US China trade war: A hidden blessing for Pakistan
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ISLAMABAD -
Pakistan may emerge out to be victorious in the ongoing trade war between China and United States. Pakistan is likely to reduce the trade deficit in the wake of opportunities emerging due to the US-China trade war.
The two biggest economies of the world have made 62% ($360 billion) of bilateral trade expensive by slapping additional tariffs on thousands of each other’s goods since July 2018 and have caused a slowdown in the global economy, according to the State Bank of Pakistan (SBP).
“For Pakistan, the imposition of these cross-tariffs offers some interesting opportunities as well as challenges.
On a positive note, key food items, such as rice, seafood and soybean (both seeds and oil), have come in the crosshairs, which offer an opportunity to Pakistan to reduce its trade deficit,” the SBP said in its first-quarter report on the state of economy for fiscal year 2018-19.
Among the thousands of goods on which additional tariffs have been imposed by the two countries, three product categories may provide benefit to Pakistan’s exports which are seafood, rice and cotton (raw cotton, fabric and yarn).
“Specifically, American seafood exports to China are now much costlier as a result of the tariffs, as are Chinese exports of rice and cotton items to the US,” the central bank said.
