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Pakistan's new trade policy eyes US$100b exports

Publication Date : 01-08-2012

 

The ministry of commerce of Pakistan yesterday unveiled basic architecture of the proposed strategic trade policy framework (2012-15) to increase country’s exports to US$100 billion in the next three years.

The new framework, which is being finalised in consultation with all stakeholders, has come up with a new idea among others of projecting export target for three years instead of the earlier practice of the annual target.

The draft policy was discussed in the 63rd meeting of ministry of commerce advisory council in Islamabad yesterday.

Commerce Minister Amin Fahim, Secretary of Commerce Munir Qureshi,  Federation of Pakistan Chambers of Commerce & Industry (FPCCI) president and representatives of major chambers and associations attended the meeting.

The proposed trade policy focuses on 12 areas to improve export promotion from the country.

The new policy will focus on revising the Export Policy Order and Import Policy Order to address issues of overlapping and redundancies in these regulations and to simplify them for facilitating the business community. The issues related to quality, standards, regulations, trade disputes and enforcement will be tackled on priority.

The ministry would introduce many initiatives during the next policy cycle to promote exports of agro-processed products, especially in the region.

The new policy will introduce many schemes to exploit potential of exports, such as Balochistan, KP, Gilgit Baltistan and interior of Sindh.

These regions have comparative advantages in many products but due to disadvantages, such as under-developed processing facilities, poor trade facilitation, lower level of access capital and technology the export potential of these regions is far less exploited.

Promotion of services sector: The ministry of commerce has a plan to establish suitable institutional arrangements for doubling export of services from Pakistan during the next three years.

The contribution of services sector in Pakistan economy is around 54 per cent. But market share in the global trade of services is dismal.

The regional trade would be one of the major policy objectives in the next three years. The new policy will give high priority to China, Iran and Afghanistan. Certain initiatives will be taken to double exports to these countries.

The ministry of commerce is in the process of developing exclusive setups for three export promotion agencies in the country.

Special incentives would be announced in the policy to encourage investment in the export oriented industries.

Investment will also be encouraged in special economic zones.

To ensure implementation of the trade policy initiatives, the ministry of finance will be engaged to enhance the funding allocated under Export Investment Support Fund and release it early in the year.

On the other hand, at the ministry of commerce, will put in place an integrated resource management system to address the issue of lack of integration amongst different streams of resources for promotion of exports, such as Export Investment Support Fund from the regular budget, Export Development Funds, PSDP funds and donor’s assistance.

Market diversification and product diversification are rather old concepts but still remain highly relevant. The new plan focuses on introducing a number of initiatives for increasing exports to Asia from 46 per cent to 60 per cent during the next three years.

Trade Facilitation: Trade facilitation plays an exceedingly important part in making a country more competitive. Pakistan is one of those rare countries where exporting is more expensive than importing.

The ministry attaches high priority to this aspect and would ensure that at the end of three years, exporting is less expensive than importing.

Trade diplomacy

Successful trade diplomacy remains extremely important to assure a level playing field for our exporters and build special trade relations with some promising markets.

Pakistan has signed many FTAs in the recent past, but their effective implementation needs to be looked at afresh.

With the help of the relevant ministries, the ministry of commerce would put in place systems and mechanisms where Pakistan could detect pressures coming on certain sectors early enough either due to FTA commitments or due to unfair support by our competitors and prepare our industry to adjust to such situations in an effective manner.

Director-General Trade Policy Office, ministry of commerce, Dr Safdar Sohail evolved the proposed policy in consultation with stakeholders.

 

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