Posts tagged ‘trade’

July 8, 2011

Japan quake still hurting trade

Car manufacturing unit Japanese carmakers were some of the hardest hit, facing supply shortages and power cuts Japan’s current account surplus fell sharply in May, as the 11 March earthquake and tsunami continue to affect exports.


The surplus shrank 51.7% to 590.7bn yen ($7.27bn; £4.55bn) compared with a year earlier, said the Ministry of Finance.


However, that is less than most analysts had expected.


The data shows that while the economy continues to suffer from the disaster, it is recovering quicker than expected.


May’s fall in the current account surplus marks the third straight monthly drop after the earthquake and tsunami wreaked havoc in the north east of Japan.


In April the surplus was down 69.5%.

Trade deficit

Even as the supply chain recovers and manufacturers come back online exports are still suffering.


The data showed that exports fell by 9.8% in May from a year earlier.


While imports rose 14.7%, mainly because of higher energy costs.


That translated to the second-biggest trade deficit on record, the ministry said.


The current account is the broadest measure of a country’s trade with the rest of the world.

Advertisements
July 2, 2011

Transit trade: Insurance firms refuse to provide guarantees

After receiving clearance earlier this month, the Afghan-Pakistan transit trade hit another snag as insurance firms withdrew their support. PHOTO: FILE

ISLAMABAD: 

Insurance companies have refused to provide guarantees for Afghan trucks coming to lift cargo and goods imported under the new Afghanistan-Pakistan Transit Trade Agreement, causing a halt in trade, a commerce ministry official said.

“Since the new agreement came into force on June 13, no consignment has been cleared as insurance companies are reluctant to extend guarantees due to high risk involved in the trade,” he said.

Afghan transporters and traders have also termed the cost of insurance guarantees “unbearable” as this will increase their import cost.

To review and resolve the problem, the official said, a meeting of Transit Trade Coordination Authority, which was constituted to monitor and make the agreement effective, is expected to be called. Earlier, the two countries struck the new accord in a bid to check massive smuggling under the garb of transit trade, which caused losses of billions of rupees to Pakistan’s economy.

According to officials of the Federal Board of Revenue (FBR), Afghan transporters and importers have the responsibility to provide insurance guarantees. In the new agreement, it was agreed that bank guarantees would be provided for trucks coming from Afghanistan for lifting transit cargo and for value of duty on goods imported for the purpose. However, on the insistence of Afghanistan the bank guarantees were replaced with insurance guarantees, which would be returned on arrival of trucks and goods at Afghan destinations.

The new transit trade agreement has been put in place for a period of five years with extension of another five years on completion of the first term. However, the difficulties encountered at the very beginning are a cause for concern.

Published in The Express Tribune, July 2nd, 2011.

June 30, 2011

Line of control trade resumes after four weeks

SRINAGAR: 

Cross-Line of Control (LOC) trade has resumed on Wednesday after four weeks although on a low note as only 39 trucks were exchanged, according to Press Trust of India.


Total of 24 trucks carrying mainly red chilli, tamarind and other spices crossed to Azad Jammu and Kashmir while 15 trucks loaded mostly with dry fruits crossed to this side, officials said. Total value of goods exchanged was Rs32.6 million, record low for 2011.


Trade was at its peak in April when around 200 vehicles crossed the LoC and exchanged goods worth around Rs200 million in two days.


Cross-LoC trade is conducted every Tuesday and Wednesday on barter basis, but was suspended since May after traders accused Indian authorities of neglecting their demands.


Traders have demanded exempting cross-LoC trade from purview of Value Added Tax, as they claimed that trade between divided parts of Kashmir should be treated as intra-state business.


June 30, 2011

Strengthening trade: Food exports rise 35% to Rs338 billion

Decreasing quantity of export and higher revenue generation suggests that the increase is more of a fallout of the devaluation against the dollar more than anything else. DESIGN: MOHSIN ALAM

KARACHI: 

Food exports have increased 35 per cent to Rs338 billion in the first eleven months of the current financial year with the largest share of revenues coming from rice.


The total quantity of rice exported was 3.4 million tons, which generated revenues of Rs168 billion. However, it is a worrying factor that the quantity of rice exported dropped by around 10% even though revenues generated showed an increase of 1.24%. The fact that rice export revenues fell 0.7% in dollar terms indicates that the increase is more of a fallout of the devaluation against the dollar more than anything else. This drop would have been even worse had it not been for the increase in the country’s basmati exports.


While rice exports made up about half of total exports in the food group, they were not the reason for the increase in total revenues from this group.


Because of the policy of not exporting wheat one year and then exporting it the year after, revenues from this commodity were Rs41 billion compared to just Rs61 million for the corresponding period last year. The total quantity of wheat exported surged from 3,500 tons to 1.4 million tons and was responsible for a 12% increase in the overall value of food group exports.


The other significant boost to overall exports came from smaller sectors like meat and meat products which registered a 59% increase in rupee terms, increasing from Rs7.5 to Rs 11.8 billion. Tobacco exports almost doubled in rupee terms, generating Rs2.2 billion compared to Rs1.1 billion in the same period last year. Vegetable exports also depicted a healthy increase both in quantity and value. Quantity increased from 427,821 tons to 590,503 tons and revenues increased from Rs9.2 million to Rs17.6 million. Fish and fish products registered a healthy increase of over 20% from 98.142 tons to 119,358 tons and earned the country Rs22.9 billion in revenues, a healthy increase of over 30%.


Fruit exports on the other hand managed to register a 19% increase from Rs18.8 billion to Rs 22.9 billion even though quantities fell by over five per cent from 646,516 tons to 612,952 tons. Spices also registered a fall in quantity, dropping from 15,408 tons top 14,146 tons but revenues increased from Rs3.16 million to Rs3.7 million.


The country earned Rs168 million from exporting leguminous vegetables (pulses), a new entrant to the export list.