The European Union has extended the Generalised System of Preferences (GSP) Plus status for cash-strapped Pakistan for two years, allowing the country access to preferential duties on exports to the EU, according to a media report.
The GSP allows vulnerable developing countries to pay fewer or no duties on exports to the EU, giving them vital access to the EU market and contributing to their growth.
The move comes at a time when Pakistan is facing serious economic crisis with short supplies of foreign currency reserves and stagnating growth in recent years.
Since assuming power in August 2018, Pakistan Prime Minister Imran Khan has been appealing to close allies like China and Saudi Arabia to provide loans at lower rates to overcome the financial woes.
According to a report in the Dawn newspaper, the International Trade (INTA) Committee of the EU Parliament extended the GSP-Plus status of the country for the next two years.
The GSP-Plus facility was available to Pakistan since January 2014, the report said.
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Pakistan's first biennial assessment of GSP-Plus was conducted in 2016, followed by another assessment in February 2018, while the third biennial assessment report was published by the European Commission on February 10 this year, it said.
The third biennial assessment report was discussed by the INTA on February 19 and by the GSP Working Party of the European Council a week later.
The European Commission and External Action Service recommended at both the forums to continue the country's GSP-Plus scheme.
Reacting to the development, Pakistan's Ministry of Commerce in a statement hoped that the country's "business community will capitalise further on this trade enhancement opportunity".