ISLAMABAD: Prime Minister Shehbaz Sharif said on Tuesday the South American market could prove beneficial to the Pakistani economy after the federal cabinet approved a trade framework agreement with a bloc comprising Argentina, Brazil, Paraguay and Uruguay, based on the commerce ministry’s recommendation.
Pakistan signed the trade framework agreement with Mercosur, also known as the Southern Common Market, in 2006 with the aim of initiating negotiations to establish a Preferential Trade Agreement (PTA). However, the two sides could not make significant progress in that direction in subsequent years or significantly enhance bilateral economic cooperation.
In early 2019, Pakistan explored the possibility of moving toward a Free Trade Agreement (FTA) with the bloc, saying it could help bridge the trade deficit with the Latin American states, but the initiative once again did not progress far.
“The federal cabinet, on the recommendation of the commerce ministry, has granted ex-post facto approval for the trade framework agreement between Mercosur (a trade bloc in South America comprising countries like Brazil, Argentina, Uruguay and Paraguay, commonly referred to as the Southern Common Market) and the Islamic Republic of Pakistan,” said an official statement issued after the cabinet meeting.
“In this regard, the prime minister said the South American market could potentially be a good market for Pakistani products,” it added. “However, the Pakistani economy has not yet been able to reap the benefits of this market.”
Pakistan plans to increase its textile and other exports to the Latin American market.
Officials have previously said that an FTA would help strengthen the country’s business and trade relations in the region and provide a level playing field against its competitors.
The federal cabinet’s approval of the trade framework agreement comes at a time when Pakistan is seeking foreign investment and exploring international markets for exports to bolster its economy.
Pakistan PM highlights benefits of South American market after cabinet approves trade agreement
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Pakistan PM highlights benefits of South American market after cabinet approves trade agreement
- Pakistan signed the trade framework agreement with a Latin American bloc in 2006 for preferential trade
- It plans to enhance textile exports to the region and secure a level playing field against its competitors
Pakistani stocks breach 176,000 points barrier as investors expect further rate cuts
- Pakistani financial analyst attributes surge to falling inflation, investors expecting further policy rate cuts
- Pakistan’s finance ministry said Thursday that inflation had slowed to 5.6 percent year-on-year in December
KARACHI: Pakistani stocks continued their bullish run on Thursday, breaching the 176,000 points barrier for the first time after trading ended, with analysts attributing the surge to investors expecting further cuts in the policy rate.
The KSE-100 benchmark gained 2,301.17 points at close of business on Thursday, marking an increase of 1.32 percent to settle at 176,355.49 points.
Pakistan’s central bank cut its key policy rate by 50 basis points to 10.5 percent last month, breaking a four-meeting hold in a move that surprised markets. Pakistan’s consumer price inflation slowed to 5.6 percent year-on-year in December, while prices fell on a monthly basis as per data from the finance ministry.
“Upbeat data for consumer price index (CPI) inflation at 5.6pc in December 2025 [with] investors expecting a further State Bank of Pakistan rate cuts on falling inflation data,” Ahsan Mehanti, CEO of Arif Habib Commodities Ltd., told Arab News.
The stock market witnessed a trading volume of 1,402.650 million shares, with a traded value of Rs48.424 billion ($173 million), compared with 957.239 million shares valued at Rs44.231 billion ($158 million) during the previous session.
Topline Securities, a leading brokerage firm in Pakistan, credited the surge to strong buying at the first session.
“This positivity can be accredited to buying by local institutions on the start of the new calendar year,” it said.
Pakistan’s Finance Adviser Khurram Schehzad highlighted that the bullish trend at the stock market reflected “strong investor confidence.”
“With lower inflation, affordable fuel, stronger reserves, rising digitization and a buoyant capital market, Pakistan’s economic outlook is clearly improving--supporting greater confidence, better investment sentiment and more positive momentum for 2026,” he said on social media platform X.
