Second phase of talks under free trade deal begins with Beijing. STOCK IMAGE
ISLAMABAD:
As the second phase of talks began under the China-Pakistan Free Trade Agreement, Pakistan would resist the demand for more tariff concessions after its many industries became uncompetitive due to the relaxation given in the first round of talks.
The free trade agreement that came into force in 2006 has kept the balance of trade in favour of China while Pakistan could not fully enjoy the preferential treatment due to Beijing’s similar trade agreements with Asia-Pacific countries.
After the first phase, China desired that Pakistan should implement the second phase that would allow its exporters concessions of up to 90% of total tariff lines, said an official of the Ministry of Commerce, who was part of the negotiations.
He said Pakistan would prefer to invoke Article 8 of the treaty under which tariff reduction would be offered on selected product lines instead of general concession on all imports.
If Pakistan implements the second phase, as desired by China, its textile sector will become uncompetitive. Many industries have already been wiped out over the last six years as domestic markets are flooded with cheap and low-quality Chinese products. As a result, the balance of trade has heavily been in China’s favour.
Furthermore, there is difference of opinion over the size of bilateral trade. The volume is said to be in the range of $10 billion to $14 billion as Pakistani importers show a lower value of their goods in an attempt to evade taxes and duties.
The first round of three-day talks between Pakistan and China was held on Tuesday to assess the developments that had taken place in the wake of the FTA and propose necessary changes for the benefit of the two countries. Pakistan is expected to adopt a tough stance in order to avoid further damage to the economy from free trade.
This was the third meeting of the second phase of negotiations in which Pakistan’s delegation was headed by Ministry of Commerce Additional Secretary Robina Ather and accompanied by officials of the Federal Board of Revenue, Ministry of Industries, Ministry of Textile Industry and Ministry of National Food Security and Research.
A 10-member Chinese delegation was headed by Yao Wenliang, Deputy Director General of the Ministry of Commerce.
Pakistan expressed concern over the dilution of the margin of preference due to China’s free trade accords with other countries, especially members of the Asean grouping, according to a handout issued by the ministry.
It added the cost of exemption that the national exchequer had to bear due to the tariff concessions also came under discussion. Pakistan conveyed concerns of the domestic industry, which had to compete with Chinese products despite a persistent energy crisis in the country.
The Ministry of Commerce also voiced concern over insufficient utilisation of the facilities provided under free trade in which only a few sectors had been able to reap the fruits of preferential tariffs.
Pakistan emphasised the importance of broadening the export base by encouraging exports from all sectors, which were covered under free trade and sought to enhance facilities and concessions on high value-added products.
Both sides agreed that the concerns of each other would be taken into consideration with a thorough review of the FTA provisions and the possibility of readjustment.
Published in The Express Tribune, January 7th, 2015.
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European Union (EU) granted GSP status to Pakistan in DEC-2013; there has been 20% increase Pakistan’s exports to EU. Pakistan will enjoy this status up to 2017.Volume of trade between Pakistan and EU up to Jan-2014 was $10.9 billion and it was in Pakistan’s favor, with surplus of $1.78 billion. No doubt, Pakistan and china have been tied in historic friendly relation; the volume of bilateral trade is not so commendable. Pakistan signed FTA with China in 2006-07 when total volume of bilateral trade was $4.1 billion, which was mostly in favor of China; Pakistan’ s total export to China were $0.6bn and Pakistan’s Imports were $3.5bn with bilateral trade deficit of $2.9bn. After they have signed the FTA, the bilateral trade-deficit increased to $4bn, Pakistan exported $2.6bn goods and imported $6.6bn. Any further reduction in tariff will deteriorate the terms of trade
China is very good friend of Pakistan and every Pakistani thinks very highly about China. Enemies of Pakistan and enemies of China are making continuous efforts to disturb this relationship, but both China and Pakistan know the importance of this relationship. China's 'gift' of 3 Z-10 helicopters to Pakistan 2015-01-07 Want China Times China's alleged decision to present Pakistan three Z-10 attack helicopters as a "gift" this year has raised suspicions of ulterior motives, says Duowei News, a US-based Chinese political news outlet. Even if the reports of the gift are true, Duowei said, the new Z-10 helicopters will only enhance Pakistan's position against India, which is about to pair its domestically produced light combat helicopters with newly imported AH-64 Apache attack helicopters manufactured by Boeing. Though there is still a sizable gap between the power systems of Z-10s and Apaches, the Chinese aircraft's body design and weapon system configurations are comparable to the world's most advanced attack helicopters, especially because of the excellent performance of its TY-90 air-to-air missiles. For China, the "gift" to Pakistan could serve as a gift for the givers as well, as it might allow the PLA to see how the Z-10s perform in actual combat situations, providing valuable data for further research and development, Duowei said. China may have already been collecting information on its domestically produced weaponry acquired by Pakistan in recent years, including the MBT-3000 battle tank, the JF-17 Thunder combat aircraft and the F-22P general purpose frigate. The decision to make the Z-10s a gift instead of selling them could therefore stem from Pakistan's limited defense budget and China's relatively robust arms industry, Duowei added.
Pakistan wants quality products from America, like F-22 and F-35. ET, kindly use your influence to convince American that Pakistan want quality products.
How rude to say we have been flooded with cheap and low quality goods, where is the evidence for this ?
China ensures we exist, in time we will be a province of China in all but name, but that is no bad thing compared to path we are going down.
Obviously Banning hajibs and Ramadan is not going to work straight away, but the social order and economic growth will make us a super power/province.