World Bank economist shares with students his thoughts on trade in Pakistan
May 6, 2021: Senior Economist in the Macroeconomics, Trade and Investment Global Practice of the World Bank, Mr. Gonzalo Varela, gave an online guest lecture to the students on 'Trade in Pakistan some patterns and some thoughts'.
Mr. Varela started off his discussion by displaying a poll about whether the electric vehicle policy should focus on environmental sustainability or productive capacity. He spoke about how Pakistan's trade is unintentionally restricted and has remained the same since the last 20 years.
He proceeded to show a graph which pointed out how Pakistan's export orientation has decreased by 10% in 2019. He added that Pakistan has lost global export market share in the last 2 decades. However, it has gained foreign demand in some specific areas such as fish and seafood, fruits, knitted and non-knitted apparel.
Mr. Varela shared that Pakistan is low in diversification and reaches around 9.5% of the destinations, whereas, China and Germany are in the lead with a whopping 95%. There is relatively higher diversification in the textile and clothing industry as this reaches 182 markets.
He emphasized that trading is a risky business as there is a lot of competition and the clients being dealt with may dislike the quality of your exports, adding that productivity is essential for exporting and has been stagnating. He shared a chart which showed how in 2018 Pakistan only increased its output by 38.1 % in the last three decades while Vietnam increased its output by 257.6%.