Textile and the EU-Pakistan Trade Relations:
Past perspective and Future prospects
by Akber Sheikh
All Pakistan Textile Mills Association
Aptma’s Contribution towards Pakistan’s Textile Industry
ECONOMY
Textile industry contributes 8.5 % of GDP.
Aptma Contribution 50% of 8.5% Textile Contribution towards GDP. Aptma contributes
to GDP $ 7.5 billion
EMPLOYMENT
Aptma provides direct employment to 1.0 million work force out of total of 3.5 million in
the textile sector
Aptma provides 3 million Indirect jobs
AGRICULTURE
Pakistan is the 4th Largest Producer of Cotton in the world.
100% of 11.5 million bales cotton produced in Pakistan is consumed by Aptma members.
And contributes Rs. 180 billion in agriculture economy.
Aptma members Imports 3.5 million bales of cotton from the world market. And
produces specialized yarn and fabrics for contamination free, long staple and ELS
programs for high value added Brands in the world
EXPORTS
Total Textile Exports of Pakistan: US$ 10.65 billion.
Direct Exports by Aptma: US $ 4.80 billion
100% of cotton & synthetic yarns & 50% of greige and dyed fabric for the remaining
textile exports supplied by Aptma.
Trade Balance (World)
000 US$
Trade Balance – EU
Million US$
(Million Euro)
2007 2009
2005
20026 15601.1
Textile Imports from World 17328.6
61843.8 59053.3
Clothing Imports from World 52778.4
83876.8 76663.4
EU Total Textile & Clothing Imports 72112
(Million Euro)
Share % 2007 Share% 2009 Share%
2005
3.1% 2670.5 3.2% 2446 3.2%
IMPORTS FROM PAKISTAN 2227.5
31.5% 29153.7 34.8% 31535.6 41.1%
IMPORTS FROM CHINA 22698.1
7.7% 6503.5 7.8% 6116 8.0%
IMPORTS FROM INDIA 5578.1
5.2% 4666.5 5.6% 5332.6 7.0%
IMPORTS FROM BANGLADASH 3717.8
War on Terror:
Consequential Impact
Country perception
Travel Advisories
Travel visa difficulties
Buying houses shifted from
Pakistan
War on Terror
Consequential Impact
30% Capacity Impaired. Resultant
Unemployment.
Declining Textile Exports
Declining Investment.
Industry Operating Below Capacity.
Circumstantial Defaults.
Losing Market Share to Competitors
Simple Average Tariff Levels of Pakitan (2006)
Proportion of Tariff on Textile, Apparel & Leather to
Tariff on All Goods is 1.31
18.90%
14.40%
20.0%
10.0%
0.0%
Textile, Apparel & Leather All Goods
Tariff Peaks
Average Tariff Tariff on Textile & Textile Articles
13.96
12.86
8.03
7.13
1.93 2.21
1.31
0.8
USA Canada EU Japan
Tariff Peaks: EU
12 12 12
12
10 7.13
8
6
4 0.8
2
0
Average % Average %MB Trousers MB Shirts MB Jerseys
Tariff Tariff on
Textile &
Textile Articles
EU Anti dumping cases against Pakistan
Bed Linen I Complaint Lodged Sep 1993 Investigation Terminated 9 Jul 1996
C. Fab. I Initiated 20th Jan 1994 Terminated 19 Feb. 1996
C. Fab II Complaint Lodged 8 Jan 1996Duties lapsed 18 May 1997
Bed Linen II Initiated 13 Sep 1996 Duties Expired 30 Jan. 2002
C. Fab. III Complaint Lodged 26 May 1997 Duties Lapsed 15 Oct. 1998
B. Linen III Initiated on 18 Dec 2002 Duties Expired on 5 Mar2009
Duty Free Jan. 2002 to Jul 05
Textile Exports Share in EU (Woven Garment Exports)
100' kg %age Share with respect to World
Total World BANGLADESH China India Pakistan
2000 10,085,114 9.69 17.36 5.21 3.47
2001 11,133,217 9.31 16.35 6.15 3.64
2002 14,021,195 8.18 30.95 4.77 3.74
2003 15,620,803 9.58 37.64 4.54 3.48
2004 15,625,655 10.81 36.49 3.73 3.52
2005 17,193,930 8.54 46.41 4.26 3.22
2006 18,428,962 9.83 44.52 4.40 3.28
2007 19,208,661 8.50 50.48 4.49 3.15
2008 18,985,966 8.81 54.21 4.61 3.16
Source: EuroStats
Textile Exports Share in EU (Knitted Garment Exports)
100' kg %age Share with respect to World
Total World BANGLADESH China India Pakistan
2000 11,580,764 12.17 18.09 5.99 2.81
2001 30,665,429 5.83 17.69 3.33 1.11
2002 13,769,786 11.99 21.21 6.50 2.70
2003 16,603,378 14.25 23.38 6.17 2.85
2004 17,647,797 16.16 24.27 6.21 3.31
2005 18,334,040 16.68 36.36 7.02 2.62
2006 21,444,196 16.73 30.40 6.28 2.78
2007 22,741,306 16.42 35.81 6.34 2.46
2008 24,094,958 16.92 42.32 6.16 2.32
Source: EuroStats
Textile Exports Share in EU (Home Textile Exports)
100' kg %age Share with respect to World
Total World BANGLADESH China India Pakistan
2000 7,718,027 2.95 20.63 13.77 11.90
2001 8,062,634 3.03 19.64 13.38 12.82
2002 8,801,627 3.10 20.04 11.93 15.36
2003 10,098,481 2.86 22.68 11.95 15.16
2004 11,572,861 3.57 26.07 12.80 14.15
2005 7,718,027 5.55 50.72 21.08 20.42
2006 13,920,160 3.87 32.64 12.28 12.56
2007 14,785,627 4.24 36.87 13.35 13.83
2008 15,863,681 4.50 37.36 12.41 13.48
Source: EuroStats
International Textile & Apparel Trade Potential
$ 800b
900
800
700
600
500
397
400 351
300
281
200
100 201 232 258
0
2005 2008 2010 2014
Textiles Apparel
Source: Technopak and Werner Analysis
APTMA VISION 2014
Textile Policy – (2009 – 2014)
Export targets
To Achieve 3% share in Global Textile & Clothing
Exports from the current level of 1.8%
Exports Target US$25 billion
Investment US$5 billion
17
Adversely Impacted Economy
Concept of adversely impacted
economy is same as that used in
Psunami affected countries (EU) OR
Reconstruction Opportunity Zone
(US).
Free Trade Agreement
EU-India FTA, negotiation going on
EU-Pak FTA should follow same time
table
EU-PAK Energy Cooperation
TechnicalCooperation (Nuclear and/or
Non-Nuclear)
Financing of new installations
SAARC
SAARC cumulation rule should not be
circumvented by counteracting
subsidies
GSP Plus Status
Denied Because
2 Conventions not yet ratified
GSP exports 1.48/(Limit 1.00)
TRADE PROMOTION ASSISTANCE
Energy conservation
Better agri practices
Envi-labor compliances
Pak-EU land route transportation
Trade remedy measure
Eco labels
Doha round
APTMA Request
Pakistan should be declared adversely
impacted economy (AIE)
GSP export unit for AIE developing
countries should be increased from 1%
to 3%.
Thank You
