In Pakistan, smartphone market feels impact of rupee fall

Chinese firm considers setting up smartphone manufacturing facility in Pakistan

Shahram Haq September 18, 2019

LAHORE: A Chinese smartphone company is considering setting up a smartphone manufacturing facility in Pakistan and the plan is currently under discussion at the company’s top level.

In a briefing to journalists, an official of Oppo Mobile Telecommunications revealed that the matter was being considered by the company’s top executives because of higher taxation and increasing fluctuation of the exchange rate in Pakistan.

Nevertheless, the leading position of the Chinese smartphone brand in Pakistan in the second and third quarters of the current calendar year was paving the way for new investment, he said.

“Currently, the plan is at the initial stage, we as a company will be proud to announce such development, which is expected soon, however, any final news about the manufacturing facility will be revealed by our CEO,” said Oppo Pakistan Marketing Director Ali Kakvi. “The plan will be viable for Pakistani market as it will help offset increasing prices of handsets in Pakistan,” he added.

According to Canalys, a global technology analysis firm, the company managed to win 27% and 25% market share in Pakistan in June and July 2019 respectively, beating Samsung, which had 23% and 19% market share in June and July respectively.

These two brands were followed by Huawei and Vivo, with the former capturing 3% and 15% share in June and July respectively while the latter’s share was 10% and 13% respectively. As per the global analysis firm, the demand for smartphones in Pakistan has been on the decline for the past year. In the first quarter of 2018, Pakistan imported around 1.1 million smartphones, which at the start of the third quarter of 2019 dropped to 0.7 million units.

Kakvi said the rupee devaluation had a major impact due to which the price range for many handsets, which were previously selling like hotcakes, had changed, pushing consumers to opt for cheaper or some other brand’s handsets that fell within their price range.

“Prices of handsets, which were previously below $200, have now reached in the range of $250 to $300,” he said. The official said given the current economic situation in Pakistan, it had been noticed that the income of consumers was not increasing, which led to a decrease in their purchasing power.

“Inflation is high, so the customers’ choice is changing. Since March this year, we as a company have taken the hit of rupee devaluation.”

Published in The Express Tribune, September 18th, 2019.

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