KARACHI: Former finance minister and senior economist Dr Hafeez Pasha has said that it is not possible to compete with the European market when your currency is 16% stronger than the European counterpart, urging the government to focus on increasing exports by making them cheaper.
He was invited as the keynote speaker at a consultation session titled, ‘Two Years of GSP plus Status : A Stakeholders’ Review of the Conventions’ Implementation’ organised by Pakistan Institute of Labour Education and Research (PILER) at Jahangir Siddique Auditorium at IBA City Campus, Karachi.
According to Pasha, depreciation of Pakistani rupee is important to increase exports to the leading markets of the world.
“There is no doubt imports reap a lot of profit, but we should move towards a production-based economy that will cause an increase in employment and increase in the export sector of the country.
“Although Turkey is the main competitor of Pakistan in the European market due to its historical relations with Europe, we cannot ignore the fact that Turkey’s currency- Lira-has deprecated 40% against European currency.”
Pasha pointed out that the stronger currency has caused a decline in exports. “During the two years of the GSP plus scheme, Pakistani exports to Europe have increased. But the increase in the second year has been far less than the first.”
While commenting on the privatisation of Pakistan International Airlines (PIA), Pasha appreciated the carrier’s labour unions, which took a stand against the privatisation of the national asset.
“Air India incurs more loss than PIA but they never talk about privatising their airline.”
Published in The Express Tribune, January 13th, 2016.