Demand for revamp of ECO Trade Agreement

KARACHI: FPCCI and ECO Chamber of Commerce and Industry President Atif Ikram Sheikh has urged for a revamp of the ECO Trade Agreement, aiming to boost intra-regional trade and make the ECO region a more united and competitive economic bloc. Sheikh highlighted that the ECO region currently contributes to merely 4 percent of global trade, while intra-regional trade makes up around 8.75 percent, both figures being considerably lower than their true potential.

He emphasized the region's significant economic advantages, such as abundant hydrocarbon and mineral resources, a youthful and skilled workforce, strategic road and rail links connecting Asia with Europe, and proximity to key markets like China, India, and Russia. However, Sheikh pointed out that issues like high tariffs, non-tariff barriers, limited product diversification, trade payment difficulties, and regulatory disparities are still impeding regional trade.

He recalled that the ECO Trade Agreement was signed in 2003 and came into effect in April 2008, with the aim of creating an ECO Free Trade Area. Nevertheless, disparities in tariff structures, incomplete product lists, and concerns about equitable benefits have hampered its proper implementation. Sheikh stressed that the ECO Trade Agreement should not remain just on paper and called for addressing outstanding issues through continuous negotiations.

He also proposed a balanced approach to tariff cuts, broader product diversification, investment to enhance regional competitiveness, and improved mechanisms for trade-related payments. Additionally, Sheikh stressed the need to lower transaction costs, boost regulatory transparency, facilitate e-commerce and digital trade, and develop regional transport and logistics infrastructure.