The Furniture Sector in Pakistan: Export performance and ... - TRTA i

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3.1.4 Dispute resolution For disputes arising under GATT 94, GATS and TRIPs, there is a common dispute resolution mechanism embodied in the WTO’s Disputes Settlement Understanding, (DSU). 3.1.5 Focus on trade in goods In this report focus is on trade in goods. Hence, further reference will not be made to the GATS while the TRIPs will be referred to wherever it is relevant. 3.1.6 Obligation of conformity Each member country of the WTO is obliged to ensure the conformity of its laws, regulations and administrative procedures with the agreement of the Organization (Article XVI (4) of the Marrakech Agreement Establishing the WTO). 3.1.7 Opportunities and challenges under the WTO regime Overview The central objective of the WTO is to help international trade flow smoothly, freely, fairly and predictably. The WTO’s rules with their trade liberalization orientation, have indeed led to a rapid expansion of the world trade. In ranking many achievements of the GATT-WTO system, among the most significant, is the deep reduction in developed-country tariffs from high double-digit figures in 1947 to low single-digit numbers today 3 . There has been also significant reduction in other barriers to trade. Under this liberal international trade regime there are both opportunities and challenges for Pakistan. No doubt Pakistan faces many challenges. At the same time, the multilateral trade dispensation has created many opportunities. If a proper strategy is adopted and the government plays a supportive and facilitative role, it can lead to a significant increase in international trade and substantially contribute to the economic growth. Hopefully ongoing trade negotiations would add to these opportunities. However, “the WTO is about providing opportunities – it does not provide guarantees nor does it provide all the conditions for participation in the global economy”. In short, Pakistan has to put its act together, for realizing the potential that has become available due to the trade liberalization. Action is to be taken by the Government agencies, trade bodies and above all by entrepreneurs themselves. As it has been aptly observed, “the business community has the primary responsibility for converting tariff reductions and liberalization commitments into opportunities for trade by adopting appropriate export promotion and development strategies” 3 See Patrick Macrory, Arthur Appleton and Michael Plummer, The World Trade Organization: Legal, Economic and Political Analysis, Volume-I (2005) p.109. 52 International Trade Centre
Current status of efforts to liberalize trade Currently (mid 2007), the ninth (and the first under the WTO) Multilateral Round of Negotiations (MTN) called the Doha Development Agenda (DDA) is in progress 4 (more correctly in a state of suspended animation). Earlier rounds have given great impetus to the growth of international trade by slashing tariffs mostly in industrial countries as well as elimination of non-tariff barriers such as quantitative restrictions. Following the Uruguay Round (the most important MTN held so far), average tariffs rates in developed countries on manufactures stand at an average of 3 % on imports down from the 5.5 % pre-Uruguay Round average, a 45 % reduction. Tariffs, however, on goods of export interest to developing countries still remain relatively high 5 e.g. on clothing and footwear. DDA has been launched to improve the situation of developing countries in the multilateral trading system through focusing on issues of principal concern to them. The progress of negotiation has been so far very slow and deadlines for reaching agreement have been repeatedly missed. Meetings to take forward the DDA process held in 2006 and 2007 turned out to be inconclusive and negotiations have been suspended. One comment from an influential periodical graphically describes the situation as the Doha round lying “comatose after five years of fruitless negotiations” 6 . Negotiations under the DDA on the Non-Agriculture Market Access (NAMA) cover the sector