REPORT of the visit of PIDE Consultants for
ECO-PIDE Study Project on “Trading Patterns in the ECO Region”
(Tehran, 13-14 June, 2010)
Increasing regional cooperation in WTO matters has become integral part of
the activities of Economic Cooperation Organization (ECO). Having laid down
regulatory mechanisms including ECO Trade Agreement (ECOTA) and other
agreements on Investment, Customs, Visa Facilitation, there is a now a growing need
to focus on removal of Tariff and Non-Tariff Barriers (NTBs) in the region. In this
direction, ECO is working on a strategy to support Member States in achievement of
their national policy objectives of accession to WTO process.
2.
The 18th Council of Ministers (COM) Meeting (Tehran, March 2009)
appreciated activities being designed by ECO on the “Trade Policy Reviews” model
of the WTO. It urged the Secretariat to co-ordinate “Trade Policy Review” sessions
on annual basis. Accordingly, ECO developed plans aimed at establishing closer
interaction for a more transparent trade policy regime and also assistance in
experience sharing, technical support, trainings, capacity building as well as support
at the WTO level. Under the activities of ECO-PIDE Study Project on the Trading
Patterns in the ECO Region, the Member States were requested to provide schedule of
their the Trade Review/Consultative Sessions. Islamic Republic of Iran and the
Republic of Turkey responding positively to the proposed arrangement announced
their schedules for coordinating Sessions during June 2010.
3.
The Trade Policy Review Session for Islamic Republic of Iran was hosted at
the ECO Secretariat on June 13, 2010 and follow up meetings were held on 14 June
2010 at Islamic Republic of Iran Customs Administration (IRICA) and Central Bank
of the Islamic Republic of Iran. The Review Session was participated by officials of
Ministry of Foreign Affairs, Iran Chamber of Commerce, Industries and Mines
(ICCIM), ECO Trade and Development Bank in Tehran, Ministry of Commerce and
the Ministry of Economic Affairs and Finance and Organization for Investment,
Economic & Technical Assistance of Iran OIETA (list of the participants is in Annex
V and the programme of the meeting is in Annex IV).
4.
The meeting was chaired by Mr. Fatih Unlu, Deputy Secretary General, ECO
who in his short briefing, underlined the importance of ECOTA for the expansion of
intra-regional trade. He highlighted various ECO initiatives in trade, investment,
finance, Transport, Agriculture and industry aimed at expansion of regional trade. The
Consultants representing Pakistan Institute of Development Economics (PIDE)
specifically shared information on the huge potential not being realized within ECO
region. They explained the purpose of the study is to enhance the existing trade
volume among the Member States by exchanging information on Policies,
impediments and also identifying national priorities, comparative and competitive
advantages in trade and investment. The PIDE Consultants were of the view that
considering the potential in the region, the volume of trade could be increased
manifolds by a combination of measures. The Director of ECO Trade and Investment
informed the participants about Non Tariff Barriers (NTBs) restricting the expansion
of trade. The representative of Organization for Investment, Economic and Technical
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Assistance of Iran (OIETA) informed participants on the activities of the organization
for increased Foreign Direct Investment (FDI) and incentives for foreign investors.
5.
A day earlier a Preparatory meeting between the Directorate and the visiting
PIDE team was held on 12 June 2010. During this meeting, the PIDE Consultants
discussed in detail proposed plan of activities with the Directorate officials. The filled
in Questionnaires received from Afghanistan, Azerbaijan and Turkey were examined
for inserting important details in the Study on the Trading Patterns in the ECO
Region. The PIDE Consultants were apprised of the coordination of activities in
connection with the Trade Policy Review Sessions. The response from the Ministries
of Foreign Affairs, Commerce, Finance, and Industry as well as Trade Promotion
Organizations (TPOs) conveyed to the ECO Secretariat was also considered in the
meeting.
6.
The follow up meetings were held at Islamic Republic of Iran Custom
Administration (IRICA) and Central Bank of the Islamic Republic of Iran on June 14,
2010. Director General of International Cooperation and Public Relations
Department, Mr. M.H. Baghenayat emphasized the importance of “Silk Road”
project. Bottlenecks to transit trade and required trade facilitation measures at the
borders were discussed in detail. The Director General underlined the importance of
Common Border Customs Stations and stressed establishing these on all ECO Transit
routes. He suggested that ECO may in consultation with Customs Administrations
expedite possible actions for cooperation through an MOU. He regarded it as of high
significance as trade facilitation will bring multiple benefits for the regional
economies.
7.
The second follow up meeting was held at Central Bank of the Islamic
Republic of Iran. Mr. Alireza Zandieh Director, Foreign Exchange Policies &
Regulations Department, briefed the visiting PIDE consultants on the foreign
exchange, monetary and fiscal measures and the network of Iranian banks in foreign
countries. At the national level Iran has 19 banks, three of them are public banks and
thirteen are private banks. Saderat Bank has branches in some other ECO countries as
Azerbaijan, Tajikistan Turkey, Turkmenistan and Uzbekistan. The meeting discussed
at length the regulatory mechanisms for Free Trade Zones in Iran and incentives for
foreign investors. Issues relating to Central Bank of Iran, possibilities of joint
ventures, Asian Clearing Union etc were also shared among the participants.
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REPORT
ECO-PIDE Study Project Visits on Trading Patterns in the ECO Region
(Ankara-Istanbul, 16-18 June, 2010)
The Economic Cooperation Organization (ECO) staff and Pakistan Institute of
Development Economics (PIDE) consultants conducted study visits to Turkey from
16-18 June 2010. The visits consisted of three main components in Ankara. The first
meeting was held in cooperation with Export Promotion Organization of Turkey
(IGEME), immediately after the Orientation Seminar on ECO Trade and Investment
Web Portal on 16 June 2010 at Dedeman Hotel Ankara.
