KARACHI, March 7: The State Bank Governor Dr Ishrat Husain warned exporters on Thursday that too much focus on the US market even after the launch of the euro might lower export growth in future.

“There is an inherent bias (in US favour)...our exporters want to focus on the US market,” he told a seminar on Thursday. Export Promotion Bureau and Institute of Bankers Pakistan had jointly arranged the seminar titled: “Single European currency and its impact on Pakistan.”

“You have to have a basket (of trade zones) that includes the eurozone...the USA and Japan and also the developing markets,” he advised the exporters.

He said Pakistan’s exports to the eurozone currently stands at 22 per cent down from 25 per cent in early 90s adding that the US is the biggest export market for Pakistani goods at the moment.

“If we are not able to increase our share in the eurozone and the euro economy performs better than that of the US in coming years than our exports (as a whole) would go down,” the governor said. He said he could not predict whether the US economy would outperform the euro economy or the euro economy would do better than the US in future but showed the exporters how world trade pattern would change if the eurozone economic fundamentals might improve. “My advice to the exporters is that we should not be caught by surprise,” said Dr. Husain meaning that they must keep on trying to increase exports to the eurozone “even if there are some initial losses.”

Husain asked exporters to learn lesson from Korea and Japan —the two nations whose exporters marketed their products in the world markets in 1960s and 70s at prices cheaper than at home “to penetrate into the world markets.”

He said he was fully aware that penetrating into the EU market is difficult for exporters at a time when euro has been on the fall yet he urged them to increase their exports to eurozone as part of export diversification strategy.

He said unlike the US market where demand pattern has rather been uniform the eurozone buyers can be bracketed into different categories according to their income. The governor said Pakistani exporters must realise this and make efforts to cater to specific income groups of the eurozone buyers thereby increasing exports to the EU.

State Minister and Chairman of Export Promotion Bureau Tariq Ikram urged the exporters to get out of exportable surplus syndrome and produce and market goods and services according to specific needs of foreign buyers. “A 15 per cent increase in textile quota by the EU would not automatically enhance exports,” he said referring to the recent concessions won by Pakistan from the EU in recognition of its role in “the war against terrorism”.

He said the impact of the euro has to be significant on world trade as the eurozone economy is larger than that of the United States.

Tariq Ikram lamented that 80 per cent of Pakistan’s exports are marketed into 10-12 countries and advised exporters to move deeper into new export markets including Africa and central Asia.

He urged exporters to reposition themselves to enhance exports to eurozone after the launch of the single European currency.

Executive Incharge of Bank Alfalah Sirajuddin Aziz; Chief Executive Pak Gulf Leasing Co. A.B. Shahid; former federal finance secretary Aftab Ahmad Khan and chairman of banking & finance committee of FPCCI Mirza Ikhtiar Baig presented papers on different aspects of euro.

Chief Executive, Institute of Bankers Pakistan M.M. Malik and Vice Chairman of Export Promotion Bureau Ejaz Ahmad Qureshi also spoke about how the exporters could gain from the launch of the euro.