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Overview for Pakistan's Strategic Trade Policy Framework 2009

by Guest3979 | 12 years, 9 month(s) ago

Overview for Pakistan's Strategic Trade Policy Framework 2009. Pakistan's exports durin g 2008-9 decreased to US$ 17.8 billion as
compared to US$ 19.1 billion during 2007-08. A target of US$ 22.2 billion
was set in the Trade Policy 2008-09, keeping in view the growth in exports
of 13% in the previous year. Export target could not be materialized on
account of many internal as well as external factors. On the external
account, economic downturn in our major markets i.e. USA and EU,
negative travel advisories and buyer's perception of Pakistan as a supplier
of low quality products played a significant role. Whereas, on the domestic
front, high cost of finance, power outrages, worsening law and order
situation, decline in foreign investment contributed to poor export
performance.
A review of sectoral performance of Pakistan's export profile during 2008-
9, reveals that the export of Textiles, accounting for around 54% of
Pakistan's total exports, dropped from US$ 10.6 billion to US$ 9.6 billion.
The major losers in this sector were Readymade Garments, which dropped
by 21.7%, Cotton Yarn dropped by 15%, Bed linen dropped by 10.2%, Art
Silk & Synthetic Textiles dropped by 22.1% and Cotton Fabrics dropped by
4.0%. The poor performance of all major categories in this sector can be
attributed to both price and quantity effects. Textile is a sector which has
experienced little or no growth in terms of international trade value during
the last few years. Secondly, buyers have become more demandingrequiring
more value for money, better quality, shorter delivery times,
improved services, enticing designs, lower prices and credit sales among
other things. These requirements have proved to be too demanding for
textile sector already encumbered with a multitude of productivity and
supply side problems. The textile industry is also facing stiff competition
from other regional competitors like India, China and Bangladesh.
Bangladesh, which is not a cotton producing country, has been able to
undercut Pakistan's share due to preferential market access granted by EU
and USA on account of it being an LDC.
The exports of finished leather and leather manufacturers also registered a
drop of 24.5 %, coming down from US$ 1.1 billion to US$ 0.84 billion.
Export of leather declined due to many internal as well as external factors.
On the demand side, this sector faced stiff competition from China, India
and Bangladesh grabbing around one-third of leather export share of
Pakistan due to the relief packages announced by their respective
governments to combat the global recession. On the domestic front, this
sector confronted with non-availability of quality leather, scarcity of
specialized leather technicians, lack of R & I) facilities and non- existence
of effluent treatment plants.
The export of Rice, however, registered an impressive growth from US$
1.84 billion to US$ 1.99; an increase of 8.2%. This performance can be
attributed to a number of factors which inter alia include; a large and
expanding market, surge in the international price of rice, which increased
on an average by 48.4% last year, business friendly policies of the
Government and investment made on plant modernization. Export of
engineering goods also registered an increase of 26.1% from US$ 211.3 to
US$ 266.4 million, the major contributors being the specialized machinery,
transport equipment and electric fans. The export ofJewelry also rose from
US$ 213.4 million to US$ 288.4 million, registering an increase of 35%.
FigureI below indicates share of major sectors in the total exports of
Pakistan.

Tags: 2009, framework, overview, pakistans, policy, Strategic, trade

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amomipais82

On 27 July 2009, the Pakistani Minister of Commerce unveiled the contours of the Strategic Trade Policy Framework for 2009 - 2012. According to the speech, the government seeks to expand Pakistan's export product range in the medium term. To do so, the government has identified certain promising sectors. These are said to be the nation's chemical sector, pharamaceuticals, meat and meat products, agro-processed exports, leather and leather products, the mineral sector, gems and jewlery and services.

Besides the short-term measures listed below, the government plans to set up a variety of funds to promot such goals as the channeling of public investment to promising sectors, hedge business against short- and medium-term interest rate risk as well as the improvement of management skills, product development and marketing.

The following measures may affect international commerce:
To strenghten export competitiveness, the government seeks to compensate inland freight cost to exporters of "cement, light engineering, leather garments, furniture, soda ash, hydrogen peroxide, sanitary wares including tiles, finished marble/ granite/ onyx products."
To help designated sectors receive higher prices for their goods, the government will support brand development activities for "surgical instruments, sports goods & cutlery" with grants worth 25 percent of cost.
To support the textile industry, import duties on sizing chemicals may be abolished.
To promote the export of live sea food, the government has decided to grant 25 percent of freight cost to such products exported by air.
To support exports of processed foods, the government wants to compensate exporters partially for necessary research and development investments. This reimbursement could amount to 6 percent of export value.
To allow its exporters to enter Muslim markets, the government plans to set up a Halal Certification Board. The cost of certification shall be subsidised with up to 50 percent of expenditure.
To increase international market access for electrical appliances, the government decided to bear half the cost of certification through Underwriters Laboratories.
In an attempt to increase overall competitiveness, the government promised to "zero rate" exports completely. As the elaboration of such a measure will take time, the government has decided to provide "interim relief to the sectors of tents & canvas, electric machinery, carpets, rugs and mats, sports goods, footwear, surgical/ medical/ veterinary/ beauty care instruments, cutlery, onyx products, electric fans, furniture, auto parts, handicrafts, jewelry and pharmaceuticals."
To reduce the cost of doing business in Pakistan, the government will ease import restrictions on designated specialized machinery, transport equipment as well as spare parts in the construction, waste disposal, oil and petroleum industry.
To allow improved development of pharmaceutical and engineering services, the government plans to ease export restrictions on the industries.
To provide lower income citizens with computers, the government has decided to allow the import of used computers. However, to allow for the development of a national television industry, used cathode ray tube monitors may only be imported along with used computers.
To encourage local vaccine production, the government plans to restrict imports to World Health Organization-approved plants only.
Report (0) (0) | 12 years, 9 month(s) ago
Guest5529

The erosion of competitiveness of Pakistan’s traditional exports in general and the country’s weakness in diversifying its product and market mix are the principle reasons for this lethargic performance in exports,.
Pakistan’s exports stood at $17.78 billion during the outgoing fiscal year against the target of $22.1 billion. In 2007-08, exports had touched the $19.05 billion mark. The ministry has set the export growth target of 6 per cent for 2009-10 and 10 and 13 per cent for each successive year,
To provide finance at fixed interest rates for short to medium term either by private or public sector, a fund to hedge mark-up rate hikes will be set up. In order to ensure predictability of electricity supply, the minister said, the Ministry of Water and Power and the electricity distribution companies would enter into agreements with clusters of industries and electricity would be supplied at mutually agreed times. The agreements would have punitive and compensation clauses and the compensation could be in the form of electricity charges credit, he added.
The government has decided to launch a scheme for picking up the full cover for Pakistan for their valid insurance policies. The scheme will be funded from the Export Investment Support Fund and managed by the National Insurance Corporation, the minister said.
The minister further announced that a scheme
Report (0) (0) | 12 years, 9 month(s) ago