Nine new trade missions planned abroad
PHOTO: FILE
Pakistan has decided to establish nine new trade missions in Africa, Europe and Asia in an effort to boost trade with these regions as exports of the country have remained stagnant at around $25 billion, though its peers have gone far ahead.
Pakistan has not been able to enhance exports since decades owing to the failure of its trade missions abroad to promote the country’s goods and the inconsistent domestic policies. Sources told The Express Tribune that the government would require an annual budget of Rs70 million for setting up the new trade missions.
The current Pakistan Muslim League-Nawaz (PML-N)-led government will allocate these funds in the next budget for fiscal year 2024-25. According to officials of the commerce ministry, two new trade missions each will be set up in Africa and Europe. Apart from these, five trade missions will be established in Asia.
They said the Special Investment Facilitation Council (SIFC) had accorded formal approval to the plan. It also gave the green light, in principle, for the required cost and directed the Ministry of Commerce to seek the allocation of funds in the FY25 budget.
The setting up of new missions is apparently part of the “Look Africa” policy being pursued by Pakistan to enhance trade. Earlier, the Pakistan Tehreek-e-Insaf (PTI) government too had been advocating a similar policy in an attempt to tap the vast market of South Africa valuing at $100 billion.
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Pakistan’s share in this $100 billion market is negligible. Exporters have traditionally focused on the Middle Eastern, United States and European markets. However, there is a lot of potential in the South African market, which can help Pakistan to increase its stagnant exports.
Pakistan’s trade with the African continent had been stagnant at $3 billion per annum over the past few years. However, it crossed the $4 billion mark and reached $4.18 billion in fiscal year 2019-20.
According to officials, the key reason for the thin trade volume was the lack of engagement between Pakistan and Africa. To boost its market share in African nations, the Ministry of Commerce had launched the “Look Africa” policy in August 2017.
Commerce ministry officials say that the establishment of two new trade missions will help raise the level of engagement between Pakistan and Africa. The missions will work as a bridge between Pakistani and African traders.
In the case of Europe, Pakistan has been enjoying the GSP Plus status for around 10 years, which gave a boost to export volumes. European countries have granted duty incentives of $1 billion to Pakistan.
The setting up of two new trade missions in Europe is part of the government policy to deepen its engagement with European states to grab a larger slice of the huge market.
Central Asia is a market that has long been neglected by Pakistani exporters. On the other hand, Indian lobby is very active in Central Asia, allegedly working to undermine the influence of Pakistan there.
During the previous PML-N government, former prime minister Nawaz Sharif increasingly focused on exploring the new Central Asian market. He was keen to sign a free trade agreement with the Eurasian Economic Union (EEU) – the Russia-dominated bloc, and even visited many countries in the region. EEU comprises Belarus, Kazakhstan, Russia, Armenia and Kyrgyzstan. However, Pakistan has no diplomatic relations with Armenia, which is why it has not been able to sign the free trade deal.
Published in The Express Tribune, March 17th, 2024.
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