SMEDA identifies items to boost exports to China

LAHORE: Small and Medium Enterprises Development Authority (SMEDA) has identified 45 high-potential exportable products that could lead to a substantial increase in the existing bilateral trade volume under China-Pakistan Economic Corridor (CPEC), a statement said on Thursday.

“The given trade potential has been identified by adopting a three-pronged approach, which includes; detailed analysis of Pakistan’s trade with China, focus group discussions and stakeholders’ input in terms of a short survey,” said Sher Ayub Khan, chief executive officer SMEDA, commenting on the study.

“The outcome of the study will help business community of Pakistan, especially SMEs (small and medium enterprises) to strengthen economic integration with the world’s largest trading nation, China.” Ayub said China imported a total of 5,578 types of products from around the world in 2015. Therefore, Pakistan can easily increase its exports to China through mutual understanding and consent.

According to the SMEDA statement, out of a total of 45 products identified in the study, 13 fall under the category of High Value Exports (HVE), 15 Medium Value Exports (MVE), and 17 have been categorised as Low Value Exports (LVE) items.

These 13 products include meat, fish, mangoes, chromium ores and concentrates, medical instruments, marble, footwear, rice, milk and cream, granulated sugar, denim, ethyl alcohol and footballs.

The SMEDA chief asserted that Pakistan’s global trade share, under the CPEC, would increase to an optimal level. “But, we will have to adopt an approach which can lead to a reduction in the prevalent trade deficit,” he said.

Ayub maintained that a good starting point in this regard had been set by the SMEDA through study of the export supply capacity and import demand ability of the country by identifying product lines and trends.

Giving further details the authority’s its statement said as many as 15 products categorised as MVE include maize, milk and cream solids, bananas, leather handbags, plastic/ textile material handbags, polyethylene terephthalate, sweet biscuits, modified polystyrene, safety razor blades, frozen orange juice, natural honey, frozen fish, frozen edible bovine offal, butter milk, butcher knives, and hunting knives.

“The list of 17 products categorized as the LVE include bran, articles of leather, paints and varnishes, articles of stone, folding cartons and boxes, coats and jackets, hydrochloric acid, tools for masons/ watchmakers/ miners, crates and similar articles of plastic, ballpoint pens, vegetable products, fruit seeds for sowing, articles of wood, clover seeds for sowing, shelled almonds, hide and skin of goats and crabs,” it added.

During the past few years, Pakistan’s imports from China have increased disproportionately compared to former’s exports to the latter. China is ranked as the second largest export destination of Pakistan with a share of 7.7 percent in Pakistan’s total exports, after the United States (16.7 percent).

Pakistan’s exports to China are heavily concentrated in cotton and rice, which accounts for 75 percent of Pakistan’s total exports to China. Notably, Pakistan’s cotton exports to China increased from US$358 million in 2006 to US$968 million in 2016.