By Staff Reporter
ISLAMABAD: Pakistan and the Gulf Cooperation Council agreed to a preliminary free trade deal, the first by the six-nation bloc with any country since 2009, as Islamabad seeks to boost its exports and attract more foreign investment.
The Secretary General of the GCC, Jassem Mohamed Albudaiwi, and Pakistan’s Commerce Minister Gohar Ejaz signed the deal on Thursday at the headquarters of the General Secretariat in Riyadh, according to statements from both sides.
The GCC is a six-country bloc comprising Saudi Arabia, the United Arab Emirates, Bahrain, Oman, Qatar, and Kuwait.
“This is a significant development as the FTA is the first by GCC with any country since 2009 and marks a milestone in both sides’ economic cooperation,” the Pakistan commerce ministry said in a statement.
The GCC also released a statement, saying the “historic” agreement represented “an important turning point in cooperation and would contribute to growth and prosperity in a way that serves the common interests of both sides.”
“GCC countries are moving forward with the file of free trade negotiations with other countries, aiming to open and enhance the prospects for trade and economic cooperation for the Council member states regionally and internationally.”
The preliminary deal will now be followed by an internal administrative and approval process before the final agreement is signed and comes into effect.
Pakistan’s exports to the GCC stood at $2.8 billion in 2020-21, while its imports from the bloc were $8.4 billion, according to official data.
Pakistani officials said the FTA would help boost trade with Gulf nations by removing tariff and non-tariff barriers and providing preferential access to Pakistani products.
The signing of the FTA comes as Pakistan is pushing to pitch an improved business climate and its potential for foreign direct investment in a range of sectors. In June, Pakistan set up a Special Investment Facilitation Council (SIFC) — a civil-military hybrid forum — to fast-track decision making and promote investment from foreign nations, particularly Gulf countries.
The council has identified five sectors as priority, namely agriculture, mining, information technology, defense production and energy, as Pakistan deals with a balance of payments crisis and requires billions of dollars in foreign exchange to finance its trade deficit and repay its debt obligations.
Currently, Pakistan has free trade agreements with China, Malaysia, and Sri Lanka, though it also wants to export more to other trade destinations.
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