trade
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‘Trade policy to formed with mutual dialogue’

LAHORE: Ministry of Commerce Forthcoming Strategic Trade Policy Framework (STPF) 2018-2023 will be formulated while incorporating the insight obtained from constructive and broad-based engagement between public and private sectors with a view to address Pakistan’s gradual decline in export competitiveness over the past 20 years.

Noman Aslam, Director General of Trade Policy at the ministry, expressed these views at a roundtable conference ‘Achieving Export Competitiveness in Pakistan’ organised by Sustainable Development Policy Institute (SDPI) here Tuesday.

Charting the development of Pakistan’s trade policy over the last decade, he highlighted Pakistan’s movement towards a more forward-looking and longer-term approach since 2009, when the MoC drafted its first three-year STPF. In this regard, he mentioned the Ministry’s forthcoming trade policy framework would be valid for five years (2018-23).

About decline in Pakistan’s exports over the last two decades, Gonzalo J Varela, Senior Economist at the World Bank Group (WBG), presented the detail of country’s challenges in penetrating more diverse export markets and leveraging global value chains as a vehicle of sustained economic growth. He explained how Pakistan’s overall share of the global export market had declined in comparison to peer economies such as India and Bangladesh, even though the country’s exports had increased in absolute terms. To reverse this decline, he recommended more market and product diversification and measures to improve quality and sophistication of Pakistan’s export basket.

While, WBG’s Senior Economist Nadia Rocha recommended introducing modern trade facilitation measures and a flexible exchange rate mechanism in the country. She alsorecommended steps to reduce cost of doing business, besides creating a more favorable climate for foreign direct investment. In this regard, she stressed the need for greater trade liberalization efforts, which could boost productivity and export competitiveness in Pakistan.

Earlier, SDPI Deputy Executive Director Dr Vaqar Ahmed highlighted key issues identified by business community in the context of nation-wide consultations held by the organisation. He explained how, despite recent investments in the energy sector, the cost of energy was still higher than in regional economies, reducing the competitiveness of local industries.

He mentioned that how local business competitiveness was being eroded by imposition of multiple taxes by numerous revenue authorities at federal and provincial levels. He explained how these same businesses faced audits by multiple tax bodies, leading to double taxation and higher compliance costs.

To address the decline in Pakistan’s export competitiveness, he suggested reducing the overall regulatory burden on businesses, especially in terms of registration and compliance with tax, environment, labor and building regulations. In this regard, he also called for greater public-private cooperation to encourage the adoption of productivity-enhancing technologies and improve sophistication and quality of Pakistan’s export basket.

APP