Pakistan says it wins US tariff deal; Trump cites oil reserves pact
"This deal marks the beginning of a new era of economic collaboration especially in energy, mines and minerals, IT, cryptocurrency and other sectors," the Pakistan finance ministry said in a statement following a final round of talks in Washington.
Islamabad described the deal as a marker of a broader partnership with Washington, and Finance Minister Muhammad Aurangzeb, who led the final round of talks, said there was a larger economic and strategic agreement.
"From our perspective, it was always going beyond the immediate trade imperative, and its whole purpose was, and is, that trade and investment have to go hand in hand," he said, in video-taped remarks.
Pakistan had faced a potential tariff of 29%, which was later suspended - as with other nations - to allow trade talks up to an August 1 deadline. Islamabad was aiming at a tariff less than regional trade rivals such as Vietnam, which had a 20% tariff imposed by Trump, and India, which is threatened with a 25% tariff.
Islamabad's trade surplus with Washington was around $3 billion in 2024, mainly due to textile exports. The United States is Pakistan's biggest market for textiles.
The finance ministry said the agreement would lead to a "reduction of reciprocal tariffs, especially on Pakistani exports to the United States", but stopped short of revealing the figure.
U.S. President Donald Trump meanwhile trumpeted a pact to help develop Pakistan's oil reserves. "We have just concluded a Deal with the Country of Pakistan, whereby Pakistan and the United States will work together on developing their massive Oil Reserves," Trump wrote on social media.
"We are in the process of choosing the Oil Company that will lead this Partnership."
OFFSHORE EXPLORATION
However Pakistan has seen a series of unsuccessful offshore exploration attempts. Its proven recoverable conventional crude oil reserves of between 234 million and 353 million barrels by different estimates place it around 50th in the world.
Shale oil extraction has not been developed in Pakistan, though a 2015 study by the U.S. Energy Information Administration estimated a technically recoverable shale oil resource of 9.1 billion barrels for Pakistan.
Oil is Pakistan's biggest import item, $11.3 billion in the year ended June 30, 2025, accounting for nearly a fifth of its total import bill, central bank data showed.
The agreement does have potentially wider diplomatic aspects. Washington has been concerned to wean Pakistan, a nuclear-armed country of 240 million people, away from its increasing dependence on China.
Before the Trump administration, Islamabad's relationship with Washington had cooled in recent years, as the U.S. had drawn closer to Pakistan's traditional adversary India.
There was also resentment from Washington over Afghanistan, especially under the administration of President Joe Biden, which oversaw a chaotic withdrawal from Afghanistan and the handing over of the country to the Taliban insurgency that Washington accused Islamabad of backing.
Pakistan denies the charge.
Under Trump, Washington has sought to renegotiate trade deals with many countries which he threatened with tariffs for trade relations he calls unfair, a characterization many economists dispute.
In South Asia, Trump has repeatedly taken credit for a ceasefire agreed between India and Pakistan on May 10, after four days of conflict, saying he used the threat of restricting trade to get the two sides to halt hostilities.
Islamabad embraced that version of events, praising him for intervening and then nominating him for the Nobel Peace Prize. India disputes Trump's claims that the ceasefire resulted from his involvement and trade threats. (Reporting by Kanishka Singh in Washington, Asif Shahzad in Islamabad and Ariba Shahid in Karachi; Writing by Saeed Shah; Editing by Clarence Fernandez and David Holmes)
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Khaleej Times
9 hours ago
- Khaleej Times
Never mind Wall Street records, investors rethink US market supremacy
A rebound on Wall Street and in the dollar has not allayed investor concerns about the ability of U.S. assets to outperform overseas markets, with a fresh tariff salvo once again denting market optimism after a string of trade deals struck by the Trump administration perked up sentiment for equities to set record highs. The sliding dollar, down about 8% this year against a basket of major currencies, and the ballooning fiscal deficit are shaking the conviction that U.S. financial markets will deliver world-beating returns. For more than a decade, the concept of "American exceptionalism" - the conviction that the United States' democratic system plus its huge and liquid capital markets offer unique rewards - has been little challenged by investors. But ongoing uncertainty surrounding tariffs is rattling confidence. While the deals struck by Donald Trump with the European Union, Japan and South Korea have delivered some relief, the U.S. president late