In a recent address to a group of journalists, Dr. NadeemulHaque, Vice Chancellor, and Dr. DurreNayab, Pro Vice Chancellor, shed light on the pressing issue of Pakistan’s widening trade deficit, emphasizing the critical role of export competitiveness in the country’s economic landscape. Dr. NadeemulHaque began by acknowledging the paramount nature of the challenge at hand, stating, “Lowering exports has emerged as a significant contributor to Pakistan’s persistent trade deficit, posing a multifaceted challenge that has plagued the country since the early 2000s. During the last two decades, the contribution of exports to our GDP has declined from 16% to 10%.”
Drawing attention to the international context, Dr. DurreNayab highlighted, “Pakistan’s share in global trade has dwindled from 0.15% in 2005 to a mere 0.12% in 2021. This decline in export competitiveness places us at a disadvantage, especially when compared to economies like Bangladesh, India, and Vietnam, which have managed to expand their export capacities.”
This finding was made by PIDE researchers and economists in their recent brief titled “What Are the Factors Making Pakistan’s Exports Stagnant? Insight from Literature Review.”
The academic duo underlined key factors that have led to stagnancy in Pakistan’s exports, including low productivity of firms, lack of value addition and innovation, complex incentive mechanisms, limited export destinations, and inadequate investment in research and development. —NNI
