Pakistani exporters see tariff as opportunity for growth

In Karachi, discussions surrounding the recent 29% reciprocal tariff imposed by the United States have led to differing opinions among multinational companies operating in Pakistan. While some businesses view this tariff as an opportunity, Overseas Investors Chambers of Commerce and Industry Secretary General M. Abdul Aleem emphasized that it could enhance Pakistan's position in the global market, particularly if businesses are willing to adapt their practices. Furthermore, he highlighted the potential for Pakistan to serve as a manufacturing and export hub for countries facing higher tariffs, especially in sectors like textiles and goods. Meanwhile, Pakistan Business Council Chief Executive Ehsan Malik voiced a contrasting perspective, stating that imposing counter-tariffs is not a viable option for Pakistan. He emphasized the importance of the EU's GSP+ programme, which allows Pakistan duty-free access to European markets, noting that exports to the EU significantly surpass those directed towards the U.S. To sustain this access, Malik argued, Pakistan must address critical compliance gaps related to human rights and environmental standards. Ehsan Malik also pointed out that the recent tariffs are likely to reduce demand for Pakistani exports, necessitating a strategic response. Although an initial impact on exports is expected, he believes there exists a hidden advantage in U.S. consumers seeking more affordable textile products, potentially benefitting Pakistani exporters. However, he cautioned that any changes to Pakistan's export mix that would allow for a competitive edge over countries like China, Vietnam, Bangladesh, and Indonesia would take considerable time and effort. Despite the challenges presented by the tariffs, the discussions in Karachi reflect a broader sentiment where adaptation and strategic planning may offer pathways for Pakistani businesses to thrive. While immediate impacts from the tariffs are unavoidable, forward-thinking approaches toward compliance and quality in production could ultimately reshape Pakistan's economic landscape in the aftermath of global trade shifts initiated by the U.S. administration.