Criticism on Trade Policy 2009

[Asif Amin]

Trade policy 2009

Business Recorder 30-07-09

What does one call a policy with a lot of "woulds"? Perhaps, policy inaction. But this year's trade policy was even worse. It was a great backgrounder with nearly all the problems neatly highlighted, but it missed the whole point by failing to provide any real solution. The complete text of Strategic Trade Policy Framework (STPF) 2009-12 revealed lack of homework on part of the ministry.

For instance: it said that within three months of the announcement of the STPF 2009-12, commerce ministry would critically look at those business processes which are hampering Pakistan's export competitiveness. Fair enough. But shouldn't they have done this research earlier because three months means one-fourth of fiscal year gone in just the study. Then discussions, then implementation and then perhaps we would need post-policy measures to bring about these changes, considering that improving business processes require many technological developments which most likely have to be imported.

Likewise the text says that Commerce Ministry plans to re-design the National Tariff Policy to realise certain objectives. But then again such work should have been done earlier so it could be announced with the STPF; unless of course, the ministry thinks that the STPF and tariff policy are mutually exclusive. If that's the case then it raises questions about the comprehensiveness of the policy itself.

Similarly, not much has been said on how to actualise the structural institutional reforms, how to inform small producers about exports routes, build strategic trade partners and provide latest technology to meet these objectives.

It talks about rationalising tax, but fails to mention any tax rate. And the same is the story with their other plans. The ministry said it 'would' integrate local productive capacity with global supply chain, it 'would' take measures for technological up-gradation, 'would' ensure promulgation of Geographical Indication law to lower poverty, 'would' take steps for market diversification, 'would' promote value addition among many other "woulds". Makes one wonder that if all these things had to be done later; then what was the ministry doing for all these months.

Besides lacking homework and actionable policy measures, the STPF also lacks comprehensiveness. There is no word on how to boost shipping industry to support higher amount of trade. No actionable statement on how to attract foreign direct investment. Little mention on how to improve human capital across the sectors and neither any talk of accurate data collection, without which all policy measures seem like a façade.

In a nutshell, the policy has nothing much to say apart from showing a rosy picture with no concrete steps to substantiate. It has many generic steps, but nothing specific and thus misses the much required structural institutional reforms to lift ailing industries out of the sea bed.

[digitals2_t3]

I thinks this policy is nice !


See This