Syed Nadeem Ali Kazmi, the president of the German Pakistan Chamber of Commerce and Industry (GPCCI), has requested the government to lift the prohibition on the import of cars from Germany in letters to the ministers of finance and commerce, Miftah Ismail and Syed Naveed Qamar.
As a result of the ongoing crisis caused by the import ban, Kazmi wrote to the Ministers, “The German Pakistan Chamber of Commerce & Industry urges the immediate removal of the import ban implemented on the automotive sector, since this ongoing crisis brought about by the import ban, such steps are forcing our German member automotive organizations to exit the Pakistan market with tar reaching adverse repercussions leading to over 30,000 cars (Audi, BMW, Mercedes-Benz) being unserviceable and a complete end to German innovative technology transfer in terms of knowledge and skill sets necessary for the maintenance of these vehicles.”
“You are requested to kindly initiate steps to lift the ban immediately and since; we realize that the administrative steps will take a few days to implement your directives. we must insist on a firm date on which the ban on German automotive imports will be lifted so that we may advise our member accordingly” The import prohibition, according to Kazmi, has caused an “existential crisis” for the three German automakers.
It is important to remember that Pakistan’s application for the GSP+ Scheme must be submitted again because the existing one expires in 2023, as Kazmi notes.
An article detailing how Pakistan will be subject to 12 percent tariffs in the absence of GSP+ has previously been published by the Friedrich Naumann Foundation for Freedom Pakistan and the Policy Research Institute of Market Economy (PRIME).
Kazmi questioned the effectiveness of the import restriction, pointing out that imports of German cars were just €100 million and were thus unlikely to make a significant hole in Pakistan’s balance of payments imbalance.
Notably, Pakistan imported just $600 million worth of fully assembled (CBU) automobiles in FY 2021/22, or 0.75 percent of the country’s total imports at that time.
To read our blog on “Software glitch in 59,000 Tesla cars, German road traffic agency indicates,” click here.