Though trade agreements like Preferential Trade Agreement (PTA) or Free Trade Agreement (FTA) are yet to be signed Pakistan and Turkey despite the claims from both sides for the last eight or so years, visiting Turkish steel exporters have stressed the need for just such agreement in order to boost bilateral trade.
Expressions of interest
14 leading steel companies of Turkey, which held detailed meetings with at least 40 companies’ heads here on at local hotel on Friday, expressed interest in investing in Pakistan’s steel sector.
Interestingly, around 200 companies in the international market currently cite lack of agreements as a major hurdle in the way of initiating trade with Pakistan in steel products.
Talking with media persons, Namýk Ekinci, Chairman of the Board of Directors, Turkey’s Steel Exporters’ Association (CIB), said his country is the 10th largest producer of steel, which produced 34 million tones of the product last year. This year’s production is estimated at 39 million tones. At least 26 million tones were consumed in his country while 18 to 19 million tones were exported.
Turkey could also export flat sheets to Pakistan where the products have huge demand. Besides, due to its high quality, Turkish steel has worldwide demand, he added.
He hoped as soon as the agreements are signed between the two countries the trade of steel products would be started at competitive rates.
To modern ways
“During our visit we had the pleasure and honour of meeting with top executives of Pakistan Steel. In our meetings we informed them that as Turkish Steel producers, we will be glad to share our experiences with our brothers and friends in Pakistan. After receiving an official letter from the esteemed ministry, we will start necessary talks and make preparations to send Pakistan a team of Turkish technicians and engineers in order to analyse the current situation of the mill. Subsequently a report can be prepared to define the necessary steps to develop and modernise the factory according to current technologies”, he said. then we would share this report with valuable members of our association and we are sure that this cooperation will end up with the mutual benefit of both parties, he added
However, a Pakistani steel merchant claimed that until and unless there was PTA/FTA between the two countries or subsidised production in the foreign country, trade at competitive cost was not possible. There were much cheaper products available in other countries like China. However, he said Turkish products are highly qualitative.
Been here before
It bears noting that a proposed PTA, aimed to lead the two Islamic countries to a FTA to strengthen bilateral trade, was not signed since it was suggested in 2004 due to the lack of interest, mainly on the part of Turkey.
According to sources, Pakistan was willing to negotiate and finalise the PTA as both nations already agreed in the Framework Agreement on PTA of 2004. Pakistan was looking for an FTA, provided it was permitted by Turkey’s commitments under its customs union with European Union (EU). However, Turkey has been working on a go-slow policy as 80 per cent of the tariff lines of Turkey were bound with the European Union (EU) customs union. In addition, Turkey could not agree to allow substantial concessions for the remaining 20 per cent tariff lines as it was a politically sensitive issue.
Current bilateral trade stands at a meager $740 million. Pakistan’s export to the foreign country has also increased by 50.35 per cent during the first six months of the financial year 2010-2011, as Islamabad exported goods worth $320.56 million during July to December 2010 compared to $213.2 million in the corresponding period of 2009.
Pakistani exports to Turkey include rice, sesame seeds, leather, textiles, fabrics, sports goods and medical equipment. While, Pakistan’s imports from Turkey primarily include machinery and parts, chemical elements and compounds, chemical materials, non-ferrous metals and coloring material, etc.
