Karachi, April 26, 2019 (PPI-OT): China is known as the supplier of the world with huge current account surpluses with most trading partners. After the first phase of PAK China FTA, we had to impose up to 30% regulatory duty to save the local industry from closing down. Even after the imposition of 30% regulatory duty, trade deficit from China is over USD 15bn with Pakistan exporting under USD 3bn worth of goods to China, mostly minerals, agricultural products, and livestock.
It is extremely unlikely for Pakistan to benefit from the 2nd phase of Pak China FTA as Chinese imports of USD 2 trillion are either of raw materials or high-tech equipment. Pakistan does not have the industrial and technical base to produce high-tech equipment such as computers, ICs, telecommunication equipment and automobiles.
Moreover, exports of minerals, livestock and agricultural products is not accelerated by FTAs as importing countries do not apply duties on raw materials. In view of the above ground realities, it would be interesting to see in which areas Ministry of Commerce has envisioned growth of Pakistan’s exports to China. If exports to China are expected to grow to USD 6bn after the 2nd phase of FTA, an item wise break up in which exports are expected to jump should be shared with the industry for their comments. In the absence of such a detailed effort duly endorsed by leading chambers, it seems that we are all set to shoot ourselves in the foot again.
For more information, contact:
Secretary General,
S.I.T.E. Association of Industry
H-16, Textile Avenue, SITE, Karachi, Pakistan
Tel: +92-21-32562883, +92-21-32560705
Fax: +92-21-32560704
E-mail: site@site-association.org
Website: www.site-association.org