Ibf Presentation

Analytical overview of trade deficit 

The recently released First Quarterly Report of the State Bank of Pakistan (SBP) JulySeptember 2008 “focused on macroeconomic discipline and good governance”

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macro-economic stabilization programme support medium term reforms The risk of any immediate default receded on account of the receipt of $3.0 billion by end November 2008. pressure on the strength of Pakistan Rupee.

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(GDP) in FY09 will be in the range of 3.5 – 4.5 per cent against the target of 5.5 per cent . Inflation in the economy will be at a disturbingly high rate of 20-22 per cent as against the annual plan target of 11.0

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Total liquid foreign exchange reserves at end-November 2008 amounted to $9.1 billion against $15.7 billion at end-November 2007. foreign investment during July-November 2008 stood $1.4 billion as compared with $1.8 billion and $2.0 billion in the same periods of FY08 and FY07 respectively .

Reasons of Trade Deficit        

Narrow export base Import oriented industries Consumption oriented society Less modernization of machinery Less production of value added goods Political uncertainty Depreciation Rise in freight rates

Reasons of Trade Deficit     

Increase in prices of inputs Technical barriers Slow growth of Production Tariffs Heavy import of food grain

How to Enhance Exports • • • • • • •

Consistency in Economic Policies Product and market diversification Competitiveness Brand development Packaging Export and Import Bank Agricultural and Mineral Based Products

How to Enhance Exports • • • • • •

Joint Ventures Human Resources Development Standards (Quality/Environment/Social) Export Processing Zone’s Role Image Building Role of Trade Commissioners

Solutions of Trade Deficit 

Balance of payments

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Challenges

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Capital goods

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Edible Oils

Solutions of Trade Deficit 

Fertilizers

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Trade Account

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Invisible Account

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Current account