The federal and provincial authorities need to design and implement a policy reform agenda in a coordinated manner, along with the broadest support from the public-private sector for export revival. This has been suggested by the World Bank economists in “Pakistan Development Update: Reviving Exports. ” Talking to WealthPK, Vice Chancellor of Pakistan Institute of Development Economics (PIDE) Dr. Nadeem ul-Haque identified numerous factors responsible for the country’s persistent trade imbalance. These include high import tariffs, limited availability of long-term financing, inadequate provision of market intelligence services, and structurally low productivity of firms.
“Fewer preferential trade agreements (PTAs) and commodity concentration have also been witnessed as major drivers of Pakistan’s export challenges. However, the modern world is using the PTAs and diversification as prominent tools to secure market access and to deepen regional and global integration,” Dr Nadeem added. As per the World Bank estimates, the share of exports in the GDP has been declining since the turn of the century, from 16 percent in 1999 to 9.1 percent in 2020.
This long-term decline has implications for the country’s foreign exchange, employment, and productivity growth. Concerning measures to make exports more competitive, the World Bank senior economists Ashraf Ghumman and Derek HC Chen said the initial priority should be to ease up import restrictions. According to them, upgrading the regulatory environment, diversifying products, and helping firms to comply with international standards are all essential for enhancing exports.
Moreover, WealthPK has explored that the Pakistani economy comprises almost 3.3 million small and medium enterprises (SMEs), generating approximately 25% of exports. Therefore, policies, including subsidized credit and training programs, must be encouraged to allow the SMEs to reach their full potential. Abdullah Shehryar, Executive Commercial Officer of China Road and Bridge Corporation (CRBC), said efforts must be made to revitalize exports. Focusing on collaboration and innovation would lead to the development of new and diversified products, better suited to the demand of international markets. In conclusion, prudent decisions and practical implementation are required to fix the export challenge.
Credit: Independent News Pakistan-WealthPk