Thursday February 22, 2024

FPCCI backs Look Africa initiative, pushes for bilateral trade deals

By Our Correspondent
January 24, 2024

KARACHI: Pakistan's top business body urged the government on Tuesday to sign free trade agreements (FTAs) with African nations, saying it would help increase the country's exports to the continent and reduce its trade deficit.

This picture released on September 21, 2022, shows the logo of the Federation of Pakistan Chambers of Commerce & Industry (FPCCI). — Facebook/Federation of Pakistan Chambers of Commerce & Industry
This picture released on September 21, 2022, shows the logo of the Federation of Pakistan Chambers of Commerce & Industry (FPCCI). — Facebook/Federation of Pakistan Chambers of Commerce & Industry

The Federation of Pakistan Chambers of Commerce and Industry (FPCCI) said it fully supported the Look Africa Policy Initiative of the Ministry of Commerce, which aims to enhance trade and economic cooperation with African countries.

FPCCI acting President Saquib Fayyaz Magoon said Pakistan should pursue bilateral FTAs with the top seven economies of Africa - Egypt, Nigeria, South Africa, Algeria, Ethiopia, Morocco and Kenya - which account for about 78 percent of the total gross domestic product (GDP) of Africa.

"There are significant economies in Africa with whom we can multiply our trade volumes within years - both bilaterally and exports to the region cumulatively," Magoon said in a statement.

He said Pakistan's exports to Africa, as a whole, showed stagnation at around $1.5 billion in 2022, while its imports from Africa rose from $3.18 billion in 2018 to $4.38 billion in 2022, resulting in a trade deficit of $2.88 billion.

Magoon said Pakistan should aggressively increase its export volumes in sectors such as pharmaceuticals, steel, cement, seeds and tractors, which have a huge demand in Africa.

FPCCI and the Pan African Chamber of Commerce and Industry (PACCI) held a high-profile interactive session on Tuesday to identify and explore areas of mutual interest, such as trade promotion activities, chamber-to-chamber linkages, investments, joint ventures, business tourism and economic cooperation.

PACCI Executive Director Kebour Ghenna said the African Continental Free Trade Area (AfCFTA), which came into effect in 2021, had enabled enhanced trade between African countries and boosted economic growth.

He said PACCI and its member countries were open to trade agreements with countries around the world and appreciated Pakistan's Look Africa initiative as a way to incentivize trade relations.

Ghenna said PACCI was looking forward to signing a memorandum of understanding (MoU) with FPCCI to encourage business communities on both sides to hold trade fairs, exchange trade delegations and advocate the formalization of trade agreements with their respective countries.

Pakistan's ambassador to Zimbabwe, Murad Baseer, said government-to-government contacts were underway to sign MoUs and FTAs with African counterparts and some progress was being made. Zaki Aijaz, vice president FPCCI said Pakistan and many African nations share common challenges, such as poverty, healthcare, education and geopolitical conflicts. "Nonetheless, they have performed better when it comes to exports to Pakistan," he said

Aijaz said said there is a huge demand of pharmaceuticals, steel, cement, seeds and tractors in Africa; and, Pakistan should aggressively upscale their export volumes in those sectors as these are low hanging fruits.

FPCCI Patron Almas Hyder expressed his concerns that neighbouring India had signed about 32 trade agreements with African countries and Pakistan had made no progress in terms of export promotion.

"We need FTAs to accelerate exports to Africa and to have trade facilitation and dispute resolution mechanisms under them," he said.