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TRADE

April 08 - 14, 2002

IRAQ TO BUY SUGAR, FERTILIZER PLANTS

Iraq has agreed to purchase sugar and fertilizer plants from Pakistan and set up its own flour mills in Karachi for import of finished products instead of wheat.

This was the outcome of talks between Commerce Minister Abdul Razak Dawood and 7-member delegation of Iraq led by Deputy Minister for Agriculture Dr Basil Dalali on Wednesday, official sources told.

"Pakistan has welcomed Iraq's decision to set up its flour mills near proposed grain silos in Karachi", said a commerce ministry official. A joint delegation of Heavy Mechanical Complex (HMC) and Pakistan Machine Tool Factory (PMTF) would be dispatched to Baghdad on the request of the visiting delegation to discuss technical details for export of sugar and fertilizer plants there, the official said.

The delegation also expressed keen interest in importing medicines, rice, wheat, chemical engineering machinery, information technology products and electronics. During the current fiscal year, Iraq had agreed to import 100,000 tons of wheat from Pakistan but rejected consignments of 65,000 tons due to dispute over quality.

So practically, Pakistan could export only 35,000 tons while the Trading Corporation of Pakistan (TCP) had to dispose it off on very reduced rates. The deficit consignments of 65,000 tons are now being exported by TCP through a private exporter Karim International.

In all Pakistan could export wheat worth $4 million. A consignment of 14,500 tons has been sent to Baghdad during last week of March while two consignments of 30,000 tons and 11,000 tons would be dispatched on April 5 and 12 respectively, the meeting was informed.

Last year, Pakistan exported $8.2 million worth of rice to Iraq against $4.5 million during seven months of the current fiscal year. The question of rice did not come up for discussion during the meeting.

TEXTILE QUOTA EXPORTS TO US DOWN BY 25PC

Pakistan Readymade Garments Manufacturers & Exporters Association (PRGMEA) chairman Masood Naqi on Thursday said that garment exports to the US had come to a complete halt that forced the exporters to divert their products to the EU market.

In a statement, PRGMEA chief said this created a cut-throat competition among the exporters, resulting in drastic fall in per unit price of garment to the EU market.

Masood Naqi said that other textile quota exports to the US has also dropped by over 25 per cent while exports of fabric increased in some categories between 25 to 88 per cent.

The difference in value addition can be seen from the fact that the average unit price of garment is $17.42 per kg against average unit price of $4.93 per kg in case of fabrics. This indicates an alarming trend which will be reflected in considerable decline in foreign exchange earnings, he added.

PROTOCOL AGREEMENT WITH SYRIA SIGNED

Pakistan and Syria on Thursday agreed to further enhance and strengthen the existing trade cooperation between the two countries with the latter showing interest in Pakistani products like fertilizers, wheat, rice and sugar.

"Syria needs fertilizers, wheat, rice and sugar from Pakistan and we are looking what we can supply from these products," Commerce Minister Abdul Razak Dawood told after the signing of a protocol agreement between the two countries at the conclusion of the fourth session of Pakistan-Syria Joint Ministerial Commission (JMC).

IMPORT OF RECONDITIONED CARS MAY BE ALLOWED

The government intends to allow import of "company-reconditioned cars" with certain duty reductions in the budget 2002-03 if the local industry failed to double its production by May 10, 2002 deadline.

Commerce Minister Razzak Dawood has summoned all the car manufacturers on Tuesday to forewarn them about the government move following president Gen Pervez Musharraf's displeasure over high prices and artificial market shortage, official sources told on Monday.

IMPORT OF SHIPS EXEMPTED FROM DUTY

The federal government has exempted the import of ships and all the floating crafts from the customs duty till the year 2020. The duty exemption to be allowed on import of ships and floating crafts included tugs, dredgers, survey vessels and other specialized crafts purchased or bare-boat chartered by a Pakistani entity and flying Pakistani flag.

CONTAMINATED SHRIMPS

The European Union has imposed 100 per cent checks on import of frozen fish products from Pakistan following detection of a contaminated consignment of shrimps at Rotterdam recently, sources in the Ministry of Food told.

The incident rang alarm bells in the government quarters particularly the ministries of commerce and food as China, Vietnam and Indonesia lost significantly the EU market on same grounds, i.e., high level of chloramphenicol in the fish products.

EPB SEEKS $50M FOR GUARANTEES

The Export Promotion Bureau (EPB) is seeking $50 million fund from the government for arranging guarantees and collaterals for the construction companies aspiring to participate in Afghanistan's reconstruction work jobs.

This was stated by Minister for State and Chairman EPB Tariq Ikram at a dinner given by FPCCI vice-president Haroon Rashid on Saturday.

EXPORT FINANCE UP

Exporters will get export finance from banks at 8 per cent during this month instead of 7.5 per cent.

The export finance rate has moved up to 8 per cent as the State Bank has told banks that it would provide them export refinance at 6.5 per cent in April 2002 up from 6 per cent in March. As usual banks are free to charge 1.5 margin while offering export finance to the exporters. In March the export refinance rate was fixed at 6 per cent and banks were allowed to add another 1.5 per cent to it while providing export finance to eligible exporters.