Pakistan and European Union (EU) Relations
Pakistan and European Union (EU) Relation
Annajam us Saqib
Introduction
Pakistan is the sixth most populous country in the world and has the second largest Muslim population in the world after Indonesia. The country is listed among the "Next Eleven" economies. Pakistan has a population of 150 million and the highest population growth rate in South Asia. The country has made slow progress towards achieving its Millennium Development Goals, especially those for infant mortality, child malnutrition, and primary school enrollment. Its social sectors require more resources. Pakistan is a founding member of the Organisation of the Islamic Conference, South Asian Association for Regional Cooperation, Developing 8 Countries, G20 developing nations, Asia Cooperation Dialogue and the Economic Cooperation Organisation. It is also a member of the United Nations, Commonwealth of Nations, World Trade Organisation, Shanghai Cooperation Organisation, G33 developing countries, Group of 77 developing nations, major non-NATO ally of the United States and is a nuclear state.
The European Union (EU) is an economic and political union of 27 member states, located primarily in Europe. It was established by the Treaty of Maastricht on 1 November 1993, upon the foundations of the pre-existing European Economic Community. With a population of almost 500 million, the EU generates an estimated 30% share (US$18.4 trillion in 2008) of the nominal gross world product.
A common currency, the euro, has been adopted by sixteen member states constituting the Euro zone. The EU has developed a limited role in foreign policy, having representation at the WTO, G8 summits, and at the UN. It enacts legislation in justice and home affairs, including the abolition of passport controls between many member states which form part of the Schengen Area. Twenty-one EU countries are members of NATO.
Pakistan - EU Relations History
Pakistan is having a history of relations with different countries organizations, and also EU. Since the start of its cooperation with Pakistan in 1976, the Commission has committed more than €500 million to projects and programmes. During the 1980s the Commission launched a mix of infrastructure and social development projects which focused on development of roads, bridges, a fishing harbor facility rural electricity infrastructure, livestock, education, vocational training and integrated rural development.
In the 1990s the Commission streamlined and consolidated its portfolio and reoriented its activities towards policy-based social sector investment programmes, placing greater emphasis on human development and environmental management in line with shifts in government policy. In addition, the Commission provided support to smaller-scale operations with NGOs in areas such as population welfare, child labor, income generation, drug demand reduction and rural health. Under the previous CSP, the EC cooperation in Pakistan focused on human development, in particular basic education programmes at provincial level.
Since 2001, EU policy is to stay constructively and strongly engaged with Pakistan and to make a significant and visible engagement, both in political and economic terms. Measures include resumption and upgrading of political dialogue, signature of a 3rd Generation Co-operation Agreement, as well as additional development assistance. In December 2006 the Council of the EU called on Afghanistan and Pakistan to deepen relations and to cooperate closely to deal with insecurity in border areas, while urging Pakistan to build on current efforts to prevent the use of its territory by the Taliban. In order to enhance Pakistan’s capacity on WTO related issues, a trade-related technical assistance program was launched in 2004 with a view to streamlining procedures and processes for trade facilitation in compliance with EU norms and standards.
For the period 2002-2006 €75 million were originally allocated for development and economic cooperation. Additional EC support to Pakistan was provided following the events of 2001 in recognition of Pakistan’s role as a partner in the fight against terrorism, including € 50 million for financial service reforms and to support development of micro-finance SMEs.
The 8 October 2005 earthquake had a devastating effect on Northern Areas of Pakistan, in particular Azad Jammu and Kashmir and North West Frontier Province. In response to this calamity the Commission proposed an assistance package of € 93.6 million, consisting of both humanitarian aid (€ 43.6 million) and reconstruction support (€ 50 million) for commitment in 2005.Substantial assistance was also provided under other thematic budget lines, including for Afghan refugees in Pakistan.
Under its environment cooperation policy, over the last decade the EC contributed a total of € 32 million to rehabilitation, management and conservation of natural resources, safeguarding and conservation of biodiversity, education and capacity-building through sustainable resource management with the involvement of local communities. Major target areas included upland areas of Punjab, Khyber Pakhtunkhwa, benefiting more than 2 million people.
