Tariff list: China not willing to exclude more than 10% items

Pakistan wants at least 20% products to be excluded.

ISLAMABAD: China is not ready to exclude more than 10% of the total products on the overall tariff list against Pakistan’s demand of 20% under the proposed second phase of the China-Pakistan Free Trade Agreement (CPFTA).

Currently, negotiations are under way to make the CPFTA work in Pakistan’s favour during the sixth round of discussions of the second phase. Pakistan feels that the first phase of the agreement was tilted towards China and was hurting Pakistani products.

“The Pakistani side requested Chinese authorities to enhance the exclusion percentage of Pakistani products to 20% of the total tariff line,” said a senior official of the Ministry of Commerce. “In response, the Chinese side insisted that exclusion percentage of total tariff lines of Pakistani products could be no more than 10%, in accordance with the consensus reached by both parties during the first phase of the CPTFA.”

According to the official, Pakistan’s understanding is that China would give more concession in comparison to what the former gives the latter.

Pakistan takes the principle of the first phase to be independent of the second phase and expects certain articles of the current CPFTA to be reviewed and modified, while China thinks that as per CPFTA, adjustments of tariff lines in the second phase can only be done by further liberalisation of tariffs.

“During the negotiations, the Chinese side expressed its concern on the regulatory duty levied by the Pakistani government,” said the official.

The Chinese side pointed out that the duty was inconsistent with CPFTA and requested Pakistan to remove it on all Chinese products exported to Pakistan.

In response, the Pakistani delegation clarified that duty had been imposed on MFN basis and comparative advantage still existed for all Chinese imports vis-à-vis others.

Published in The Express Tribune, November 25^th, 2015.

Like Business on Facebook, follow @TribuneBiz on Twitter to stay informed and join in the conversation.