Magazine article Economic Review

Prime Minister's Visit to South Korea

Magazine article Economic Review

Prime Minister's Visit to South Korea

Article excerpt

The present government of Pakistan under the dynamic leadership of Mohtarama Benazir Bhutto is very keen to establish close relations on commercial and industrial levels with the developed countries all over the world, particularly USA, China, Japan France, UK etc. Moreover, she gives particular emphasis on her newly coined two slogans "Look East" and "Trade not aid", because she believes with all certainty that east has more potential than the West, and that "The time of aid has come to an end and the era of trade has dawned". She, therefore, holds the view that intimate relations with the developing countries of Asia should be established. With that end in view, she sent a number of envoys to several countries, and even visited personally some of them in order to explore various aspects of trade and industries, and hunt up new scopes, avenues, and fields for economic and industrial relations. Consequently, she cooperated whole heartedly in the matter of expansion of ECO, and strengthened friendly relations with most of the muslim and other Asiatic countries.

So far as Korea is concerned, Pakistan recognises North Korea and South Korea both. The Prime Minister had already visited Pyongyang, the capital of the Peoples Democratic Republic of Korea (North Korea) in December 1993, and had very purposeful talks with the President, other top leaders, business magnates and industrial tycoons of that country, while Asif Ali Zardari, her spouse and MNA, of late inducted as full fledged Minister of Investment led a trade delegation consisting of 70 members including 30 top industrialists and traders to RoK and signed 16 MoUs worth $4.15 billion in various sectors. Lahore-Islamabad Motorway, the first road constructed with the most modern technique and equipment in Pakistan, has recently been completed under a contract, by a South Korean Company.

Peoples Party's government first went to world market in 1994, with a meagre amount of $150 million worth of trade (both ways) largely with the Western countries. But now $100 million has been oversubscribed notably by Korea, Singapore, and Bahrain. This minor shift in the policy of the present government shows a tilt in economic cooperation towards the developing countries of Asia.

Pakistan has established formal diplomatic relations with the Republic of Korea (RoK) since 1968, when RoK opened a consulate General in Pakistan, while Pakistan took twelve years time to open her Consulate General at Seoul, Capital of RoK, in 1980. But both the countries agreed to establish ambassadorial relations after only 3 years, in 1983, after which multidimensional ties began to grow with a satisfactory speed. There had a number of agreements been signed between the two countries including Trade Agreement (1968), Maritime Agreement (1984), Agreement on Economic, Technical and Scientific Cooperations and Trade Promotion (1985), Agreement on Visa Exemption (1986), Agreement on the Avoidance of Double Taxation (1987) Agreement on Investment Protection (1988) etc.

Trade between the two countries started with $165 million (both ways) in 1983, when formal relations began to grow between the two countries. It grew to $642 million in 1993 (both ways) but it dwindled to $602 million in '94 and rose again to $637 million in '95. The investments of RoK firms in Pakistan could not, however, go beyond $6.76 million by May 1996, which is inadequate and needs to be geared up. This was perhaps one of the motives that prompted Benazir to go to RoK.

Pakistan's trade with RoK in view of its potential, has not yet taken a hopeful turn. It is though small, in RoK's favour with Pakistan's exports to RoK to the tune of $239 million in 1994 and $279 million in 1995, while imports from RoK had a slight fall from $363 million in 1994 to $358 million in 1995 yet the overall trade between the two countries has a bent towards RoK.

It appears worthwhile to mention here that RoK is the 12th largest trading nation of the world and the seventh largest trading partner of Pakistan. …

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