Experts say Pakistan could be the third most fortunate beneficiary from US-China trade war
High prices on Chinese products in the US market give Pakistani goods an edge.
The US-China trade war could lead to many business and trade opportunities for Pakistan, according to economic experts. As per Nomura Securities strategies, Pakistan could be the third most fortunate beneficiary from this war, says a report published in China Economic Net.
“The trade war between China and the United States is getting bigger and bigger by the day… and the demand for goods is not declining (in the US market), Pakistan needs to explore ways so that it can benefit from this war.” – said Abdul Razak Dawood, an adviser to the prime minister.
These statements have expectations attached to them. There are three ways that Pakistan can turn this economic feud into its favor and establish it as a key player in world economics in the international market.
High prices on Chinese products in the US market give Pakistani goods an edge:
Firstly, the high prices on Chinese products in the US market give Pakistani goods an edge in the US market. It has been difficult to compete with Chinese products in international markets because of their low production cost, due to inexpensive labor and economies of scale of Chinese firms.
The high tariffs have made these cheap products more expensive for buyers in the US.
These higher prices have resulted in a decrease in their demand and have left a void that can potentially be filled by substitute sellers, like Pakistan.
“The China-US trade war has put Pakistan in an advantageous position and we have become more competitive than China in some areas like textiles. It offers an opportunity for Pakistan to boost its exports to the United States as well as revive the closed manufacturing capacity (mostly in Punjab).” Ehsan Malik, Pakistan Business Council’s CEO, stated.
Some Chinese products whose prices have increased in the US are textile, surgical tools, plastics, footwear, fishery, packaging, pharma, kitchenware, furniture, jewelry, and engineering. Pakistan has the capacity and potential to produce a large amount of these products as exports for the US market. However, the manufacturing of items from each category will depend solely on the resources present in Pakistani industries, like, Pakistan has an excellent industry for sportswear.
What are your views on this? Share with us in the comments bar below.