ISLAMABAD: Pakistan’s trade deficit with South America continues to increase, as imports outbalanced the exports from the region during July-December 2017.
Pakistan’s imports from South America have exhibited a rise, touching $222 million during first half of FY 2017-18 against $305 million in FY 2014-15, reported Express Tribune.
Mercosur, an equivalent of SAARC in south-east Asia a trading bloc of South American nations is ranked fifth biggest economy globally with a GDP of $2.7 trillion.
The country’s trade volume with South American countries stood at roughly $600 million since FY 2014-15, except in FY 2015-16 when it touched $769.25 million.
During this period, Pakistan biggest trading partners were Brazil and Argentina. With Brazil, bilateral trade volume was recorded at $160.894 million during FY 2016-17. Bilateral trade volume with Argentina during FY 2016-17 touched $251.18 million according to SBP data.
Ministry of Commerce has said it has offered 2 percent additional drawback on exports to Latin American region and it also realized the significant trade potential available. It said steps have been carried to improve trade with Mercosur and South American countries on a whole.
Although Pakistan signed a framework accord on trade with Mercosur in July 2006, but since then no major advancement has been made.
The ministry blamed it to lack of agreement between Mercosur member states on entering into a Preferential Trade Agreement (PTA) with Pakistan and their priority in in reaching trade deals with European Union.
In a ministry compliance report presented before the Senate, it disclosed South American markets control market access of textile products to secure its domestic industry and consider Pakistani textile products as threats to their local industry.
A trade delegation is set to depart for Chile, Argentina and Peru from March 5th to 14th, 2018 for examining the market and reach business deals.
