EU to develop direct links with textile industry

[LahoreEstate]

MUSHTAQ GHUMMAN
ISLAMABAD (October 19 2009): The European Union (EU) has decided to develop direct links with Pakistan's textile manufacturers to discuss the possibility of extending the coveted 'Generalised System of Preferences' (GSP) plus other incentives, sources told Business Recorder.

First direct meeting between the Trade and Commercial Counsellors of the EU countries and All Pakistan Textile Mills Association (Aptma) is scheduled for October 21, 2009, in Islamabad, sources added. Muhammad Akbar Sheikh, Acting Chairman of Aptma, will give a detailed presentation on the problems faced by the industry in the EU countries. "We will ask the EU to declare Pakistan an 'Adversely Impacted Economy' (AIE) because of the negative impact of war on terror on Pakistan's economy," said a top Aptma office-bearer. Sources said that the association has also asked the concerned ministries to provide an update on market access efforts of the government.

Aptma's research and development centre is preparing its presentation to respond to following critical questions: (i) how can Pakistan be included in GSP like Sri Lanka; (ii) how ROZ type facility can be provided by the EU; (iii) what non-tariff barriers are being faced by Pakistan's textile exporters; (iv) how Saarc cumulating rules can benefit Pakistan's exports; (v) how land route, railways transport link through Turkey can help Pakistan's exports; (vi) how repetition of trade remedy measures by the EU can be avoided; (vii) how EU can assist Pakistan in compliance issues and forthcoming environmental issues; and (viii) how EU can help Aptma in an effective participation in WTO negotiations. It is unclear if the government has provided such information to the EU, as the working style of government departments is completely different from the private sector associations like Aptma.

Sources said the chairman of Aptma committee on WTO would also call for 'GSP plus' market access, which has been denied because of technical reasons. Pakistan's GSP textile exports to EU exceeded the limit of 1 percent of EU GSP imports by 0.48 percent, disqualifying Pakistan. "Aptma will ask that limit of 1 percent to be raised to 3 percent for AIE economies," Akber said, while talking with this correspondent, from Lahore.

"Maintenance of regional economic balance is an essential condition of maintenance of regional sociopolitical stability. Unfortunately, the war on terror has caused incalculable loss to Pakistan's economy. No aid can compensate this loss, and the world must come forward to help Pakistan enhance its trade," he said, adding that Aptma would also call for effective implementation of Saarc cumulating rule by elimination of circumventing subsidies by existing GSP plus beneficiaries.

According to him, the association will stress on increased communication between EU trade officials and Aptma, whose members account for 65 percent of the country's textile output. "Increased interaction will help Aptma in its work on compliance issues, better management practices in cotton production, energy conservation, and trade remedial measures, he said. It is pertinent to note that Pakistan and the EU are also holding talks on a Free Trade Agreement (FTA), which is a challenging proposition for the European countries.

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