GCC–Pakistan FTA dominates Doha forum

December 06, 2025 (MLN): The newly concluded Free Trade Agreement between Pakistan and the Gulf Cooperation Council (GCC) became the central development at the 23rd Doha Forum on Saturday.

Qatar termed the pact a major shift in regional trade architecture and signalling deeper cooperation with Pakistan in energy, technology, and artificial intelligence, said a press release issued today. 

The development took prominence as Pakistan’s Finance Minister Senator Muhammad Aurangzeb and Qatar’s Finance Minister Ali Bin Ahmed Al Kuwari appeared together on a high-level panel on global trade tensions, where both ministers linked the FTA to a new phase of economic integration between Pakistan and Gulf economies.

Qatar described Pakistan as a “brother country” and said the agreement would significantly expand cross-border trade after what is considered the GCC’s first substantial FTA in several years.

The panel, titled “Global Trade Tensions: Economic Impact and Policy Responses in MENA”, was jointly convened by the Doha Forum, the Qatar Ministry of Finance, and the International Monetary Fund.

It examined how rising protectionism, supply chain shifts, and geopolitical rivalry are reshaping economic strategies across the Middle East and North Africa.

Senior policymakers and global economic leaders joined the discussion, focusing on diversification, resilience, and the need for forward-looking trade policy.

In his remarks, Aurangzeb outlined Pakistan’s macroeconomic stabilisation achieved after completing the Extended Fund Facility programme.

He said fiscal buffers had been rebuilt, with both the primary fiscal balance and current account returning to surplus.

Strong remittances from MENA and GCC workers, estimated at USD 18–20 billion annually, remained a key pillar of external stability.

He stressed the continuity of structural reforms in taxation, energy, state-owned enterprises, and private-sector development to sustain stability and transition toward growth.

The minister added that Pakistan had managed recent U.S. tariff changes through constructive engagement and secured a comparatively favourable 19% tariff on major textile exports.

Commenting on shifting global trade conditions, Aurangzeb said Pakistan was accelerating product and market diversification.

IT services exports are expected to reach nearly USD 4 billion this year, while trade outreach has expanded to Gulf markets and Central Asian partners including Azerbaijan, Turkmenistan, and Kazakhstan.

Pakistan, he said, had not yet experienced the sharp downside risks seen in other emerging markets but remained alert to global uncertainties.

Aurangzeb also identified climate change and demographic pressures as Pakistan’s most critical long-term risks.

Severe flooding alone erased at least 0.5 percentage points from GDP growth this year, highlighting the urgency of climate-resilient investment.

Qatar’s finance minister said bilateral relations were deeply rooted in LNG supply arrangements, textile and agricultural imports, and long-standing economic cooperation.

He pointed to Pakistan’s potential in emerging digital sectors, particularly artificial intelligence and downstream applications, and said Qatar aims to partner with Pakistan on AI capability development, digital infrastructure, and skills advancement. Pakistan’s expanding talent base, he said, aligns strongly with Qatar’s next-generation economic priorities.

IMF Deputy Managing Director Bo Li termed Pakistan “a very good example” of a country moving steadily on the reform and resilience path. In addition to the USD 7 billion stabilisation programme, he confirmed the IMF is providing USD 1.3 billion under the Resilience and Sustainability Facility (RSF) to strengthen climate-related fiscal and financial frameworks.

The facility will support green budgeting, climate-risk integration in financial sector regulation, improved data disclosure, and climate-resilient infrastructure planning.

Addressing Pakistan’s geopolitical positioning, Aurangzeb said partnerships with China and the United States were complementary.

CPEC’s Phase 2.0 has shifted from government-to-government infrastructure to business-to-business investment, while U.S. engagement is growing in minerals, mining, and digital technologies including AI, blockchain, and Web 3.0.

He also discussed opportunities for Pakistan’s large youth cohort: upskilling freelancers in blockchain and AI could raise earnings from USD 10–12 per hour in basic coding to USD 60–250 per hour in specialized domains.

Pakistan, he said, had established a crypto council and was developing a regulatory framework for virtual assets aimed at curbing capital flight and strengthening anti–money laundering controls.

After the panel, Aurangzeb and Al Kuwari held a bilateral meeting to advance cooperation areas highlighted earlier in the day.

Both sides agreed to leverage the GCC–Pakistan FTA to expand regional trade, deepen long-term LNG arrangements, and create mechanisms for regulatory, technological, and investment collaboration.

They also agreed to develop structured pathways for cooperation in AI, digital infrastructure, climate resilience, trade diversification, and public-private investment facilitation.

Both ministers expressed confidence that Pakistan–Qatar ties are entering a strategic expansion phase driven by the new FTA and shared economic interests.

Copyright Mettis Link News