In a strategic move to promote sustainable economic growth and strengthen the business environment in Pakistan, the European Union and the Government of Pakistan have signed a €20 million grant financing agreement to launch the Better Governance and Business Environment initiative.
The agreement, signed by EU Ambassador to Pakistan Dr. Riina Kionka and Secretary of the Economic Affairs Division Dr. Kazim Niaz, represents a renewed partnership to improve governance frameworks and drive private sector competitiveness with a focus on small and medium-sized enterprises (SMEs), including those owned or led by women.
Focus on Private Sector Competitiveness and Sustainability
Funded under the EU’s Multiannual Indicative Program 2021–2027, the initiative aims to enhance the competitiveness of Pakistan’s private sector. Key focus areas include strengthening SME-related legislation, supporting the green transition of export-oriented firms, facilitating targeted green investments, and promoting public-private dialogue.
The program is aligned with several flagship EU strategies and priorities, including the EU’s Global Gateway, GSP+ commitments, and the EU Green Deal and is designed to promote smart, sustainable investment and resilient value chains in Pakistan’s economy.
High-Level Commitment
Speaking at the signing ceremony, Dr. Kazim Niaz expressed appreciation for the EU’s continued engagement: He emphasized the “timely nature of the intervention, highlighting its strong alignment with Uraan Pakistan’s goals for private sector development and institutional reform to attract responsible investment.”
On behalf of the EU, Ambassador Dr. Riina Kionka emphasized the strategic vision behind the grant: “This agreement underscores the EU’s commitment to supporting Pakistan in building a resilient, inclusive, and competitive economy. We are investing in green innovation, women-led businesses, and public-private partnerships to ensure a more sustainable future for all Pakistanis.”
Advancing Shared Priorities for Sustainable Growth
The “Better Governance and Business Environment” initiative reflects the EU’s broader focus on climate resilience, human rights, and inclusive economic development in Pakistan. The programme is expected to unlock critical reforms and investment opportunities that will benefit a wide spectrum of stakeholders in the country’s business ecosystem.
As Pakistan seeks to modernize its economy and expand trade opportunities, especially under the GSP+ framework, this collaboration signals strong international support for sustainable reforms and inclusive enterprise development.