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    Rise in exports despite sanctions

    Rise in exports despite sanctions

    By Jawaid Bokhari


    KARACHI, Nov 4: Sanctions and lower capital inflows over the years have hit imports from
    developed countries and turned Pakistan's traditional trade deficit with donor states into substantial
    surpluses, specially with the USA emerging by far the largest export market.

    Despite the shrinking share of industrialized world in country's foreign trade, exports to the USA have
    soared to nearly 22 per cent of total sale of merchandize, exceeding imports by well over $1 billion on
    an annual basis.

    In 1998-99, export earnings from USA touched $1,818 million against imports of $766 million, down
    from $1135 million a year earlier, resulting in favorable trade balance of $1,052 million.
    Simultaneously, the share of G-8 members in overall imports has declined from 34.2 per cent in
    1997-98 to 30.5 per cent in 1998-99, a fall from $3.4 billion to under $3 billion. Pakistan's export to
    this club of industrial giants has remained stagnant at around $3.9 billion.

    Western diplomats say that sanctions imposed by the G-8 on fresh lines of credit following nuclear
    blasts in May 1998 does not deny access to their markets for Pakistani goods and services. Exports
    have not picked up fast because of quality, price or restricted production.

    Economists say that it is foreign finance capital that has helped boost imports in the past from
    donor-states and funded creation of manufacturing facilities and other development projects. Global
    preference to foreign private investment over official loans and credits is slowing down capital inflows
    that spurred growth in imports. Currently, there is no significant improvement in the flow of foreign
    private investment.

    Official documents show that commitments of foreign assistance have declined by 35.6 per cent from
    $2.6 billion in 1990-91 to $1.7 billion in 1999-2000. It has impacted on imports adversely during the
    corresponding period. USA's share in Pakistan's total imports have dropped from 11.8 per cent to
    7.7 per cent. On the other hand, for a variety of reasons including a strong dollar and a fast
    depreciating rupee, US share in total exports has more than doubled in the decade, from 10.8 per cent
    to 21.8 per cent.

    According to a FPCCI study, Pakistan's imports from EU states have fallen by nearly $1 billion over a
    three-year period ending June 1999. Imports have not picked despite a falling Euro. Exports have
    fallen by $266 million during the corresponding period but Pakistan netted a trade surplus of $697
    million with EU countries in 1998-99.

    A former FPCCI president Latif E. Jamal says that there is some silver lining and foreign trade would
    pick specially with the approval of IMF stand by credit this month. It would serve as a positive signal
    for both domestic and foreign investors.

    In 1996-97, Pakistan imported goods worth $2745m from EU states against $1801m in 1998-99.
    Exports dropped from $2765m to $2499m in the same period. With imports of textile machinery from
    Europe worth about $500m currently under way, trade imbalance may be reduced.

    ------------------
    CROIRE A L'INCROYABLE
    You can't fix stupid. So might as well troll them!

    #2
    Magnificent news CM! Good job buddy!

    I always knew that our economy had turned the corner and things were looking up, but the doomsayers and so-called "economists" were trying to belittle the CE's economic achievments. I wonder what they'll say now?

    Comment


      #3
      Now they will say it was all NS work or that the weather was the main factor thus we have such a huge bumper crop.

      But it is going very well.
      InshAllah we will increase our exports this year as well.
      This is looking very good for the CE and very bad for his critics.
      Also have you heard about the China-Pak Biotech venture.
      Can't find any info on it on the net, but looks very good if it can be tied in with our IT sector.

      ------------------
      CROIRE A L'INCROYABLE
      You can't fix stupid. So might as well troll them!

      Comment

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