on Thursday slapped dozens of trading partners with steep tariffs. A market shakeout earlier this year caused by Trump's first tariff announcements triggered a re-evaluation. The U.S. market's standing appears "a little bit bruised," said Lori Heinel, global chief investment officer at State Street Investment Management. "The overhang of the (government) debt makes it less attractive to have dollar-based assets," she added. In a survey conducted in late May and June, market research consultancy CoreData found that many institutional investors and consultants, collectively overseeing $4.9 trillion in assets, are scaling back exposure to the U.S. Among respondents, 47% are cutting their strategic, long-term allocations to U.S. markets. While investors have become more upbeat on the outlook for Europe, as well as for China and other emerging markets, bullishness toward U.S. markets now lags those regions. That, said Michael Morley, head of CoreData US, marks 'a massive reversal' from attitudes two years ago. The latest wave of tariffs on exports from dozens of trading partners, including Canada, Brazil, India and Taiwan, sent global markets tumbling on Friday. The announced duties were "somewhat worse than expected," analysts at Societe Generale said in a note. "Markets responded more negatively to the August 1 announcement than to other news in the past two months, but the reaction was far less severe than on April 2," they said. TARIFF IMPACT OVERDUE? Investors began reconsidering their allocations following Trump's "Liberation Day" tariff announcement on April 2, reassessing the allure of "brand USA" and fretting about a new recession. The Trump administration then paused tariff rollouts and subsequently began announcing deals that cap tariffs at lower levels than initially proposed. Stocks rebounded, with the SP 500 soaring 27.2% from its April 8 close to its July 31 close, setting a series of new records. CoreData, however, found that 49% of institutions believe that markets now are too complacent about the impact of U.S. tariffs. U.S. consumer prices increased by the most in five months in June, according to Consumer Price Index data, suggesting that tariffs are boosting inflation. Other data points to a moderation in economic activity, and second-quarter growth was mainly strong because imports were weak. Global asset manager Man Group, which manages roughly $193 billion, is wary of overweighting U.S. assets. 'This is an opportunity for investors to take some profits, rebalance and go to neutral on the U.S.," said Kristina Hooper, chief market strategist at Man Group. Beyond tariffs The dollar's status as the global reserve currency may be in question as the U.S. forfeits the role of free trade facilitator, said Thierry Wizman, global FX and rates strategist at Macquarie Group, adding the firm expects to sell the dollar on any rally. After suffering its worst first-half performance since 1973 this year, the dollar posted its first monthly gains for 2025 in July, as investors regained confidence in the wake of trade deals. Also contributing to the reassessment of U.S. market supremacy is the risk of monetary policy being politicized. Trump has repeatedly called for lower interest rates and threatened to remove Federal Reserve Chair Jerome Powell. A recently approved tax and spending bill, meanwhile, will add trillions to the government's debt, exacerbating longstanding deficit concerns. Investors are likely to respond by seeking higher compensation for the risk of owning long-dated Treasury securities "There's very, very real risk that yields go significantly higher because of the deficit," said Man Group's Hooper. For many, the buoyant U.S. stock market and optimism surrounding the U.S. tech sector have made it hard to turn bearish. "The bottom line is that the U.S. has some of the most innovative and profitable companies in the world, and the deepest capital markets," said Kelly Kowalski, head of investment strategy at MassMutual. Anxiety about the demise of U.S. pre-eminence is "overblown," she said. Concerns over weaker foreign demand for U.S. debt have eased in recent weeks. After selling a net $40.8 billion of Treasuries in April, foreigners resumed buying to the tune of $146 billion in May, the latest government data showed. Also, while European stocks handily beat their U.S. counterparts in March, that gap has narrowed with every new trade deal announced. As of the end of July, Europe's STOXX 600 was roughly neck and neck with the SP 500. "The big factor in the room has nothing to do with policies, but technology," said Richard Lightburn, deputy chief investment officer at macro hedge fund MKP Capital Management. "It still feels like early innings for AI adoption and integration." Anthony Saglimbene, chief market strategist at Ameriprise Financial, continues to recommend a slight overweight to U.S. stocks relative to other global markets. "Call it 'exceptionalism' or just 'clarity.' The macro environment in the U.S. is comparatively more stable."
