In the intricate landscape of the global economy, trade and business activities stand as foundational pillars for the economic sustainability of any country. In an era marked by heightened connectivity and technological strides that have rendered distances inconsequential, businesses now wield an unprecedented reach for their products and services. At the heart of this economic dynamism, exports emerge as a driving force, propelling economic growth. By venturing into international markets, businesses not only stimulate demand for their offerings but also contribute significantly to overall economic development. In the context of modern economies, the export of goods and services transcends a narrow perspective of mere transactions; instead, it evolves into a strategic avenue that opens doors to a myriad of opportunities, shaping a nation’s growth, stability, and global standing.
For economies like Pakistan, which consistently grapple with the challenge of insufficient foreign exchange reserves, inflow of foreign exchange from export activities is akin to a vital lifeline. This influx significantly contributes to mitigating the current account deficit, enabling the country to fulfill its international financial obligations, facilitating necessary imports, and ultimately bolstering the economic resilience of the nation.
In the pursuit of expanding exports, accessing new markets, and securing preferential treatment, diplomatic influence and partnerships play a pivotal role. Pakistan has actively sought to build a network of interconnected relationships that contribute to enhanced international trade cooperation. Since 2014, Pakistan has benefited from the trading opportunities provided by the European Union’s Generalized Scheme of Preferences (GSP), which includes generous tariff preferences, with zero duties applied to two-thirds of all product categories.
However, to maintain its GSP+ status, Pakistan must adhere to and effectively implement 27 core international conventions covering human and labor rights, environmental protection, and good governance. The European Union (EU) recently released the GSP Report for Pakistan, evaluating the implementation of these 27 international conventions. While the report acknowledges Pakistan’s legislative progress, it underscores the need for improvement in the practical application of these measures.
It is important to note that the GSP+ arrangement has marked a significant transformation in the bilateral trade relationship between the EU and Pakistan. From 2014 to 2022, Pakistan witnessed a remarkable 108% increase in exports to the EU. Particularly, over the last two financial years, nearly 30% of Pakistan’s total exports have been directed toward Europe (excluding UK). Consequently, it becomes imperative for Pakistan to preserve its GSP+ status. To achieve this, concrete steps must be taken to address the concerns raised and ensure continued benefits of this preferential trade arrangement.
Regarding evaluation of human rights situation, the report has expressed apprehensions about enforced disappearances and limitations on freedom of expression. The report highlights ongoing violations of freedom of religion or belief and the rights of minority groups. The government, as part of its constitutional obligation, is urged to take action against discrimination targeting minorities. Additionally, the report calls for addressing those who misuse blasphemy laws and are involved in inhuman activities such as mob violence and lynching.
At a critical juncture, the role of the leading political party, Pakistan Tehreek-e-Insaf (PTI), which held power until April 9, 2022, played a negative role during the renewal process of GPS+ status. The party’s top leadership at that time Dr. Sherin Mazari and Fawad Chaudhry publicly stated that the party was reaching out to international organizations and diplomatic channels to address perceived human rights violations. They also cautioned the ruling alliance, Pakistan Democratic Movement (PDM), asserting that continued alleged human rights violations against PTI members and leaders could jeopardize Pakistan’s GSP-Plus status. Our political leaders need to transcend personal gains and refrain from endangering the state’s interests for their own political advantage.
The report further emphasizes that Pakistani government should expedite the implementation of ILO Conventions, addressing concerns raised in the report regarding low unionization rates and the prevalent issues of child labour and forced labour. Labour unions, fundamentally, can serve as valuable instruments in enhancing working conditions and, consequently, fostering proximity and efficiency within the workforce.
In tackling the issue of forced marriages, it is imperative for authorities to enforce provisions of the Pakistan Penal Code with utmost sincerity, creating a legal framework that unequivocally condemns and penalizes such practices. Furthermore, addressing the socio-economic disparities and marginalization faced by minority groups becomes crucial, as these factors often serve as breeding grounds for incidents of forced conversions.
The report underscores the need for a comprehensive strategy that not only criminalizes such activities but also addresses their root causes. This involves fostering an inclusive environment that promotes tolerance and respect for diversity. The state’s commitment to a zero-tolerance policy sends a strong signal, emphasizing the importance of protecting the rights and freedom of all citizens, regardless of their religious or ethnic background. By adopting a holistic approach, Pakistan can work towards ensuring a society where forced marriages and conversions are unequivocally condemned and prevented, fostering a climate of equality and human rights for all.
The government should collaborate with corporations and international organizations to enhance their adherence to applicable regulations. Given that exports form a fundamental pillar supporting economic resilience and prosperity, such partnerships can propel Pakistan towards a path of sustained growth. By bolstering compliance levels, the country can build a resilient and dynamic economy capable of thriving in an interconnected global landscape.
This collaboration is essential to ensure that corporations align with regulatory standards, fostering a business environment conducive to sustainable growth. Through effective partnerships, the government can create an ecosystem that not only supports businesses but also strengthens the overall economic framework.
The concerted effort can contribute to positioning Pakistan as a competitive player on the global stage, enhancing its economic prospects and promoting prosperity for its citizens in an increasingly interconnected and competitive world. By addressing these concerns and implementing the suggestion, Pakistan can not only retain its GSP+ status but also pave the way for a more inclusive, resilient, and prosperous future, aligning with international standards of sustainable development and good governance. The effective application of recommendations outlined in the Joint Report to the European Parliament and the Council will not only strengthen Pakistan’s global standing but also contribute to the well-being and rights of its citizens in the years to come.
