Pakistan, Turkiye to expand SEF

MUSHTAQ GHUMMAN

ISLAMABAD: Pakistan and Turkiye are likely to expand Strategic Economic Framework (SEF) including Trade in Goods Agreement, branded as FTA, during the visit of Turkish President Recep Tayyaip Erdogan next week, well-informed sources told Business Recorder.

Erdogan is scheduled to land in Islamabad on February 12, 2025 and will stay two to three days aimed at attending 7th High Level Strategic Cooperation Council (HLSCC) session to be held on February 13, after a gap of nearly four years.

Ministry of Foreign Affairs (MoFA) is actively busy in giving final touches to the roadmap for enhancing Pakistan-Turkiye economic, trade and investment cooperation to be discussed at the highest level between the two countries, the sources said. Currently, both countries are implementing the 71-point action plan of SEF, which will either be expanded or some fresh arrangement would be made if suggested by the Turkish side.

“The major expected outcome of the visit will be the initiation of negotiations on expansion of the Trade in Goods Agreement, inclusion of investment, digital trade, removal of non-tariff barriers and further tariff concessions which would eventually facilitate trade and investment efforts and enhance trade beyond its current stagnation,” the sources added.

With Pakistan, Turkey has shown deep interest to further improve trade relations and taken the stagnation trade of around $ 1.3 billion to $ 5 billion. Eventually, this initiative will increase the trade performance of both sides and may create a win-win situation for both countries, the sources continued.

In this context, the Heads of States will meet in Islamabad on February 13, 2025 and both sides will discuss measures to liberalise trade through expanding the scope of Trade in Goods Agreement (TGA). The challenges faced by Pakistani textile sector in Turkish market as well as continued market orientation for traditional and non-traditional goods will surely improve export performance of Pakistan.

“With inclusion of digital trade (information technology and e-commerce) in the bilateral trade stream and investment in export-oriented industry besides infrastructure will surely increase opportunities for Pakistani firms in global and Turkish marketplaces,” the sources further added. Turkiye imported goods worth $ 396 million from Pakistan during January to November 2024. The figures are likely to reach around $ 440 million during the full year.

The major products imported from Pakistan include, cotton yarn and fabrics, iron and steel, knitted and crochet textiles, arms and ammunition, lead and articles, aircraft parts, sugar and confectionary, rubber tyres and tubes, surgical and sports goods.

Regarding promotion of IT, the efforts were initiated in December 2022 to add IT as an important and futuristic product in the export strategy and annual business plan.

As a result two major Organizations in the IT and its services were indentified namely Tuyfed (Software Developers Association of Turkiye with more than 200,000 member companies) and the IT Council of Diek (Economic Relations Board of Turkiye). An online virtual session between Pakistani and Turkish IT Companies was arranged in February 2024 followed by the participation in an IT Summit held in March 2024 which was organized by Tuyafed. Resultantly, more than 50 companies from both sides established connections with each other. For 2025, a second large scale interactive session is being planned for Fintech, Gaming, Software & AI developer companies. At the same time the proposed expansion of TGA between the two countries is part of the agenda of including IT and e-commerce/digital trade as a sector for increasing trade and investment opportunities. An MoU will be signed during the 7th HLSCC on February 13, 20255 which is expected to set out a viable roadmap for the IP collaboration and digital trade between the two countries.