Government failed to consult private sector on Pak-Turkey PTA, says EFP – Business & Finance

KARACHI: The Pakistani government is expected to sign a Preferential Trade Agreement (PTA) with Turkey on August 12, 2022. Through this agreement, Pakistan has agreed to grant duty exemptions to Turkey on nearly 220 products, while that Turkey granted an exemption on about 120 products in Pakistan.

However, the Ministry of Commerce failed to contact the private sector for consultations on the Preferential Trade Agreement (PTA).

In a statement, the President of the Employers’ Federation of Pakistan (EFP), Ismail Suttar, said that without consultations with the private sector, the Preferential Trade Agreement (PTA) could prove counterproductive for the Pakistani economy. .

This was seen before when the Pak-China trade deal was signed and Pakistan was never able to realize the true potential of the deal while China was able to export a considerably higher volume of products to Pakistan, thus worsening our balance of payments (BOP) position.

The Ministry of Commerce has not reached out to the private sector, nor to the apex bodies (EFP and FPCCI) representing the private sector in Pakistan.

Pakistan is going through an economic crisis due to which a Preferential Trade Agreement (PTA) without any private sector consultation might end up worsening the economic situation due to increased imports.

Ismail Suttar said, “It is imperative that Pakistan remain internationally competitive in sectors where the country has a competitive advantage. If the deal, which has no input from the private sector, does not include the right products, then it could very well harm Pakistan’s economy.

The VET chief said that several Pakistan-based companies may be negatively affected as a result of this agreement as their products may become uncompetitive with Turkish products which will benefit from duty exemptions. Currently, Pakistan needs favorable trade agreements to strengthen the country’s balance of payments position.

For this reason, it is very important that the Ministry of Commerce takes into account the views of the private sector on the agreement and on the products that should be included in it. Without any inclusion of the private sector, the government is putting Pakistan’s private industry and balance of payments position in serious jeopardy.

The Employers’ Federation of Pakistan (EFP) is calling on the Pakistani government to consult the private sector for any trade deal that Pakistan pursues because without any private sector deliberation, the deal is bound to create uncertainty for industries and Pakistan’s economic prospects. The country can no longer afford to have trade agreements that would be unfavorable to Pakistani industries and result in a sharp increase in the country’s import bill.

Copyright Business Recorder, 2022