Trade Pact With China, Trade Pact With China, Trade Pact With China

Trade Pact With China

Trade Pact With China: To address the Chinese concerns over Free Trade Agreement (FTA), officials from ministry of commerce met with Chinese trade bodies this week. The main purpose of this meeting was to talk about Chinese concerns as Pakistan is seeking way forward on the 2^nd phase of trade pact.

In several session of consultation with representatives of small, medium and large industries, Pakistan aim was to finalize their offer lists. Ministry officials stated that additional recommendations for their respective sectors were accommodated while China agreed on the offer framed by Pakistan ministry.

China trade bodies appreciated Pakistan effort in addressing their concerns and making the process transparent on Phase II of China Pakistan free Trade agreement.

Pakistan has offered zero duty on almost 6,000 tariff lines out of the total 7,000 to China under the 2^nd phase of the Free Trade Agreement.

Pakistan Imports

Pakistan’s imports from China are greater than 50% of global imports in 44 percent tariff lines.
Pakistan’s imports from China increased from 18% to 28% of its global imports. Pakistan’s imports from China are 36% of Pakistan’s non-oil imports while China’s imports from Pakistan are 0.1% of the country’s global imports.
China’s exports to Pakistan increased from 4 billion dollars in 2006-07 to 14.56 billion dollars in 2016-17 while Pakistan’s exports increased from 0.5 billion dollars to 1.47 billion US dollars during the same period.

Pakistan’s Global Trade Deficit

Due to an increase in investment led imports, Pakistan’s global trade deficit has increased to 30.9 billion dollars in 2016-17.

CPEC Balance Of Payment

The CPEC and infrastructure investment related balance of payment (BOP) outflows for Pakistan are expected to rise about 3.5 to 4.5 billion US dollars by Fiscal year 2024/25.

While at the same time several trade bodies have opposed the revised Free Trade Agreement (FTA) with China. They stated that Pakistan does not possess exportable surplus so exports from Islamabad could not get a boost even if it gets huge incentives from China resulting in freezing the industries of Pakistan.