On both of my GT's, there is a lever on top of the transmission that allows it to freewheel in case the engine dies and you need to push/tow it.
Does the GT16 have this lever, and if so, is it in the down position? By now you have probably ruled this out, but just in case...
Scratch that. I just looked more closely at your picture, and now I see the lever (didn't see it at first). It's clearly in the down position.
But this leads me to another question. Is it possible that whatever valve you are actuating with that lever is stuck in the free wheel position?