Brief for Global Manufacturing and Industrialization Summit

1. An overall view of our Industry statistics and our trade and industry collaboration
with Abu Dhabi and the South Asia Region.

According to Economic Survey of Pakistan 2015-2016, Manufacturing is the

second largest sector of the Pakistani economy accounting for 13.6 percent of
Gross Domestic Product (GDP). This sector mainly comprises textile industry,
engineering goods and industry, agro based industry, chemical industry and
small & medium enterprises. This sector provides employment opportunities of
15.3 percent to the total labor force.

Large Scale Manufacturing ( LSM) at 10.9 percent of GDP dominates the overall
sector, accounting for 80 percent of the sectoral share followed by Small Scale
Manufacturing, which accounts for 1.8 percent of total GDP. The third component
of the sector is slaughtering and accounts for 0.9 percent of overall GDP.

Top three industries that have shown the highest growth rate are Automobiles
with the growth rate of 23.4%, followed by Fertilizers 15.92 percent, and
Chemicals 10.01%. Improved supply of electricity and gas coupled with
expansion in credit to private sector has facilitated industry to flourish and grow.

Pakistan’s total trade with GCC countries stands at $20.6billion at present, which
includes $17.5billion as our imports and $3.1billion11 as exports. Generally
Pakistan exports textile products to the GCC countries, whereas there is a hefty
import of mineral fuel oils, distillation products and fertilizers. The trade
primarily remains focused on the larger trading partners such as UAE, Saudi
Arabia and Kuwait, while the others have relatively smaller share. UAE and Saudi
Arabia are the major export partners of Pakistan. UAE is also major import
partner of Pakistan. Pakistan has been trying to have Pakistan and Gulf free tree
trade agreement. It is estimated that the two way trade would receive a
“quantum jump‟ if negotiations over a free trade agreement between the two
sides are completed.

Pakistan has signed free trade and preferential trade agreements with Sri Lanka,
China, Malaysia, Indonesia, and Mauritius. Pakistan has also been granted GSP+
status from EU. In south Asia, Pakistan is an important member of South Asian
Free Trade Agreement (SAFTA). Pakistan has also granted transit facility to
Afghanistan through Afghan Transit Trade Agreement ATTA. ATTA permits the
use of more ports & more carriers - including Afghan trucks - and increases the
number of border crossing points. It also provides for Afghan exports to India
using the land border between Pakistan and India. The pact also envisages the
use of Afghan territory for trade between Pakistan and Central Asian countries.

During last few years, the global economy continued to grow at a slow pace,
accompanied by sluggish aggregate demand, declining commodity prices and
increasing financial market instability in major economies. Growth of world
trade decelerated, due to declining import demand in Europe, and weak
aggregate demand in the United States and Japan. As a result, developing
countries and economies in transition have seen demand for their exports
weaken. Pakistan’s major trading partners like US, China, EU have also witnessed
a sluggish economic growth during past few years. Major chunk of exports go to
US, China and EU. Therefore, slow down in China and European economies and
weak demand have significantly impacted Pakistan’s export growth

During recent years, Pakistan exports recorded a sluggish growth. The exports
target for FY2016 was set at US$ 25.5 billion. Exports during July Mar FY2016
remained at US$ 15.6 billion as compared to US$ 17.9 billion in July-Mar FY2015,
decline of 12.9 percent. The main reasons for lower performance of exports are
generally weak external demand, slowdown in economic growth of China, lost
textile share to new competitors in international markets, and unfavorable terms
of trade for exports with little value added.
Questions for GMIS

1. What has been the impact of lower oil prices on manufacturing in the GCC?
2. How can governments turn the transition to “smart industry” into an opportunity for
long-term sustained economic growth?
3. What specific role can manufacturing sector play in making the GCC more
competitive? How can policymakers help to accelerate this process?
4. What can governments do to prepare tomorrow’s workforce for a higher skilled,
technological future? How can we prepare young people for jobs that don’t yet
exist?
5. Technology is disruptive, and strategies will be needed to manage negative
consequences. How can the manufacturing industry take advantage to capture the
full potential for productivity and growth?
6. How do you effectively manage risk in global supply chains?
Focus on South Asia
Narendra Modi’s Make in India programme has put the region’s manufacturing sector on
the map. With low cost bases around the Indian sub-continent leading to an increase in
production, manufacturing has had a transformative effect. The region is also investing
substantially into infrastructure to support industrial and economic growth. However,
despite the significant efforts by policymakers to create attractive conditions for FDI,
manufacturing in the region has been beset by claims of social injustices.

1. How can policymakers collaborate with the industry to ensure that international
standards are met, while developing a sustainable, diversified industrial strategy?
2. How can infrastructure investment support industrial growth?
 3. And how can manufacturing ensure international best practice in social and
environmental practices?

The Global Manufacturing and Industrialisation Summit (GMIS) 2017 will gather
governments, theprivate sector and civil society to explore the future of manufacturing,
and share information on globaltrends and insights that will shape the sector.
1. How can manufacturing help to address social and economic challenges?
2. How can developed and emerging economies with strong or
growingmanufacturing sectors achieve inclusive and sustainable growth?
GMIS 2017 will identify practical stepsfor progress, setting out a roadmap for
development.

The conference will focus on the role of manufacturing in reconstructing the global
economy and restoring global prosperity. Leaders from the public and private sectors,
along with civil societyrepresentatives, will gather together to discuss global challenges
facing the manufacturing sector.
The discussions will focus around six themes: technology and innovation; global value
chains; skills,employment and education; sustainability and environment; infrastructure;
standards and stakeholderalignment.
The participants will form working groups to identify concrete action plans and
recommendations thatoutline potential solutions to global issues, as well as showcase
best practices and case studies fromacross the world. To highlight an example of global
issues, the inaugural conference will focus on theissue of economic migration with the
aim of establishing a manufacturing platform that will bringtogether countries facing
emigration or immigration challenges, with regional countries that seek tosupport
economic reconstruction. These countries will work together with manufacturers and the
widerUnited Nations network on restoring global prosperity.