Islamabad: The Pakistan Economy Watch (PEW) on Sunday expressed concern over falling exports to EU despite trade relaxations terming it a very alarming development which can damage foreign exchange reserves.
According to data compiled by EU trade officials Pakistan shipments to EU fell by 4.5 billion dollars in in first eight months from January to August compared to the last year.
Exports to all 26 EU countries dwindled in double digits save Luxembourg which is a small trading partner, said Dr. Murtaza Mughal, President PEW.
He said that exports to UK fell by 26 percent while exports to Germany witnessed a fall of 22 percent. Exports to Spain were down by 18 percent, Italy 29.9 percent, France 34.5 percent, Belgium 29 percent, Netherland 20.5 percent and 22.6 percent fall was recorded in exports to Sweden.
It has been more than a year and a half now that exports have been falling consistently which was termed a temporary state of affairs by the policymakers.
The trade deficit is growing while exporter associations have started sending out SOS messages due to disastrous state of affairs.
Dr. Murtaza Mughal said that the trend must be reversed otherwise dwindling exports would wipe out forex reserves as tax base could not be broadened despite some half-hearted efforts.
The situation will result in unemployment, reduced revenues and closure of export-oriented industries, he warned.