ISLAMABAD, July 16: Economic Cooperation Organization (ECO) has agreed to sign a Free Trade Agreement (FTA) in 2006 to facilitate greater trade and investment activities in the region.
Official sources told Dawn here on Saturday that the 10-member ECO ministerial meeting held in Istanbul (Turkey) from July 5 to 7 had decided to initially promote trade and investment activities in the region by reducing duties and providing incentives to the member countries in the absence of the proposed FTA.
In this behalf, it was also agreed to sign an investment agreement among the member countries.
Five of the ECO members had signed trade agreements and the rest had assured to sign them by December 2005.
Pakistan, Iran, Turkey, Afghanistan and Azerbaijan had signed the trade agreements while Khazkhstan, Kyrgyzstan, Tajikistan, Turkeministan and Uzbekistan were still to sign these agreements.
The sources said that a high-level expert group of ECO countries had been entrusted with the task of ensuring early signing of the FTA.
“This group is now engaged in finalizing rules and regulations and working out other formalities to sign the free trade agreement preferably early next year,” he said.
He said the Istanbul meeting had decided to adopt fast track approach to facilitate greater trade and investment activities in the region so.
Non-existence of modern technology, adherence to agro-based industry, lack of skilled labour force, outdated trade practices and non-availability of modern infrastructure were said to be some of the major issues in the ECO that needed drastic improvement.
“We have meagre contribution of only 1.5 per cent in total trade of the world and even less than 1 per cent share in total Foreign Direct Investment (FDI) of the world which has regarded ECO as an unsuccessful grouping,” said another source.
He urged the ECO countries to hold annual ECO industrial exhibition in each member country on rotation basis. The ECO, he said, though had more than 7 per cent GDP growth rate and occupies 25 per cent mineral resources of the world, its potential was not reflected in the lives of the common man of the region. Poverty and unemployment were most concerned challenges for the region, he added.
Earlier, ECO expert group had met in Islamabad on March 3 this year which was a follow up of its meeting held in Ankara in September 2004. During the Islamabad meeting, technical papers on mining and metallurgical industry, electrical and electronic home appliances industry, textile, leather and clothing industry, automotive parts industry, transportation industry, agriculture and food processing industry, chemicals and petrochemicals industry and energy equipment and machinery industry were presented to promote trade in these fields among the member states.