LAHORE, April 15: The US invasion of Iraq might not have affected Pakistan’s foreign trade, but the SARS (Severe Acute Respiratory Syndrome) scare is certainly hurting its basic textiles (yarn and fabric) exports to Hong Kong.
“Though it’s difficult to predict the quantitative loss of our exports of textiles to Hong Kong or other SARS-affected countries at this point, the outbreak of the disease has certainly hampered our contacts with buyers there,” Punjab Aptma vice-president Mr Arif Saeed told Dawn here on Tuesday.
The disease has claimed some 143 lives worldwide so far and is believed to have infected at least 3,400. Hong Kong and China are the worst hit.
The disease is expected to reduce the growth rates in the Far East Asian economies with Hong Kong taking the brunt of it. It is said to have badly affected consumer spending, business operations and harmed confidence and consumption in Hong Kong which would result in an economic slowdown.
The scare of the disease is said to have considerably impacted the exporters’ traffic to Hong Kong, the single biggest market of Pakistan’s yarn, due to cancellation of their plans to visit that country. “This pause is going to leave considerable impact on our trade with that country in future,” says Mr Saeed. “When we trade in a commodity such as yarn or fabric, we need to regularly visit the buyers for maintaining contacts with them. It is this contact that we are unable to maintain in the current circumstances.”
Pakistan exported 153,389 kilograms of yarn valuing at $317.130 million in the fiscal year 2000-01, down by some $139.178 million from 1996-97.
Similarly, Pakistan exported 147.096 kilograms of fabric to the tune of $108.846 million during 2000-01, down by $125.525 million from 1996-97.
“Our yarn and fabric trade to Honk Kong has seen ups and downs in the last few years. There are years when our exports have been drastically reduced. However, the export of yarn has been picking up since 1998-99, when it went down to $261.525 million,” an Aptma official says.
He says it would take some months before the impact of SARS on Pakistan’s textile trade with Hong Kong became known.
Before the outbreak of SARS, Pakistan’s exporters were already perturbed on Hong Kong’s decision not to allow them entry without visa.
“We were already worried that we may not be able to travel to Hong Kong as frequently as before. But the fear of SARS has taken precedence over that worry. Now we are far more concerned about (contacting) SARS than visa problem,” says Mr Saeed.
It is pertinent to mention that Pakistan’s exports of yarn are declining over the years as a consequence of an increase in local consumption. Domestic consumption of yarn has gone up to 70.4 per cent of the production of 1.818 billion kilograms during the year 2001-02 from merely 52.52 per cent in 1990-91.
“The increase in local consumption of yarn indicates the extent of value addition achieved by the local textile industry over the years,” says the Aptma official.
With the increasing local consumption, the yarn production has also been rising and has almost doubled during the same period to 1.818 billion kilograms from 1.055 billion.
“Though local consumption of yarn is increasing, we need to be worried about even slightest drop in its exports because we still have enough surplus to sell,” Mr Saeed said when asked why was he so much worried about the possible impact of SARS on yarn exports to Hong Kong?