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Dr. Ikramul Haq, Advocate Supreme Court, specialises in constitutional, corporate, media and cyber laws, ML/CFT, IT, intellectual property, arbitration and international taxation. He holds LLD in tax laws with specialization in transfer pricing. He was full-time journalist from 1979 to 1984 with Viewpoint and Dawn. He served Civil Services of Pakistan from 1984 to 1996. He established Huzaima & Ikram in 1996 and is presently its chief partner as well as partner in Huzaima Ikram & Ijaz. He studied journalism, English literature and law. He is Chief Editor of Taxation. He is country editor and correspondent of International Bureau of Fiscal Documentation (IBFD) and member of International Fiscal Association (IFA). He is Visiting Faculty at Lahore University of Management Sciences (LUMS) and member Advisory Board and Visiting Senior Fellow of Pakistan Institute of Development Economics (PIDE).
He has coauthored with Huzaima Bukhari many books that include Tax Reforms in Pakistan: Historic & Critical Review, Towards Flat, Low-rate, Broad and Predictable Taxes (revised & Expanded Edition, Pakistan: Enigma of Taxation, Towards Flat, Low-rate, Broad and Predictable Taxes (revised/enlarged edition of December 2020), Law & Practice of Income Tax, Law , Practice of Sales Tax, Law and Practice of Corporate Law, Law & Practice of Federal Excise, Law & Practice of Sales Tax on Services, Federal Tax Laws of Pakistan, Provincial Tax Laws, Practical Handbook of Income Tax, Tax Laws of Pakistan, Principles of Income Tax with Glossary and Master Tax Guide, Income Tax Digest 1886-2011 (with judicial analysis).
The recent publication, coauthored with Abdul Rauf Shakoori and Huzaima Bukhari is Pakistan Tackling FATF: Challenges & Solutions
available at:
https://www.amazon.com/dp/B08RXH8W46 and
https://aacp.com.pk/product/pakistan-tackling-fatf-challenges-solutions/
He is author of Commentary on Avoidance of Double Taxation Agreements, Pakistan: From Hash to Heroin, its sequel Pakistan: Drug-trap to Debt-trap and Practical Handbook of Income Tax. Two books of poetry are Phull Kikkaran De (Punjabi 2023) and Nai Ufaq (Urdu 1979 with Siraj Munir and Shahid Jamal). He regularly writes columns for many Pakistani newspapers and international journals and has contributed over 2500 articles on a variety of issues of public interest, printed in various journals, magazines and newspapers at home and abroad.
Twitter: DrIkramulHaq
Abdul Rauf Shakoori, Advocate High Court, is a subject-matter expert on AML-CFT, Compliance, Cyber Crime and Risk Management. He has been providing AML-CFT advisory and training services to financial institutions (banks, DNFBPs, Investment companies, Money Service Businesses, insurance companies and securities), government institutions including law enforcement agencies located in North America (USA & CANADA), Middle East and Pakistan. His areas of expertise include legal, strategic planning, cross border transactions including but not limited to joint ventures (JVs), mergers & acquisitions (M&A), takeovers, privatizations, overseas expansions, USA Patriot Act, Banking Secrecy Act, Office of Foreign Assets Control (OFAC).
Over his career he has demonstrated excellent leadership, communication, analytical, and problem-solving skills and have also developed and delivered training courses in the areas of AML/CFT, Compliance, Fraud & Financial Crime Risk Management, Bank Secrecy, Cyber Crimes & Internet Threats against Banks, E–Channels Fraud Prevention, Security and Investigation of Financial Crimes. The courses have been delivered as practical workshops with case study driven scenarios and exams to insure knowledge transfer.
His notable publications are: Rauf’s Compilation of Corporate Laws of Pakistan, Rauf’s Company Law and Practice of Pakistan and Rauf’s Research on Labour Laws and Income Tax and others.
His articles include: Revenue collection: Contemporary targets vs. orthodox approach, It is time to say goodbye to our past, US double standards, Was Due Process Flouted While Convicting Nawaz Sharif?, FATF and unjustly grey listed Pakistan, Corruption is no excuse for Incompetence, Next step for Pakistan, Pakistan’s compliance with FATF mandates, a work in progress, Pakistan’s strategy to address FATF Mandates was Inadequate, Pakistan’s Evolving FATF Compliance, Transparency Curtails Corruption, Pakistan’s Long Road towards FATF Compliance, Pakistan’s Archaic Approach to Addressing FATF Mandates, FATF: Challenges for June deadline, Pakistan: Combating the illicit flow of money, Regulating Crypto: An uphill task for Pakistan. Pakistan’s economy – Chicanery of numbers. Pakistan: Reclaiming its space on FATF whitelist. Sacred Games: Kulbhushan Jadhav Case. National FATF secretariat and Financial Monitoring Unit. The FATF challenge. Pakistan: Crucial FATF hearing. Pakistan: Dissecting FATF Failure, Environmental crimes: An emerging challenge, Countering corrupt practices .
Twitter: Adbul Rauf Shakoori
The recent publication, coauthored by these writes with Huzaima Bukhari, is
Pakistan Tackling FATF: Challenges & Solutions
available at: https://www.amazon.com/dp/B08RXH8W46
