The European Union's latest assessment of Pakistan's performance under the GSP+ preferential trade scheme presents a mixed picture. There is encouraging progress, but also areas of serious concern. The report is neither a recommendation to withdraw Pakistan's GSP+ status nor a clean bill of health.
Among the positive developments, the report highlights stronger human rights institutions, the establishment of a National Commission for Minorities, the narrowing of the scope of the death penalty, the continued de facto moratorium on executions, implementation of the Anti-Torture Act, and measures to combat gender-based violence. At the same time, it identifies significant concerns relating to political rights, judicial independence, enforced disappearances, freedom of expression, and media freedom. It also raises questions about the application of laws concerning blasphemy, counterterrorism, and cybercrime.
Ratifying international conventions and passing legislation are important first steps, but they must be matched by effective implementation. This becomes even more important as the EU's new GSP regulation comes into force on January 1, 2027, introducing stronger sustainability and governance requirements for beneficiary countries. GSP+ has been highly beneficial for Pakistan.
It provides preferential access to the European market without requiring reciprocal tariff concessions to European exporters. In 2024 alone, Pakistan exported goods worth around 7.5 billion under the scheme, with tariff preferences estimated at approximately 732 million. Nevertheless, GSP+ should be viewed as a transitional arrangement rather than a permanent framework for Pakistan's trade relations.
First, the preferences are conditional. Pakistan remains under continuous monitoring, and the concessions can be suspended if the EU concludes that the country has failed to meet its commitments. The latest report illustrates the nature of this ongoing scrutiny.
Second, GSP+ is a unilateral preference scheme, meaning that the EU can exclude any product if it feels that it has become sufficiently competitive. Unlike a free trade agreement, it provides no permanent or contractual guarantee of market access. Pakistan's recent experience with ethanol illustrates this vulnerability.
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