Commerce Minister Makhdoom Amin Fahim has urged the US to expedite progress on bilateral investment treaty (BIT) and reconstruction opportunity zones (ROZs). Talking to US Ambassador to Pakistan Anne W Patterson, who called on him in his office on Monday, the Commerce Minister argued that Pakistan should be rewarded in terms of trade as its economy had been hit due to its engagement in the global war on terror.
He expressed the hope that the US government would accelerate work on ROZs. Considering the importance of providing market access to Pakistan, he said, an initiative on creating ROZs had been under the process of legislation in the US Congress since 2006.
The bill envisages establishing zones in certain regions of Pakistan, where a large number of goods, exported to the US, would receive duty-free treatment. They also discussed an enhanced market access for Pakistan to the US markets through GSP+ (Generalised System of Preferences). Bilateral trade between the two countries also came under discussion.
To promote bilateral trade, a joint study group (JSG) was recently constituted between the two countries. The US is a major destination for Pakistan's exports, as 20 percent of our exports are earmarked for the US markets. The bulk of Pakistan's exports are textile made-ups, leather garments, sports goods and rice.
The Commerce Ministry argues that free trade agreement is a complex legal instrument that not only requires political commitment on both sides, but also the ability, particularly in the context of developing countries, to foster a sustainable process of reform. According to the ministry, as an indication of Pakistan's ability to negotiate and conclude such complex agreements, the government needs to demonstrate progress on the BIT.
The first meeting of the JSG is expected to be held in February next in Islamabad during which both the countries will discuss a broad-based agenda, including review progress of the US legislation on ROZs, update on Pakistan's use of GSP benefits (USTR), reducing barriers to trade, improving investment climate and facilitating irradiation/export of Pakistani mangoes. Besides new Commerce Secretary Zafar Mahmood, senior official of the ministry were also present in the meeting.