President, Karachi Chamber of Commerce and Industry (KCCI) Khalid Firoz has urged the government that Export Processing Zone (EPZ) status should be given to all export oriented industries.
In a communication to the government, he said that the trade policy for the year 2005-06 is likely to be announced soon in which all labour benefits, eg social security, EBI, group insurance etc should be paid to workers in the shape of State Bank vouchers.
He said that National labour card to be brought under one head namely "worker benefit fund".
The chamber chief suggested that the use of house bill of lading for export shipments be strictly prohibited. He said that the State Bank of Pakistan circular No 23 dated February 19,1992, which is the root cause of misuse, be withdrawn. He proposed that an effective mechanism for disposing of the freight subsidy refund cases be evolved to avoid inordinate delay in payment.
He noted that Pakistan's exports is manly concentrated in a few items namely cotton and cotton-based products, leather, rice, synthetic yarn, textile and sports goods. These five categories account for 79 percent of the total exports while cotton-based products category alone contributes over 62 percent. He said that the export-base needs to be broadened by introducing more high-tech and high value added goods.
Regarding rates of export financing, he said that after having bottomed-down at 3.5 percent in June 2004, it has now been raised for the month of July 2005 again as high as 9 percent, posing problems of meeting the export orders particularly by small and medium enterprises (SMEs).
He said that at least for the productive sector including export, the lending rate as well as export refinancing rate must not be enhanced in order to maintain the ongoing tempo of economic growth.
He said that it would be most appropriate if in the face of fierce competition in a global market of post-quota regime, the rate of export refinancing be capped at 4 percent. The chamber chief noted that Pakistani products would also face greater and tougher quality standards, as well as tightening of the intellectual property regime in export markets.
He said in support of the export drive, the government should establish an 'export-import bank' (Exim Bank) to spearhead specialised export finance for raising the value and volume thresholds of exportable merchandise.
He said that the setting up of such a bank was envisaged in trade policy almost two years back, but the proposal could not be materialised.
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