Exporters must exercise caution due to Pakistan's lack of foreign currency.

DNHN - The Vietnam Trade Office in Pakistan has issued a warning to businesses that export to Pakistan to be mindful of payment issues. Pakistan is experiencing a growing shortage of foreign currency.

Pakistan is experiencing a growing shortage of foreign currency, which makes it difficult for Vietnamese companies to export to this market.

In response to this situation, the Vietnam Trade Office in Pakistan has issued a warning to businesses exporting goods to Pakistan to pay close attention to payment issues, as the State Bank of Pakistan has made policy changes in this area.

In particular, on January 24, the State Bank of Pakistan (SBP) announced the repeal of the regulation requiring importers to apply for permission to be granted foreign currency before importation.

However, SBP issued a new regulation that was valid until March 31, 2018. This allows Pakistani commercial banks to process and release documents for businesses importing goods, so long as the shipment has arrived at a Pakistani port or was delivered on or before January 18, and the importing business has agreed with its partner on payment terms of 180 days late or payment from a third country.

This is considered an urgent solution by the SBP to address Pakistan's growing foreign currency shortage.

Currently, a lack of foreign currency is putting increasing pressure on Pakistani importers, making it impossible for them to purchase sufficient foreign currency to pay exporting companies.

This causes imported shipments to back up at the port of Karachi beyond the allotted time, resulting in costs and fines from the port, shipping lines, and even confiscation and auction by Pakistan Customs.

According to the Vietnam Trade Office in Pakistan, the country's Customs has issued a regulation mandating that all imported shipments held up in the port for more than 30 days will be confiscated and sold at auction.

Therefore, the Trade Office recommends that all businesses exporting goods to Pakistan, particularly for shipments with late payment, notify the Vietnam Trade Office in Pakistan to receive assistance with handling.

In addition, extreme caution must be exercised to avoid incurring fees and fines from ports and shipping lines and having goods confiscated and sold at auction by Pakistan Customs.

To avoid problems when exporting to Pakistan, the Vietnam Trade Office in Pakistan offers the following advice to Vietnamese exporters: (i) Ask Pakistani partners for payment from a third country; (ii) Reporting to competent state agencies and request the bank to support a late payment method for 180 days; and (iii) preparing a variety of consumption directives for the event that Pakistan defaults on its national debt and has no foreign currency with which to pay its creditors.

P.V (t/h)