Asia Bibi was sentenced to death for blasphemy in 2010, accused of insulting the Islamic prophet Muhammad, something she denies. She appealed the sentence but the hearing was postponed and she has been in prison ever since.
Jan Figel, the EU's special envoy for freedom of religion outside the EU, has told Pakistan that the renewal of their export privileges will be dependent on the freedom of Asia Bibi.
Pakistan currently have 'Generalised System of Preferences (GPS) status', meaning Pakistani products have duty-free access to the EU market with either no tariffs or preferential levies.
They have had this since 2013 and the prime minister of Pakistan at the time, Nawaz Sharif, said: "gaining access to European markets was the top most priority of the government".
Asia Bibi's daughter has campaigned for her mother's release.
However, the EU said the result of Bibi's appeal, which is pending in the Supreme Court and could result in her being sentenced to hanging, will determine the continuity of this trade deal.
It said in a statement: "The cessation of GSP plus status will cause a severe blow to the sinking economy of the country and will not be able to compete with local competitors like Bangladesh and Sri Lanka."
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