The Advisor to the Prime Minister on Commerce and Investment, Abdul RazakDawood, held a consultative meeting at the Ministry of Commerce (MOC) todiscuss Pakistan’s Global Trade in Services for the First Half of theFinancial Year (FY) 2020-21
The advisor was apprised at the meeting that was attended by the ministryofficials that during the period July to December 2020, Pakistan’s totalexports of services stood at $2.844 billion as compared to $2.835 billionduring the same period last year. He was told that the imports of serviceshad declined by 15.7 percent to $3.821 billion from July to December 2020as compared to July to December of 2019.——————————
In the Insurance & Pension services that had increased by 21 percent, theFinancial Services by 26 percent, the Telecommunication & ICT services by40 percent, and the Other Business Services (like Consultancies) by twopercent.
Furthermore, he was notified that the exports of the Travel and TransportServices had been adversely affected by the pandemic and had declined by 28percent and 18 percent respectively.
However, these sectors are likely to improve after the pandemic subsides.
Dawood acknowledged with satisfaction that Pakistan’s services exports hadfinally turned around during July and December 2020 and had startedexhibiting positive growth.
He remarked that the Services play an important role in everyday life, thatthey have a central place in both domestic and international economies, andthat they account for the bulk of the global Foreign Direct Investment(FDI) and trade. He added that they connect countries to the internationaltrading system by facilitating supply chains and e-commerce.
The advisor opined that the most significant increase in the exports of theservices had been in the Telecommunication & ICT services which hadincreased by 40 percent to $958 million during July and December 2020 ascompared to $684 million over the same period last year.
“The ICT Exports will soon become a very important sector in Pakistan’stotal exports, and I am optimistic that these would cross the $2 billionmark in the current financial year”, he declared.
The advisor also noted with satisfaction that the trade balance in theServices sector has improved significantly during the first six months ofthe current financial year.
The trade balance had stood at negative $977 million during July andDecember 2020 as compared to negative $1,697 million during the same periodin the previous year, thereby showing an improvement of 42 percent. He saidthat this would contribute significantly to the improvement of the CurrentAccount Deficit (CAD).
The advisor was briefed that workers’ remittances all over the world areincluded in the exports of services as they fall under Mode 4 of the WorldTrade Organization’s (WTO) classification of Services Exports which relatesto the presence of the natural persons of a Member in the territory of anyother Member.
He was also informed that the true impact of Pakistan’s Services Exportscould be conceived completely if the workers’ remittances are included inthe export of services as per the WTO practice.
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