UNISAME URGES MOC TO SEEK DEFERRED PAYMENT FACILITY UNDER AVALIZATION FOR IMPORTERS…. The Financal Daily 26/6/23

The Union of Small and Medium Enterprises (UNISAME) has invited the attention of the ministry of commerce to approach the Republic of China to facilitate the importers of Pakistan to import on deferred payment under avalization supported by trade diplomacy under an agreement.
President UNISAME Zulfikar Thaver said this deferred payment would be mutually beneficial to both the countries as Pakistan would then be importing almost 90% items from China ranging from cars, parts, machinery, raw materials, chemicals, synthetic items and many more exclusively from China and not from other countries like Japan, Korea, Taiwan, Malaysia, Thailand, Singapore , Indonesia and others because China is a very big and competitive capable supplier. China would have in Pakistan a big market and most of our demands would be exclusively met by China. It will be an indeed good opportunity for China and of course for Pakistan it would facilitate deferred payment.
Thaver said secondly as far as payment guarantee is concerned Pakistan can offer a sovereign guarantee and further details can be worked out to the satisfaction of China. The State Bank of Pakistan can also bring avalization into practice.
It is pertinent to note that in Pakistan avalization was introduced through Habib Bank Ltd when rice was exported to Yemen by SZT Corporation which was owned by Thaver.
Pakistan is now facing a very tough situation as many units are closing down due to shortage of raw material as payment of import bills have become very difficult and different countries of the world are not inclined for deferred payment.
With China, Pakistan has friendly relations and moreover trading can be done through Gwadar sea port as China and Pakistan both hold key interest in Gwadar and it would be wise to promote Gwadar port.
It is pertinent to note that Pakistan needs the deferred payment facilities from a single, big and capable country like China to cover all its requirements and would be able to cover all its requirements from China.
UNISAME Council members said Mincom must seek special deferred payment facility from China and later on a currency swap agreement could be done to enable import and export to one another in own currency.
In this connection although vide Exchange Policy Department circular letter number 10 dated 23rd June 2023 the restriction on imports has been withdrawn yet it might be a little difficult in the 2 forthcoming shipping periods July 23 to December 2023 and January 2024 to June 2024 and the importers must go slow and import only that which is necessary. As the State Bank of Pakistan has very rightly asked the commercial banks to prioritize imports. It is very important that the commercial importers also import only that which is not available and not made in Pakistan.

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