BUSINESS WITH PAKISTAN :
Pakistan is a developing market with a young and growing population of around 186 million. About 55 million live in urban areas. It’s estimated that Pakistan’s cities generate up to 78% of national Gross Domestic Product (GDP), with Karachi alone contributing about 20%. The growing / aspiration middle class has an appetite for creative, innovative and high quality goods and services. Many Thai businesses are currently doing business in Pakistan, including well-known companies such as CPF, SCG, and Sea Value etc.
Pakistan is ranked 128th by the World Bank in its Ease of Doing Business Index, higher than India and Bangladesh.
Benefits for Thai businesses exporting to Pakistan include:
- English is wide use as a business language in Pakistan.
- Location in the middle of Asia making Pakistan a gateway to northern India, Afghanistan, Tajikistan, Kyrgyzstan, Uzbekistan, Kazakhstan and western China
- Similar legal practices
- Familiarity with Thai companies and brands
- Growing middle class
Strengths of the Pakistan market include:
- 6th most populous country with over 50% population under the age of 25
- Strong business and consumer base
- 9th largest English speaking nation
- Investor friendly
- Home to over 600 foreign companies
- Links with Pakistani communities in Thailand
- Educated workforce
- Low production and labor costs
Despite its potential, Pakistan’s economy has not yet experienced the rapid expansion seen in Asia’s emerging markets. To revive growth, the government has implemented reforms supported by an International Monetary Fund (IMF) programme agreed in 2013.
Pakistan benefits from:
- one of the world’s youngest populations
- stable and growing domestic demand
- proximity to fast growing Asia
- wealth in natural resources - particularly coal
The IMF has revised upwards its growth estimate for this year to 4.3%, and expects it to rise to 5% in 3 years.
More than 50% of Pakistan’s economy is services based, with trade-related and communication services among the largest. Industry accounts for nearly a quarter of GDP, and includes an export-oriented textile sector, as well as chemicals and food processing. Manufacturing activity has recently received a boost from the government’s moves to improve energy availability.
Pakistan trade agreements
Pakistan – Thailand FTA is on the way and expecting to complete within year 2018, currently Pakistan has 7 bilateral trade agreements in place: Afghanistan, China, Iran Indonesia, Sri Lanka, Malaysia and Mauritius. These preferential and free trade agreements mean that parties enter into binding commitments to relax access to each others’ markets’ for goods, services, and investment.
Pakistan is also a member of the South Asian Free Trade Area (SAFTA), an agreement that aims to establish free trading between its members (a region home to around 1.6 billion people) by 2016.
Pakistan and India are currently discussing a Non-Discriminatory Market Access Agreement. When agreed, this will open up trade between Pakistan and the vast Indian market.
Moreover, under the Afghan-Pakistan Transit Trade Agreement (APTTA) signed in 2010, Pakistan serves as a gateway to landlocked Afghanistan. This means that goods destined for the Afghan market use Pakistan’s seaports to transit through the country. In turn, it allows exporters from Pakistan access to central Asian markets via Afghanistan.