture of Pakistan’s performance.
Islamabad also stressed that GSP+ remains central to its economic relationship with the European Union.
Billions in Exports at Stake
Pakistan has significant economic interests tied to the preferential trade arrangement.
The country is the largest beneficiary of the GSP+ scheme. In 2024, Pakistan received nearly €732 million in tariff exemptions.
Meanwhile, exports worth $7.115 billion used preferential access to the European market.
The EU accounted for around 28% of Pakistan’s total exports during the year.
Nearly 90% of Pakistan’s exports to the bloc were eligible for GSP+ preferences.
The textile and clothing sector has the strongest dependence on the arrangement.
These products account for around 70% to 76% of Pakistan’s exports to the European market.
Leather products, prepared foods and beverages are also major beneficiaries.
Therefore, losing preferential access could make Pakistani products more expensive and less competitive in a major export market.
New GSP+ Framework Brings Stricter Requirements
Pakistan will also face higher compliance requirements under the successor GSP+ framework. The existing arrangement covers 27 international conventions, while the new scheme will cover 32 conventions.
According to the EU ambassador, Pakistan has already ratified the five additional conventions. However, effective implementation will remain the key test for securing continued benefits.
Pakistan will also need to submit an action plan with specific measures, timelines and performance indicators. The EU has not yet decided whether the concerns identified in its assessment warrant a partial or complete suspension of existing preferences.
The bloc has previously withdrawn GSP+ benefits from countries including Sri Lanka, while Bolivia faced a partial withdrawal.
The EU ambassador said Pakistan’s situation still requires further investigation.
He also warned that the absence of a suspension decision should not be considered a guarantee of continued benefits.
