National Tariff Commission Pakistan “Current Situation and Prospect of Pakistan’s Application of Trade Remedy Instruments” Beijing, June 25-26, 2007

o Current Situation o Current Situation in relation to China o Prospects Outline of Presentation

o Pakistan founding Member of GATT in 1947 o Pakistan signatory to the Final Act (Uruguay Round Agreements on Trade in Goods, Trade in Services, TRIPS etc, 1994) o WTO Trade Defence Agreements implemented 2000 onwards Pakistan and WTO

The Commission is responsible for administration of, inter alia, the following statutes: o Anti-Dumping Duties Ordinance, 2000 o Countervailing Duties Ordinance, 2001 o Safeguards Measures Ordinance, 2002 Functions of the Commission

Pakistan’s Trade Defense Laws strive for strict conformity with respective WTO Agreements, i.e., o Agreement on Implementation of Article VI o Agreement on Subsidies and Countervailing Measures o Agreement on Safeguards Compliance with WTO Agreements

6 o The Commission initiated twenty-four AD investigations and one safeguard investigation since 2002 o Imposed measures in nineteen cases o Five AD investigations and the safeguards investigation were terminated without any measure Implementation of Trade Defence Agreements: Actions by Pakistan

Implementation of Trade Defense Laws Actions Taken by Pakistan ProductExporters from Polyester Staple Fibre Thailand Korea, Indonesia TilesChina TinplateUK, USA, Italy, Germany and France Formic AcidFinland and Germany Pthalic AnhydrideIndia Polyester Filament Yarn Indonesia, Korea, Malaysia, and Thailand 7

Implementation of Trade Defense Laws Actions Taken by Pakistan, continued ProductExporters from UFMCChina PVC Resin Iran Korea Acrylic TowUzbekistan Glacial Acetic AcidTaiwan Sorbitol 70% Solution France Indonesia TinplateSouth Africa

CategoryAD InitiationsAD Measures Steel61 Chemical99 Others99 Total2419 Pakistan’s AD activity follows the worldwide trend of steel and chemical products being targeted relatively frequently Pakistan Anti-Dumping Activity

Category AD Initiations AD Measures Percentage Steel Chemical Others1, Total2,9381, Source: WTO Website (Period - January 2005 to June 2006) Worldwide Anti-Dumping Activity

o Comments on Application and Initiation o Right to present information, including orally o Comments on Preliminary Determination o Hearing upon request o Comments on Statement of Essential Facts o Meetings with interested parties with adverse interests o Access to public file Investigation: Opportunities provided to Interested Parties

o Reply to the Exporter’s Questionnaire o Request for Individual Dumping Margin o Price undertaking o Disclosure Meetings upon request Additional Opportunities for Exporters

Determinations may be made on the basis of facts available only when an interested party : o refuses access to or does not provide information within a reasonable period, or o significantly impedes the investigation Provisions of Annex II of AD Agreement are observed while making a determination on the basis of “Facts Available”. Determination on basis of “Facts Available”

o The Commission conducts “On the Spot investigations” for: o Domestic Industry (before initiation of investigation) o Exporters/Foreign Producers o Purpose of visit is to verify information provided in application/questionnaire response o Sufficient advance notice is given o Report on verification takes into consideration the comments received thereon by the subject party, and o Non-confidential version of report placed on public file On the Spot Investigation

Throughout the investigation, the Commission keeps all interested parties informed of the developments in an investigation through: o Notices and Reports o Public File established and maintained in each investigation Transparency

Notices published in national newspapers, official Gazette and also sent directly to all known interested parties. These Notices include: o Notice of Initiation o Notice of Preliminary Determination o Notice of acceptance of Price Undertakings o Notice of Final Determination o Notice of Termination of Investigation Transparency

o The Public File contains all documents (non- confidential) including application, notices, reports, comments and correspondence with interested parties and other related documents. o The public file is open for inspection to all interested parties. o All notices and reports of determinations are voluntarily posted on the Commission’s website: Transparency

o Appellate Tribunal (Pakistan) o Any interested party can file an appeal against a final determination made by the Commission o Dispute Settlement Body (Geneva) o The government of exporting country may approach the DSB to challenge the inconsistencies of a measure with the WTO Agreements Appeal against Determination

Outline of Presentation o Current Overall Situation o Current Situation in relation to China o Prospects

o The Commission has so far received five anti-dumping complaints relating to PRC exporters o Three complaints did not warrant formal applications o Anti-dumping measures were imposed in two cases after following due process Applications received in relation to PRC exporters