Political Relations of Pakistan - EU
EU Election Assistance & Observation
The promotion of democracy is a cornerstone of EU foreign and security policy. The EU supports democracy worldwide through a multitude of instruments including political dialogue with partner countries as well as technical and financial assistance. The EU contributes to the mechanics of democracy inter-alia through election observation and other election support. During the last decades the process of democratization has manifested itself in many countries by the holding of multiparty elections. In order to support the conduct of elections in accordance with international standards and best practices, the EU provides electoral support in many countries around the world and also to Pakistan.
Election observation
Election observation is a vital component of European Union activities to promote democracy, human rights and the rule of law worldwide. Election observation can contribute to strengthening democratic institutions, build public confidence in electoral processes and help deter fraud, intimidation and violence. Election observation also serves to reinforce other key European Union foreign policy objectives, notably peace-building. With these objectives in mind, and by adopting a rigorous specific methodology as outlined in the Commission Communication on Election Assistance and Observation of 2000 the European Union has become a leading force in international election observation.
Election observation, in particular long-term observation, as conducted in the framework of EU Election Observation Missions (EOMs), provide a specific opportunity for an election process to be assessed according to international standards and best practices for genuine democratic elections to worldwide countries including Pakistan. The international standards established by international and regional legal treaties and political commitments to which the Country observed has agreed to be bound include universal principles that apply to the conduct of elections, such as fundamental freedoms and political rights as outlined in the Universal Declaration of Human Rights and the International Covenant on Civil and Political Rights.
Election Support
The EU is one of the leading global actors in terms of providing and financing electoral assistance to Pakistan. In recent years there has been a significant increase in both the volume of funding and the complexity of electoral assistance support provided. Important complementarity exists between the objectives of electoral assistance and election observation. The European Commission is seeking to promote greater synergy between the two activities in Pakistan. Both, the evaluation of electoral assistance projects and the EOMs’ recommendations are taken into account for the benefit of future electoral assistance interventions. This dual form of EU election support constitutes a significant contribution to the promotion of governance and development objectives.
Economic Relations of Pakistan - EU
EU & PAKISTAN Relations 2004
The EU troika went to Islamabad on 18 February to meet President of Pakistan's foreign affairs, finance, trade and interior ministers for discussions on EU-Pakistan relations, the domestic political situation, the improvement in relations with India, Afghanistan and the fight against terrorism. During the visit, EU troika signed a financing agreement on trade-related technical assistance for Pakistan. On 29 April, the Council approved the conclusion of a cooperation agreement between the European Community and Pakistan which would allow the European Union to engage more closely with Pakistan on issues of bilateral, regional and international importance. An EU-Pakistan Joint Commission was to be established to oversee implementation of the agreement.
EU-Pakistan most important Trade Partners
The EU and Pakistan have strong trade ties with the EU being Pakistan's most important trading partner. The EU accounted for around 20% of Pakistan's total trade in 2007. EU-Pakistan trade has increased by almost 8% annually between 2003 and 2007. In order to further promote the development of two-way trade between the parties, the EU and Pakistan agreed in May 2007 to set up a Sub-Group on Trade under the auspices of the EU-Pakistan Joint Commission. Besides discussing trade policy developments more broadly, the Sub-Group is also aiming to tackle individual market access issues which hamper trade between the two parties.
Pakistan's Textile Sector and the EU
EU-Pakistan Trade (Textiles and Clothing) a large number of the European community use bed-linen supplied by Pakistan. In 2005, the South Asian economy was the largest supplier of bed-linen to the union (Aziz, 2006). The European Union (EU) is Pakistan's largest trading partner, with textiles and clothing (T&C) accounting for almost two thirds of its sales to the union (EC's Delegation to Pakistan, 2004). As in many close relationships, however, the EU also is the cause of a lot of worry to its partner. One example was the imposition of a punitive import duty on Pakistani bed-linen in 2004, accusing exporters of dumping bed-linen below cost prices at the European market. It is believed by some that this move was actually in reaction to Pakistan's upgrading its commercial air fleet with US-American Boeings rather than with European Airbuses.
