Staff Report
ISLAMABAD - Pakistan and China on Thursday started negotiating the second phase of Freed Trade Agreement (FTA) with special focus on reducing Pakistan’s trade deficit in bilateral trade and tariff concessions to each other.
The first phase of the FTA between the two countries would conclude on 31 December, 2012 and the respective organizations of the two governments have started negotiations to finalize the modalities for the second phase which would be implemented from January 2013.
The current discussion would focus on devising a comprehensive plan to encourage exports from Pakistan to China and help reduce the huge trade gap between the two neighboring countries.
Although the trade between the two countries has witnessed growth following the signing of the FTA, however the balance is very much in favour of China, exports of which have increased by 36 percent on year-on-year basis.
The overall trade between the two countries in 2010 was at $8.67 billion,showing anincrease of 28 percent, said Deputy Director Chinese Ministry of Commerce, Zhu Hong while addressing the inaugural session here.
Out of the total trade, Chinese exports to Pakistan stood at US$6.9 billion, showing an increase of 36 percent while its imports from Pakistan were recorded at US$1.78 billion, showing upward trend of 37 percent,Zhu Hong added.
He said that tariff concessions would be negotiated for the second phase of the FTA to help Pakistan enhance its exports to China.
He said that both the countries would take steps to further enhance their bilateral trade and the friendship adding that China attaches a great importance to the bilateral trade.
According to Ministry of Commerce sources, both parties would endeavor to eliminate the tariffs of no less than 90% of products, both in terms of tariff lines and trade volume within a reasonable period of time on the basis of friendly consultation and accommodation of the concerns of both Parties.
Earlier, speaking on the occasion, Senior Joint Secretary Ministry of Commerce, Rehmatullah Khan said that Pakistan was passing through difficult times following the war on terror, recent floods that hit the economy badly and the global economic meltdown that had impacted country’s exports.
He highlighted the importance of evaluating the implementation of the 1st phase of the FTA to ensure that the second phase of the agreement improves the efficiency and helps provide more benefits to both the countries.
