US agrees to provide preferential market access to Pakistan

[Neo]

US agrees to provide preferential market access to Pakistan​

ISLAMABAD: United States has agreed to consider Pakistan’s demand for allowing market access on preferences to compensate trade losses due to war on terror as well as forming long-term partnership for promotion of bilateral trade, Salman Ghani, Federal Secretary Commerce informed here on Monday.

At the conclusion of the meeting of advisory council held to solicit proposals from trade bodies for finalising Trade Policy 2009-12, Secretary Commerce informed that during the recent visit of US issues related to trade and Reconstruction Opportunity Zones (ROZs) were discussed at length.

He said that Pakistan has demanded US to allow immediate market access to compensate trade losses the country has sustained due to the war on terror. The US authorities have not expressed any denial to the Pakistani demand. Both sides have agreed to form a Joint Study Group to workout modalities of market access on preferences long-term partnership for promotion of bilateral trade. He said that Joint Study Group is expected to be formed next month representation from both sides. He informed that the export target of $22.1 billion was too ambitious as the world trade, according to the World Trade Organization’s figure, is growing by 6 percent and our export target envisages 15 percent growth. Its now difficult to achieve this ambitious export target in ongoing fiscal year and exports are likely to be at the level of last fiscal, he added.

Explaining the reasons of low growth in exports, secretary informed that demand is shrinking world wide due to the low credit demand and financial crisis especially in US and European Union, which are the major trading partners of Pakistan. He said that as per past practice the Ministry of Commerce would submit its tariff proposals to Federal Board of Revenue in a meeting to be held next week. MoC want tariff rationalisation and more liberalised trade regime in the country, as the current tariff structure is not enhancing exports.

He said MoC has decided to prepare Trade Policy Framework for the next three years based on medium-term initiatives. To finalise the proposals, the ministry has decided to hold detailed discussion with its all stakeholders. After the advisory council’s meeting the MoC would hold separate meeting with all major exporters associations in the head offices to complete this process during June so that a policy with its implementation strategy that would also be finalised in consultation with stakeholders. sajid chaudhry

 

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Pakistan 2009 growth will be slowest in decade
(AFP)


20 May 2009
KARACHI - Pakistan’s economic growth for the fiscal year ending June 30 will be the slowest in more than a decade, beset by the global recession and a manufacturing slump, officials and analysts say.

Gross domestic product (GDP) will slow to 2.37 percent, Pakistan’s National Accounts Committee recently estimated, revising downwards the year’s target growth of 2.5 percent.

But a senior finance ministry official warned GDP could be as little as 2.1 percent, saying the committee did not take into account the plummeting fortunes of the manufacturing sector.

“The accounts committee will calculate it again while considering the manufacturing sector’s growth and all other things,” the official told AFP on condition of anonymity because he was not authorised to speak to the media.

Either way, it will be the worst recorded GDP growth since financial year 1997-98 when the State Bank of Pakistan put the rate at 1.9 percent.

The bleak economic news comes with the military bogged down in an offensive against the Taliban in the country’s northwest, under huge US pressure to crush militants whom Washington has branded the greatest terror threat to the West.

Financial analysts said this year’s major disappointment was the hefty manufacturing sector, which has shrunk 5.73 percent so far this fiscal year.

“We believe the full-year, revised GDP will look even worse because hopes for industrial sector recovery are bleak due to power cuts and lower domestic demand,” said Muzammil Aslam of JS Research.

“This year’s growth rate would be the lowest since 1998, while the manufacturing sector could achieve a double-digit negative growth,” Aslam said.

The National Accounts Committee said the industrial sector had declined 2.57 percent this fiscal year.

Construction flopped a whopping 10.79 percent, while the finance and insurance sector declined 1.19 percent, said the National Accounts Committee.

Investment income from abroad declined to 65.6 billion rupees (810 million dollars) from 100.05 billion rupees last year, the committee said.

Economists believe Pakistan is struggling from the global economic downturn and stubborn inflation hovering around the 19 percent mark.

“Pakistan’s economy is in deep recession — partly because of the global slowdown and partly for its own economic troubles,” said Rauf Nizamani, an independent economist.

“Food prices in Pakistan are high as the government has fixed higher support prices for commodities that don’t allow inflation to decline,” Nizamani said.

He said single-digit inflation was now impossible by the end of the current financial year, in six weeks’ time.

Aslam hoped next year could bring better prospects for the nuclear-armed nation, which the United States has put at the heart of its global fight against Al-Qaeda.

“We expect improved liquidity, higher government spending and lower inflationary expectations on the back of a bumper wheat crop and expected reduction in oil prices next year,” he said.

The International Monetary Fund in November approved a 7.6-billion-dollar loan to help Pakistan avoid a looming balance of payment crisis.

International donors in Tokyo last month pledged more than five billion dollars to stabilise Pakistan, which has since been flung into a humanitarian crisis with 1.45 million people displaced from the anti-Taliban offensive.