Textiles and clothing dominate Pakistan's exports and still account for more than 70% of Pakistan's exports to the EU. In 2007, the EU imported textiles and clothing articles from Pakistan worth €2.6billion, of which around 80% entered the EU at a preferential tariff rate. Around a quarter of these imports were bed linen, table linen and toilet and kitchen linen. Despite the elimination of quotas on imports of Chinese textile and clothing products, Pakistani exports to the EU have constantly increased in terms of value. However, she relying so heavily on one product category also carries risks. Trade diversification programmes have therefore been launched to reduce Pakistan's reliance on the textiles and clothing sector.
Trade in goods
EU goods exports to Pakistan 2007: €3.8 billion
EU goods imports from Pakistan 2007: €3.4 billion
Textiles and clothing as well as leather products account for the majority of Pakistani exports while its imports from the EU mainly comprise mechanical and electrical machinery as well as chemical and pharmaceutical products.
Integration with the world Political Economy
In recent years, Pakistan has increasingly integrated with the global economy, leading to average real GDP growth rates of 7.3% between 2003 and 2007. In parallel, Pakistan has increased its trade with the rest of the world, with total trade rising to €40 billion in 2006. The EU supports this integration by granting Pakistan's exports to the EU reduced tariffs under the EU's Generalized System of Preferences. As a result, almost 20% of Pakistan's exports enter the EU at zero tariff and more than 70% at a preferential rate.
One area of EU financial assistance to Pakistan consists of a €3million assistance Program for the implementation of the South Asian Free Trade Area (SAFTA) which strives to eliminate barriers to trade between India, Nepal, Afghanistan, Bhutan, Bangladesh, Maldives, Sri-Lanka and Pakistan. The first phase of this liberalisation started in 2006. At a ministerial meeting in Berlin in February 2007, the EU and Pakistan fully recognized the importance of continuing this work together.
EU assistance 2007-2013
The overall aims of the European Commission’s support to Pakistan are to fight poverty and help the country towards sustainable growth. This will succeed only if growth is founded on political stability, social cohesion, the creation of productive and decent work opportunities, human and social development, the rule of law, and diversification of economic activity.
The EU-Pakistan Country Cooperation Strategy (2007-2013) sets out two main priority areas:
· Rural development and natural resources management in North West Frontier Province and Balochistan
· Education and human resources development
First priority,
Particular emphasis is on the deteriorating state of the environment and declining water resources. The objective is to improve livelihoods, income-generation and employment in rural communities, including those affected by refugees.
Second priority
Is to increase access to basic education and to help improve the quality of education and human-resource development in support of the country's goal of becoming a knowledge-based growth economy.Trade development, with a view to further integration of Pakistan into the world economy, human rights, and democratization are also to be funded. The multi-annual indicative Program (2007-2010) allocates €200 million to address these priorities.Commission programmes in Pakistan are designed to contribute towards these objectives in line with the targets set out by the Pakistani government in its five-year Medium-Term Development Framework and its Poverty Reduction Strategy Paper. Thematic and Asia-wide programmes also provide support to Pakistan.
Reference
Books
Ginsberg.H Roy," The European union in International Politics", Oxford England, Rowan. Little field Publisher, 2001
Armstrong, David. And Lloyd, Lorna, "International Organization in World Politics" third edition, Plagrave Macmillan, 2005
Siegmann.Karin Astrid, "Pakistan's Textile Sector and the EU", google.com
Chishti. Anwar and Muhammad Zulfiqar, "The impact of trade policies on Pakistan's preferential access to the European Union” University of Sussex United Kingdom
WEBSITES
WEBSITES
- http://ec.europa.eu/trade/issues/bilateral/countries/pakistan/index_en.htm
- http://ec.europa.eu/external_relations/pakistan/intro/index.htm.
- http://ec.europa.eu/transport/air_portal/international/index_en.htm
- http://ec.europa.eu/europeaid/where/asia/countrycooperation/pakistan/pakistan_en.htm
- http://www.issi.org.pk/journal/2002_files/no_3/article/6a.htm
- http://www.lankamission.org/content/view/1089/9/
- http://www.southasiaanalysis.org/papers6/paper564.html
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