2.
The meeting was inaugurated with the opening remarks by Mr. Fatih Unlu,
Deputy Secretary General of ECO and Ms. H. Asuman Soylu, Director of
Implementation and Coordination Directorate of IGEME. A Presentation was given
by the PIDE Consultants on the outline of the Study Project on Trading Patterns in the
Region (Presentation at Annex II). After the general meeting, Dr. Sevim Yalcin, Head
of Europe Department of IGEME had a presentation highlighting Turkey’s current
global trade and also trends in regional export-import activities/potential (Presentation
at Annex III). The participants exchanged useful information during their interactive
discussions.
3.
The second meeting was held in State Planning Organization (SPO) on 17
June 2010 under the chairmanship of Mr. Ferruh Tigli, Director General, Foreign
Economic Relations. Participants from key economic organizations and Ministries
presented documents on trade and investment (list of the participants- Annex V).
4.
The visiting ECO-PIDE team had another meeting held at the Undersecretariat
of Foreign Trade which was actively participated by relevant Heads of
Department/Senior Experts from Undersecretariat of Foreign Trade and
Undersecretariat of Treasury. The issue regarding ECOTA and improving investment
climate were discussed in detail. Views were exchanged on the need for a favourable
business environment, supported by liberal trade and investment policies, coordinated
promotional plans, Research and Development, support for value added exports were
important matters discussed by the participants. The host organizations gave valuable
guidelines for ECO-PIDE Study Project on Trading Patterns in the ECO Region. Mr.
Fatih Unlu, Deputy Secretary General ECO; Mrs. Bilge Kalkavan, Programme
Officer, ECO; Dr. Musleh Ud Din, Joint Director, Pakistan Institute of Development
Economics (PIDE); Dr. Zaffar Mueen Nasar, Chief of Research, PIDE; Dr. Ejaz
Ghani, Chief of Research, PIDE; senior officials and selected experts from different
Ministries and Trade Organizations of Turkey participated in the meeting (List of
Participants at Annex V). The PIDE Consultants had also follow up meetings in
Istanbul with Investment Support Promotion Agency (ISPAT), ECO Trade and
Investment Development Bank and ECO Chamber of Commerce and Industry (ECO
CCI) on 18 June 2010. The detailed report for the visits of PIDE consultants in Iran
and Turkey is attached at Annex I and the programme of the meeting is in Annex IV.
The following topics were discussed in the meetings.
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General Meetings:
Prospects for Regional Economic Cooperation in ECO Region.
Sectoral Trade Potential
Potential in Services Trade at the Regional Level.
Potential in Mutual Investment.
Economic and Technological cooperation at the regional level.
Bilateral Meetings:
Potential of bilateral trade in goods and services.
Bilateral Investment.
Trade policies and Trade facilitation measures, Transparency etc.
Financial Regulatory Issues etc.
Recommendations made during those meetings are as follows:
1. Removal of regional Non Tariff Barriers (NTBs)
2. Harmonization of customs tariff regimes and simplification of procedures
3. Improving transparency in policies for taking full advantage of the regional
trade potential.
4. Trade facilitation measures particularly at the Border Transit Points.
5. Visa Facilitation for businessmen to be offered by Member States on priority.
6. ECOTA is a very important tool to transform ECO region to a free trade area,
completion of the ratification process by the members needs to be vigorously
pursued.
7. Concrete action to be initiated for the promotion of intra regional trade.
8. For most of the Member States, trading opportunities are limited mainly with
textile and raw materials for that reason high value added specific sectors such
as, automotive, machinery, services and soft-ware should be highlighted.
9. Improvement of mutual investment and joint ventures by establishing required
mechanisms.
10. Supporting trade fairs/exhibitions, product promotion campaigns, seminars
and buyers-sellers meetings.
11. ECO countries need to adopt non discriminatory customs procedures which
act as major trade barriers.
12. Engaging experts/ professionals from regional countries in research/study
projects.
13. Publicizing and promoting ECO Trade and Investment Network Web Portal.
14. Improvement of investment regimes.
15. Collaboration for encouraging foreign direct investment inflow in the region.
16. Having more collaborative work with Turkey and ECO for the benefit of other
economies.
17. Exchange of information on financial support/ credit lines offered by
institutions / bank particularly for SME companies.
18. Increased market/product research for exportable items.
19. Improving transportation system in ECO region.
20. Avoiding security problems in ECO region.
21. Improving transit trade infrastructure of smaller economies in ECO region.
22. Establishing Country Desks in relevant Ministries for multiplying trade
relations.
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23. Opening up existing policies for development of private sector.
24. Supporting, particularly, trade in goods will support trade in services
25. Establishing Joint Economic Commissions for frequent exchange of views on
bilateral and multilateral trade.
26. Awareness/ image creation for products having greater potential for trade in
the region.
27. Establishing direct links between companies through country meetings, trade
missions and buyer-seller meetings for increased commercial presence.
28. Conducting more market researches by TPOs for identifying potential
products that have competitive advantage.
29. Political stability is essential for economic development and the long-term
success of economic and trade policies.
30. Improving a system of exchanging information and its dissemination in order
to increase the volume of trade. Lack of information on trade is considered as
one of the major impediments for the expansion of regional trade. Trade can
be expanded if businesses have enough access to information on trade policies,
market opportunities as well as customs, banking, insurance and certification
procedures. Trade and investment among the countries can grow significantly
if transparency in regulations is maintained and information dissemination
process is streamlined.
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