As part of a new round of revisions to its Generalised Scheme of Tariff Preferences (GSP), the European Union has admitted Pakistan to a small group of countries that benefit from additional import concessions. As a result, from January 1 2002 all imports of footwear from the country into the Union will be zero rated for duty.

Though granted nominally for the progress made by Pakistan in tackling the production of illegal drugs, the concession is also being linked to its support of the international coalition against terrorism, giving the country the same ‘anti-drugs’ status within the EU as countries such as Bolivia and Columbia.

However, the same cut in duty does not apply to leather and textiles which will continue to attract the full rate of duty.  This is because both industries have been deemed by the EU not to require the same level of assistance as the footwear sector. Up until December 31, Pakistan-produced footwear will continue to attract a 30% discount on the established flat rate.