Pakistan Trade Deficit: How to overcome imbalance
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LAHORE, June 11 (APP): Pakistan Trade Deficit: How to overcome imbalance
Lahore Chamber of Commerce and Indusry (LCCI) on Saturday called for taking comprehensive measures to overcome trade imbalance.
LCCI President Sheikh Muhammad Arshad, in a statement here, said economic situation had improved a lot when compared to previous tears but extra measures were needed to be taken to expedite growth.
He said a few events took place at global level in favour of developing countries, including Pakistan, like tremendous cut in oil prices but still the country's trade deficit existed during the current financial year.
China, he said, had emerged as Pakistan's biggest trading partner. During the last couple of years, Pakistan witnessed huge trade deficit with China, India, United Arab Emirates, Saudi Arabia and Malaysia, while recorded trade surplus with only a few countries likethe United States, the United Kingdom, Afghanistan and Germany.
Sheikh Arshad said trade deficit always pressurized the economy and forced the country to depend on borrowing which ultimately gave birth to various economic worries.
He said it was concerning that Pakistan's exports remained below the par despite having all sorts of mineral and human resources. Though a number of factors. including high input cost, energy shortage and refund claims, had played a role in this regard but most important one was dependency on a few products and few markets for exports, he added.
Sheikh Arshad said Pakistan's most favorite export markets had been Europe, North America and Gulf, asserting that exporters needed to look for new markets in Central Asia, Africa and Indonesia. He said the Central Asian Republics had on the whole over $ 65 billion imports whereas Pakistan's exports were negligible.
He viewed, "Trade within the region is being governed by multilateral treaty such as SAFTA (South Asia Free Trade Agreement). It is advisable to use bilateral mechanism for trade such as FTAs (Free Trade Agreements) with most of the countries. India for instance has reached billion dollar export figure to Pakistan under SAFTA, whereas Pakistani exports have faced non-tariff barriers since the very inception of the trade. Only a bilateral agreement can control such issues more effectively."
The LCCI President said that Pakistan should particularly sign Free Trade Agreements with Central Asian Republics and the countries in Gulf and also in South such as Indonesia and Malaysia.
