Thaindian News

Brussels, Sep 10 (DPA) A EU summit next week could produce a temporary reduction in tariffs for Pakistan to contribute to the country’s recovery from its devastating floods, EU officials said Friday.
EU foreign ministers weighed up the options for helping Pakistan at the start of a two-day informal meeting in Brussels. They were looking for a way that could be implemented relatively quickly.

An EU diplomat who was present at the talks said they plumped for a so-called World Trade Organisation (WTO) waiver, meaning that the EU would temporarily grant Pakistan a tariff reduction on some key products, mainly textiles.

EU trade commissioner Karel De Gucht was asked to carry out a feasibility study, including estimates on the economic cost of the concession, and report to the EU foreign ministers meeting Sep 16 in the context of an EU summit, which could then approve the decision.

The EU’s waiver for Pakistan could be challenged by other WTO members. But even if that happened, the procedure would take at least a year to get started, leaving the measure in place in the meantime.

The measure was preferred over upgrading Pakistan’s formal trading partner status within the EU’s General System of Preferences (GSP) because that would need European Parliament approval, likely to take months, the source explained.

Pakistan’s upgrade to “GSP Plus” status could still take place “in the longer term”, as the system is reviewed next year, diplomats said.

A third proposal, suggested earlier Friday by De Gucht, would not have targeted Pakistan specifically but would have lowered tariffs on 13 kinds of products that Pakistan specialises in, was rejected.

But EU states rejected, as they “feared that China and India could also specialise in those products and take advantage of the concession”, the diplomat said.

The EU is Pakistan’s most important export market and its second most important trading partner, but Pakistan ranks just 48th among the EU’s trading relationships. Trade flows were just under seven billion euros ($8.9 billion) in 2009.

Pakistani officials regularly say that they want “trade, not aid”, from the EU, arguing that the best way the bloc could help their country would be for it to buy more of their products.