ISLAMABAD: Trade experts have said Pakistan’s economy is the least integrated in the global value chain and, hence, will not suffer significantly from the recent US-China trade war in the short term.
The trade experts expressed these views while addressing a special seminar on “Where Does Pakistan Stand in Global Trade War?’ organised by Sustainable Development Policy Institute (SDPI), here on Monday.
They said that Pakistan should not worry about this rather it should revisit its trade and industrial policy and direct its production incentives and preferences under free trade agreements towards products that are in demand in countries with lower trade barriers, higher consumer confidence, a stable growth outlook, and the potential for supply-chain integration.
Speaking on the occasion, National Tariff Commission Member, Roubina Ather said that the greatest threat of this trade war is protectionism which in turn will shrink the global trade volume. “We should not be over-concerned on the on-going global trade war mainly between China and the US, as unfortunately or fortunately, Pakistan is not so much integrated in the global value chain”, she said.
Speaking earlier, SDPI Joint Executive Director Dr Vaqar Ahmed said that the ongoing trade war between China and the US may cause a rise in the cost of production and raw material in developing countries which in turn could bring about inflation and threaten the global economic recovery.
Dr Vaqar said that the US-China trade hostilities will also open the doors for other advanced economies to step up protectionism and start making foreign imports more expensive through tariffs, Para-tariffs and non-tariff barriers. He said this will hurt the decade long efforts of trying to revive a more liberal trade regime and save multilateralism.
“As Pakistan is an importer of iron, steel and aluminum from China and US, it will be good news if both super powers end up having an abundant supply glut in turn brining global prices of metals down,” said Dr Vaqar, adding that this could see costs of large scale manufacturing units go down.
Competition Commission of Pakistan Director General, Ahmad Qadir on the occasion said that the nature of doing business is changing, where economies are becoming part of global value chain. “Becoming a part of integrated global value chain, where technology transfer and innovation takes place, the developing countries like Pakistan should take care of the changing scenarios” he said.
[…] During this trade war period, China has been attempting to ask America’s European allies for help, however, haplessly, not only Europe countries replied with a neutral posture, it’s mere ally Pakistan, unexpectedly gave a backbite. […]