Pakistan has had a period of stability and continuity for almost seven years since the present government assumed office in October 1999, at the outset of which a clear vision for Pakistan’s future had been outlined. The economic reform agenda figured most prominently in this vision, since this was a necessary prerequisite for improving the lot of Pakistan’s most needy, especially through accelerated economic development. In this regard, the government has taken many bold and visionary decisions, and by doing so, has ensured a bright future for all Pakistanis.
In 2005, the Ministry of Commerce focused on trying to maximize the level of the country’s exports, resulting in exports for the fiscal year 2005-06 amounting to a total of $16.468 billion. This represents an increase of US$ 2.1 billion or 14.44% over last year’s level of US$ 14.391 billion. This increase is slightly more than the growth achieved last year, i.e. of US$ 2 billion. It is also noteworthy that despite the challenges faced during the year, the export growth rate of 14.44% this year is substantially more than the world merchandise export growth rate of 13% in 2005.
The statistics relating to trade in services, while being reflected in the country’s balance of payments figures, are not fully disaggregated. As a result, while it is possible to discern the exports and imports in some service sectors, it is not possible to do the same in others because they are reflected in too broad a category. This situation makes it difficult for the Government to plan rigorously for the benefit of this sector. It has therefore been decided that the State Bank of Pakistan will immediately start the process of fully disaggregating the services trade figures from the balance of payments statistics, so that by the end of the fiscal year 2006-2007, there is more clarity. Nevertheless, given the current level of disaggregation, it is clearly evident that in a ten-month period i.e. July 2005 to April 2006, the export of services in only three service sectors i.e. construction services, computer-related services and other business services, Pakistan’s exports reached around US$ 392 million. This is a reasonable achievement in view of the fact that over the last year the country was working in a very difficult environment.
The continued stability in Pakistan’s fiscal position has helped to increase exports considerably over the last six years, with exports having risen by almost 100%. New policies under trade diplomacy have been initiated, which has helped to improve Pakistan’s market access internationally. When economies grow rapidly like Pakistan’s has grown, certain challenges are faced, and Pakistan’s has been inflation. Future challenges lie in striking the right balance between economic policies to achieve exports growth, control inflation and narrow the trade gap. In addition to that, the country needs to especially focus on human resource development, infrastructure, reducing the cost of doing business, and giving the country’s exporters a level playing field relative to their competitors.
Increase the country’s exports requires a comprehensive effort involving many Government divisions. The sector-oriented vision required for industrial, agriculture and services areas will be a significant exercise for the country in order to be able to make use of future opportunities which will be available to it.
