Enhancing Trade Competitiveness of Pakistan through Trade Facilitation Measures

Abstract

ABSTRACT Enhancing Trade Competitiveness of Pakistan through Trade Facilitation Measures Muhammad Hassan Farid Impasse in the Doha Development Agenda has been generating new alternatives which can drive a wedge between export and import prices. The role of trade facilitation policies in bridging that wedge has been recognized among economic and trade pundits. Trade facilitation is multi-faceted area which can shape the competitiveness of trade by interacting with multi-dimensional spheres of increasing complexity of trade by reducing trade transaction cost. Pakistans share of global exports has been decreasing since 1999. Export growth is stagnant. Many factors and policies may be responsible for this. It may be the result of both the external and internal environment, political and economic reasons, and regional and national policies. Since the 1970s, Pakistan has not prioritized trade development agenda. Thus, Pakistan has not particularly pursued trade facilitation measures aggressively. In the meantime, many regional countries as well as East Asian countries have vigorously adopted trade facilitation measures alongside trade policies. Results have yielded in the form of elevated share of their products in world markets. In this context, trade facilitation measures, particularly customs efficiency, port and logistic efficiency, regulatory environment and e-business usages appear attractive and suitable to Pakistan. Trade facilitation measures (four) have received less attention than it ii deserves when it can increase its export growth by adopting trade facilitation agenda in addition to other policy measures. Inefficiency in governance, corruption in public institutions, deteriorating law and order situation due to lack of legal strength and effective judicial apparatus, inefficient property registration process, weak protection of private businesses, increasing transaction trade cost associated with archaic colonial customs infrastructure, burdensome procedures of manual-based customs clearance, congested seaports and very low e-connectivity are hallmarks of Pakistans trade facilitation infrastructure. To increase the port efficiency, there should be open competition for terminal handling companies. Semi structures (gantry cranes and reach stackers) should be sufficient in numbers to avoid congestion inside the port. Optimum usage of information technology (IT) should be ensured for speedy port operations. Automation of custom procedures of entire Pakistan is needed. Development of its own customs software is required to ensure transparency. Pakistan needs to improve its legal system. Comprehensive reforms must be introduced for semblance of independent judiciary, effective governance and corruption free society. Pakistans e-connectivity is abysmal and needs to focus on the service sector. Automation in all government departments is urgently needed. Private sectors and foreign direct investment should be encouraged to enter the cellular phone market and the Internet Services Providers market. Key Words: Trade Facilitation Measures, Competitiveness of Trade, Doha Development Agenda