ISLAMABAD, Nov 29: The member countries of the Economic Cooperation Organization (ECO) have, in principle, has agreed to declare the region as a free trade area shortly.

Official sources told Dawn here on Saturday that the Regional Planning Council of ECO is meeting in Istanbul on December 4 to 6 to discuss various issues including increasing trade relations among the member countries specially by making the region a free trade area as early as possible.

The ECO, formerly known as Regional Cooperation Development (RCD) now consists of Pakistan, Iran, Turkey, Afghanistan and the six Central Asian Republics.

Sources said that currently trade among the ECO countries was less than 2 per cent of their Gross Domestic Product (GDP). A broad consensus to substantially enhance trade had been reached among the members of the ECO.

The Istanbul meeting would discuss the progress on two agreements — Transit Trade and ECO Trade Agreement. The meeting, the sources said, would gauge the existing resources of the member countries including oil, gas, minerals and ports so as to determine the extent of possible increase in trade in terms of the GDP. “So far the ECO has remained a non-starter and one of the major reasons for its being ineffective is the continued political instability in Afghanistan,” a source said.

Also the lowering of tariffs will come up for discussion so that mutual trade could be increased. While Pakistan’s maximum tariffs had been reduced to 25 per cent, it was much higher in other countries specially Iran (about 40 per cent) which needed to be lowered.

The Chief Economist Planning Commission Dr. Pervaiz Tahir will lead the Pakistani delegation at the Istanbul meeting.

“No doubt there exists a lot of potential to substantially increase trade among the ECO countries,” he said.

When contacted he said that export group of the ECO on trade had met earlier and studied how could there be more trade within the organization. He agreed that regional forums elsewhere were thriving and contributing a lot to improve their trade and economic cooperation.

“The ECO countries do realise that cooperation among them is negligible, which should increase significantly,” the chief economist of the Planning Commission said.

More efforts, he believed, were required to make the ECO vibrant and that various future meetings of the organizations were expected to take up the issue seriously. The bureaucratic approach needed to be discouraged to achieve the objectives of having greater trade and economic cooperation among the member states, he said.

Pakistan’s exports to ECO countries stood at $317.764 million in 2001-2002 against $290.717 million in 2000-01.

Officials concede that Pakistan’s share in world trade is very small. About two-thirds of Pakistan’s trade is concentrated in a group of 12 major trading partners. Asian countries, including the Middle East, take about 46 per cent of Pakistan’s exports and provide half its imports. European countries account for 33 per cent of Pakistan trade (import and export).