under study. Modalities are yet to be finalized on a Swiss formula (i.e. envisaging rate of reduction for a higher tariff to be greater than that for a lower one. For further details see: www.wto.org ) 3.2 Information on the WTO issues 3.2.1 Information flows (Upwards-downwards) Information flows, both upwards and downwards, on the WTO are depicted below: 4 5 6 See Hong Kong Ministerial Declaration, WT/Min (05), Dec 22, 2005 and for updates on the latest developments and pending issues visit www.wto.org. See I. Haque, Doha Development Agenda: Recapturing the momentum of multilateralism and developing countries, American University International Law Review, Volume 17 Member 5 Footnote 36. Also See Bernard Hoekman, Strengthening the Global Trade Architecture for Development: The Post Doha Agenda, Nov. 2001, at 2. The Economist, November 4, 2006, p.40 International Trade Centre 53
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The Furniture Sector in Pakistan
Page 3 and 4:
Acknowledgements The report was pre
Page 5 and 6:
Abbreviations AFTA AHEC AKTRIN APFE
Page 7 and 8:
Table of contents Acknowledgements
Page 9 and 10:
Box 3.1 Multilateral discipline of
Page 11 and 12: Executive summary This study sets t
Page 13 and 14: the extent possible maintain or imp
Page 15 and 16: 1 Background and objectives 1.1 EC
Page 17 and 18: 2 Furniture sector in Pakistan 2.1
Page 19 and 20: On the buyer’s side, there are gl
Page 21 and 22: According to the websites of import
Page 23 and 24: Global demand for furniture in main
Page 25 and 26: suppliers, both domestic and other
Page 27 and 28: Table 2.3 Pakistani furniture expor
Page 29 and 30: Figure 2.4 Distribution structure f
Page 31 and 32: freight rates have increased and do
Page 33 and 34: Price The prices of local machinery
Page 35 and 36: Indonesia has also announced a ban
Page 37 and 38: industry itself should support effo
Page 39 and 40: various counterparts, the supplier
Page 41 and 42: Box 2.7 UK Timber Trade Federation
Page 43 and 44: Figure 2.5 Simplified example on ch
Page 45 and 46: At least 70% of the wood used in ma
Page 47 and 48: Scope of joint ventures There exist
Page 49 and 50: • With FAO’s Forest Products an
Page 51 and 52: The contact information of many of
Page 53 and 54: Box 2.10 USAID initiative in the fu
Page 55 and 56: Opportunities Major opportunities m
Page 57 and 58: pressure on the price. There appear
Page 59 and 60: Pakistan does not export this furni
Page 61: 3.1.3 Functional scope The function
Page 65 and 66: 3.2.2 Information flow-upwards, i.e
Page 67 and 68: Commission (EC/EU) has established
Page 69 and 70: Figure 3.3 Relevant intensity of WT
Page 71 and 72: Box 3.2 Regional Trade Agreements (
Page 73 and 74: Trade Related Aspects of Intellectu
Page 75 and 76: Agreement on the application of san
Page 77 and 78: country or materially retards the e
Page 79 and 80: Relevance of the furniture sector T
Page 81 and 82: 3.4.2 Other countries’ access to
Page 83 and 84: Table 3.2 Top 10 buyers of the Paki
Page 85 and 86: Arabian market. Here again, there i
Page 87 and 88: • Material from China is being us
Page 89 and 90: 4.2 Obstacles and shortcomings - im
Page 91 and 92: Raw material recovery Raw material
Page 93 and 94: • Consistent policy for supportin
Page 95 and 96: A short-term but maybe a costly mea
Page 97 and 98: 5 Export services in Pakistan 5.1 E
Page 99 and 100: 5.1.3 Federation of Pakistan Chambe
Page 101 and 102: • Pakistan International Freight
Page 103 and 104: The lessons learnt here could be re
Page 105 and 106: 6 Conclusion and recommendations 6.
Page 107 and 108: 6.2 Critical success factors • A
Page 109 and 110: 6.4 Global value chains 6.4.1 Poten
Page 111 and 112: Benefits All timber tends to be air
Page 113 and 114:
• Optimise cutting; • Calculati
Page 115 and 116:
6.6.5 If we had US$100,000: A techn
Page 117 and 118:
• To modernise such a laboratory,
Page 119 and 120:
Annexes Annex A — Sources of info
Page 121 and 122:
• Federmobili information on the
Page 123 and 124:
• National Home Furnishings Assoc
Page 125 and 126:
International Trade Centre 115
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