Anti-Dumping Cases Relating to PRC Exporters ProductYear Procedure Followed Result Urea Formaldehyde Moulding Compound 2005 Due process under the domestic legislation followed Anti-Dumping measure imposed Ceramic Tiles2006 Due process under the domestic legislation followed Anti-Dumping measure imposed

The Commission defended the following in domestic Courts in anti-dumping investigation relating to dumped imports of Tiles. o Sixty-Six writ petitions in the High Court o Two appeals in the Supreme Court o A complaint filed before the Federal Tax Ombudsman Due process followed by the Commission upheld. 22 Trade Defense Laws Litigation in Domestic Courts

Outline of Presentation o Current Overall Situation o Current Situation in relation to China o Prospects

o Existing and emerging tariff regime o Growth in imports o Growth in domestic and export demand o The Antidumping Agreement Prospects

Applied Tariff Rates Pakistan’s existing import tariff regime

NAMA negotiations and the shape of the emerging import tariff regime NAMA negotiations are seeking reductions in tariffs and increase in bindings These negotiations are finding a focus around the “Swiss Formula”, viz: Issues under discussion include the formula coefficient and the speed of adjustment

Application of Swiss Formula to Pakistan’s Bound Rates Bound Ratesa = 15a = 20a = 25a =

Swiss Formula: Implications for Pakistan’s Bound Rates Pakistan average bound tariff 54.6% Pakistan average bound tariff 14.60%

Any reduction in import tariffs would likely increase imports Increase in imports would cause industry to seek remedies

YearImportsAnnual change % , , , , (Jul-Dec)14, (Million of USD) Source: IMF - Direction of Trade Statistics Pakistan’s Imports

Major Imports of Pakistan March-July Share in per cent Chemicals, incl Fertilizers Machinery, incl Elect, Transpt Food Paper,board and stationery Art Silk Yarn Iron, steel and manufactures thereof Non-ferrous metals Petroleum & petroleum products Other , Source: Economic Survey of Pakistan

(%age of total) United States1,2911, EU2,5894, China5762, Japan 1,2391, Indonesia Malaysia Korea Saudi Arabia7072, U.A.E6152, Kuwait9001, Others3,1236, Total12,13125, Millions of USD Source: Direction of Trade Statistics, IMF Pakistan: Direction of Imports

o Pakistan current year GDP growth projected at 7 per cent o Major export markets, the IMF’s Advanced Economies, are expected to grow at 2.5 and 2.7 per cent in 2007 and 2008 o IMF projects the important export market of Developing Asia to grow at 8.8 and 8.4 per cent in 2007 and 2008 Growth in domestic and export demand

Exports from Pakistan percent share United States1,5513, EU2,7784, China Japan Indonesia Malaysia Korea Saudi Arabia U.A.E4341, Kuwait Hong Kong Others2,2214, Total9,32116, Millions of USD Source: Direction of Trade Statistics, IMF

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Implementation of Trade Defense Laws Anti-Dumping Actions Taken by Pakistan ProductExporters from Initiation Date Preliminary Determination Final Determination Anti-Dumping Duties Polyester Staple Fibre Thailand Korea, Indonesia % to 8.33% % to 10.26% TilesChina % to 21.02% % to 23.65% Tinplate UK, USA, Italy, Germany and France Terminated Formic Acid Finland and Germany % and 6.16% % and 6.25 % Pthalic AnhydrideIndia % % Polyester Filament Yarn Indonesia, Korea, Malaysia, and Thailand % to 36.56% % to 29.68%

Implementation of Trade Defense Laws Anti-Dumping Actions Taken by Pakistan ProductExporters from Initiation Date Preliminary Determination Final Determination UFMCChina % to 14.89% % to 11.58% PVC Resin Iran Korea % 40.18% % 40.18% Acrylic TowUzbekistan % % Glacial Acetic AcidTaiwan % % Sorbitol 70% Solution France Indonesia % & 91.12% % & 22.26% TinplateSouth Africa % %

Imports From PRC YearImports (mlln $)Annual change (%) (21.70) (Jul-Mar) Source: IMF Direction of Trade Statistics

Composition of Imports from PRC (July-December 2006) Commodities Value (000 US$) Percentage Machinery 654, Iron and steel 90, Chemicals 162, Coal, coke and briquettes 55, Yarn & thread of synthetic fibers 90, Construction materials 40, Manufactures of non-ferrous metals 33, Tyres and tubes of rubber 39, Others 373, Total 1,539,