The National
9 hours ago
- The National
Abu Dhabi's non-oil foreign trade jumped 35% in first half on economic diversification
Abu Dhabi's non-oil foreign trade in the first half of this year jumped 34.7 per cent annually to Dh195.4 ($53.2 billion) as the emirate's economy continues to expand amid diversification efforts and government drives. Exports during the period grew by 64 per cent to Dh78.5 billion, while imports rose by 15 per cent to Dh80 billion, and re-exports registered a 35 per cent increase to exceed Dh36 billion, Abu Dhabi Media Office said on Sunday citing Abu Dhabi Customs' statistics. 'The growth in non-oil foreign trade during the first half of 2025 reflects the success of Abu Dhabi's economic strategies, and highlights the effectiveness of efforts made by Abu Dhabi Customs, in collaboration with strategic partners, to facilitate trade,' said Rashed Al Mansoori, director general of the general administration of Abu Dhabi Customs. 'These efforts are driven by the adoption of advanced systems, innovations, and digital technologies.' Abu Dhabi's economy expanded by 3.8 per cent annually in 2024 to reach an all-time high value of Dh1.2 trillion, state news agency Wam reported in May. The emirate's non-oil sector during the 12-month period grew 6.2 per cent to Dh644.3 billion, marking its highest annual contribution yet to the total gross domestic product at 54.7 per cent, Wam said, quoting data from the Statistics Centre – Abu Dhabi. Abu Dhabi has continued its shift away from oil and has taken several measures to attract international investors, boost its competitiveness and improve the ease of conducting business. In 2022, the emirate launched an industrial strategy to improve the contribution of the sector to the economy, by investing Dh10 billion across six programmes to more than double the emirate's manufacturing to Dh172 billion by 2031. Abu Dhabi also plans to boost the tourism sector's contribution to its GDP to 12 per cent by 2030, from 5 per cent in 2023. It has also laid out long-term strategies to further develop sectors including aviation and technology, with new investments in artificial intelligence. The increase in non-oil foreign trade underscores the strength of Abu Dhabi's economic diversification strategies and significant investments across key sectors. These efforts collectively support the emirate's growth as a leading regional and global trade and logistics hub, Abu Dhabi Customs said. Ahmed Jasim Al Zaabi, chairman of Abu Dhabi Department of Economic Development, said the emirate is increasing efforts to position the UAE's capital city among the world's most business-ready economies by 'streamlining trade procedures, deploying smart systems, and integrating services to enhance flow and accelerate efficiency'. This will help cement Abu Dhabi's position as a global trade and investment centre, and a key node on international supply chains, Mr Al Zaabi added. The UAE is signing new trade agreements that are helping it to boost trade with partner states around the globe. It has already signed 28 Comprehensive Economic Partnership Agreements (Cepas), with the latest deal signed with Azerbaijan last month. Ten of these deals – with India, Indonesia, Israel, Turkey, Cambodia, Georgia, Costa Rica, Mauritius, Serbia and Jordan – have been implemented and are operational, according to data from the Ministry of Foreign Trade. Agreements with other trading partners – Australia, South Korea, Malaysia, New Zealand, Chile, Colombia, Kenya, Ukraine, Vietnam, Central African Republic, the Republic of Congo, Eurasia, Belarus and Azerbaijan – are yet to be implemented. Talks have also concluded with the Philippines, Morocco and Armenia.
Khaleej Times
10 hours ago
- Khaleej Times
Miffed with WCL after India's withdrawal, Pakistan pull out of future editions of tournament
The Pakistan Cricket Board (PCB) has officially announced that it will no longer participate in any future editions of the World Championship of Legends (WCL), raising concerns about the tournament's fairness, integrity, and political neutrality, The Nation reported, citing the PCB. "The championship's handling of events appeared to be under invisible pressures," the PCB noted. "The apology issued later seemed motivated by a specific form of nationalism, making it difficult for us to continue our participation," it added. The decision was taken during a Board of Governors meeting, chaired by PCB Chairman Mohsin Naqvi. According to The Nation, the board pointed to "double standards and politically motivated actions." One of the most contentious issues raised by the board was the decision to award points to a team that had voluntarily forfeited a match, a move the PCB claimed as "highly questionable" and against the spirit of fair competition. The board further criticised the press release put out by WCL organisers after the India-Pakistan match was called off. It termed the communication "politically charged and prejudiced." The PCB said it would not take part in any event where the values of neutrality and fair play are undermined. The board made it clear that it will not be associated with tournaments that allow external agendas to dictate the course of the game. Earlier, the EaseMyTrip Co-founder Nishant Pitti has clarified that it will not be associated with any India-Pakistan match in the World Championship of Legends (WCL). The company clarified its stance, stating that despite entering into a 5-year sponsorship agreement with WCL two years ago, it will not associate with or participate in any match involving Pakistan. Pitti took to his X account to express support for the Indian team, while explaining the company's position. "India vs Pakistan - WCL Semi-Final. We applaud Team India @India_Champions for their outstanding performance in the World Championship of Legends. You've made the nation proud. However, the upcoming semi-final against Pakistan is not just another game. Terror and cricket cannot go hand in hand," Pitti said in his post. He further added, "@EaseMyTrip, we stand with India. We cannot support any event that attempts to normalise relations with a country that promotes terrorism. The people of India have spoken and we hear them. EaseMyTrip will not be associated with the India vs Pakistan match in WCL. Some things are bigger than sport. Nation first, business later. Always. Jai Hind." Relations between India and Pakistan have deteriorated sharply following the deadly April 22 terror attack at Pahalgam in the Indian-administered Kashmir. India blamed Pakistan for the attack — an allegation strongly rejected by the Pakistan government — which killed 26 civilians. What followed was a four-day military conflict between the two nuclear-armed South Asian neighbours in May before a ceasefire was announced. Meanwhile, South Africa Champions (197/1 in 16.5 overs) won the final on Saturday with a comprehensive nine-wicket victory over Pakistan Champions (195/5 in 20 overs). Ab de Villiers (120 not out off 60 balls, 12 fours and 6 sixes) was the hero for South Africa Champions who chased down the target of 195 with 19 balls and eight wickets in hand. For Pakistan, Sharjeel Khan had top-scored with 76 off 44 balls. Earlier, the South Africans beat Australia Champions in the semifinal, while Pakistan advanced to the final after India forfeited their semifinal. This was the second edition of the tournament, with India Champions winning the inaugural event last year.
