China will update its free trade agreement with Pakistan

Pakistan’s Interim Commerce Minister, Gohar Ejaz, led a pivotal delegation to China, presenting a series of strategic proposals aimed at bolstering economic collaboration between the two nations. Foremost among these proposals is the call for amendments to the existing Free Trade Agreement (FTA) between China and Pakistan. The proposed revisions seek to align Pakistani products more favorably with the China-ASEAN agreement, potentially enhancing market access and preferences for Pakistani goods within China.

In addition to this, Pakistan has requested trade finance in yuan amounting to $5 billion. This initiative is designed to reduce dependency on the US dollar, thereby mitigating currency risks and facilitating smoother trade operations between the two countries. This move underscores Pakistan’s commitment to diversifying its currency reserves, fostering greater stability in its international trade transactions.

Concurrently, the proposal to allocate $5 billion in yuan for financing investments, with a specific focus on facilitating the relocation of Chinese companies to Special Economic Zones (SEZ) or Export Processing Zones (EPZ) in Pakistan, demonstrates the nation’s eagerness to attract foreign investment and strengthen its industrial landscape. This initiative not only supports economic growth within Pakistan but also signifies a deeper collaboration between the two nations, paving the way for enhanced economic cooperation and potential long-term partnerships.

In summary, these strategic proposals put forth by Pakistan reflect a concerted effort to enhance economic ties with China, diversify trade currency, attract foreign investment, and align trade preferences, signaling a commitment to mutual economic growth for both nations.

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