EU trade policy brings 'new found influence' in Pakistan

Written by Richard Howitt MEP on 23 February 2015 in Special Report
Special Report

Trade incentives can have a positive effect on conditions among the EU's trade partners, argues Richard Howitt.

As the debate about the claimed threat to social and environmental standards in the EU-US 'TTIP' negotiations rages on, an official European parliament visit to Pakistan last week showed how trade incentives can positively boost conditions .

Awarding the general system of preferences - plus (GSP+) preferential trade access to Pakistan a little over a year ago may seem an obscure title, but the decision was hard fought among MEPs sceptical about the state of democracy in this giant South Asian nation, which had seen the first ever peaceful transition in civilian power in the country's history in 2013.

The first official visit from parliament's delegation to the country last week since those elections took place, confirmed both the fragility of democratic progress but also of Europe's importance in solidifying it.

"The first official visit from parliament's delegation to [Pakistan] last week...confirmed both the fragility of democratic progress but also of Europe's importance in solidifying it"

Proposals for electoral reform partly emanating from an EU election observers' report which I had taken part in compiling, were seen to be stuck among wrangling in a parliamentary sub-committee. A timetable for restoration of elected local government has been similarly stalled. Meanwhile, the grave terrorist threat to the country has seen powers transferred back from the civilian government giving the military the power of internment, trial of military suspects and restoration of the death penalty.

Nevertheless, the other side of the balance sheet in this complex country sees a more questioning young population, a flawed but independent judiciary, a diverse media and - in spite of all countervailing forces  - what was described as the "survival" of civilian government.

What was remarkable among leading political, business and civil society representatives, was the widespread knowledge of that GSP+ acronym and of enhanced political leverage for the EU as a result.

In just 12 months since the EU trade preferences were enacted, Pakistan's commerce ministry estimates an extra €880m of exports had been generated. Some 15 million manufacturing jobs are being supported it was claimed, even if there is little evidence yet suggesting that the quality of work has improved.

As parliament's rapporteur on corporate social responsibility, I found better standards of water usage in one clothing firm we visited were influenced much more by environmental pressure on buyers from European brands than by any direct requirement of European trade conditionality.

"As parliament's rapporteur on corporate social responsibility, I found better standards of water usage in one clothing firm we visited were influenced much more by environmental pressure on buyers from European brands than by any direct requirement of European trade conditionality"

Nevertheless our delegation's visit will inform the drawing up of a 'scorecard' which will be used to review the extension of the trade preferences as soon as next year, and which can play a genuine role advancing actual implementation of human rights, social and environmental commitments.

This possibility that European trade preferences given can also be removed, was clearly concentrating minds in the country. It meant our delegation was listened to when we expressed Europe's absolute opposition to the death penalty, with coordinated lobbying by the EU and its member states already having helped secure stays of execution.

We made representations seeking to limit the number of cases in the military courts and to allow local and EU observers. Already Pakistan had agreed to lift 16 out of the 19 "reservations" it had tabled in the United Nations, to considerably expand the application of human rights law in the country.

Europe's trade powers seemed to have begun to have 'real teeth.'

"Europe's trade powers seemed to have begun to have 'real teeth'"

During this visit, parliamentary recommendations for electoral reforms were promised to us in less than two weeks, and local elections in the most significant Punjab region would be completed within this calendar year, we were told.

Ultimately these commitments are promises to the people of Pakistan, not to Europe. Pakistan is a sovereign nation and it is important to exercise European influence in a spirit of mutual respect and partnership.

However, in a country which is a major trading partner for Europe - which also enjoys strong people-to-people contacts stemming from our common history, and which presents a serious security challenge both across its borders and within them - this new found influence is strategically very important for our own interests.

When the European parliament wrestled with its decision about 'GSP+' status a year ago, we were making an important determination about Europe's own status too.

About the author

Richard Howitt MEP (S&D, UK) is vice-chair of the European parliament's delegation with South Asia and also S&D group spokesperson on foreign affairs.

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