Posting multiple records of growth, Pakistan’s earnings from Italy in exports and remittances crossed $2 billion in Financial Year 2021-2022 (FY22).
Italy became the seventh billion-dollar export country for Pakistan during the year with a record growth of export volume to $1,146 million, while the remittances from Italy reached $857 million during the year. Furthermore, substantial growth in Foreign Direct Investment (FDI) from Italy was also witnessed during the record-breaking year. Record export volume to Italy was also recorded in June 2022, crossing the mark of $144 million.
This phenomenal growth in exports and remittances has come at a time when the European economies are slowing down and facing multiple challenges due to the Ukraine war.
The exports of $1.15 billion to Italy in FY22 are 46 percent higher than the previous year, while the remittances are 41 percent higher for the same period than the last year.
While talking to the media, Pakistan’s Ambassador to Italy Jauhar Saleem lauded the Pakistani exporters for their initiative and hard work and the Pakistani diaspora in Italy for standing by the country in the most challenging economic environment. He also shared that Pakistan had posted a record trade surplus of $573 million during FY22, 91 percent higher than the previous year.
According to the envoy, the value-added sectors were the main drivers of the exceptional export growth, with exports of plastic products increasing by 208 percent, sports goods by 80 percent, leather by 42 percent, home textiles by 36 percent, and garments by 35 percent.
Despite the lower demand in the footwear market due to COVID-19, Pakistan’s exports of footwear to Italy increased by 19 percent in the year, and Italy has become the third largest export destination for Pakistani footwear. Italy is the fifth largest destination for Pakistani home textiles and ranks sixth in garments exports.
The ambassador also informed that with the revival of market activities after the removal of pandemic-related restrictions in Italy, the Pakistan Embassy in Italy was further pacing up its activities to connect Pakistani businesses with Italian firms to sustain the exports and FDI growth. During the concluded financial year, Pakistan received Italian investment in the sectors of food processing, chemicals, construction, leather, footwear, energy-related equipment, and IT.
The ambassador also shared that some of the recent joint ventures between leading Pakistani and Italian footwear firms were enabling technology transfer, international marketing skills, and supply chain management to Pakistani firms. Moreover, Italy was also providing technical support in the agriculture sector especially related to olive and olive products. Similarly, Italy is supporting the efforts to reduce the risks of Glacial Lake Outburst Floods (GLOF) and hydrogeological hazards in mountainous areas by establishing an evidence-based assessment and monitoring system for glaciers in Gilgit Baltistan.
Saleem informed the media that Italy has announced to allow 69,700 seasonal workers from selected countries in 2022 to come to Italy for work. Pakistan has already been included in the Italian Seasonal Work Visa Programme for 2022, which would offer many opportunities to our workers in the agriculture and services sector to work in Italy. He added that the Italian government has recently reduced the timelines for work visa processing which has been a long-standing demand from Pakistani workers.
With the record increase in remittances during the last three years, Italy has become the largest contributor to this financial sector from the European Union (EU). In 2021-22, around 25 percent of Pakistan’s total remittances from the EU came only from Italy.
The envoy stated that the dynamic diaspora in Italy had helped post the highest growth in workers’ remittances among all destinations in the world, making Italy Pakistan’s eighth largest destination for remittances globally and number one within the EU. Keeping in view the Italian labor market conditions and employment opportunities for Pakistani workers, the growth momentum would be maintained by connecting more Pakistani workers with the Italian job market.
