THE COMPETITIVENESS SUPPORT FUND (CSF), established as a joint initiative of the Ministry of Finance (MOF), the Government of Pakistan (GOP) and the United States Agency for International Development (USAID).

WHEREAS, the Trade Development Authority of Pakistan (TDAP) is mandated to develop trade potential and facilitates exporters in overcoming difficulties faced by them on the supply and demand side of exports.

WHEREAS TDAP helps exporters to participate in exhibitions abroad and sends delegations to export markets with a view to explore new markets and develop traditional markets.

WHEREAS TDAP has established training institutes and projects in various export sectors to train necessary manpower that can manage the export trade and industry, professionally, meeting the requirements of the export markets.

WHEREAS TDAP has identified important regional links in energy, food (including agro-processing), transport (road-rail linkages) and others that will increase markets for Pakistan's manufactured goods and commodities.

WHEREAS TDAP is likely to play a key role in the development of trade, including with Afghanistan and Central Asia.

WHEREAS, CSF has been established to support Pakistan's goal of a more competitive economy by providing input into policy decisions, working to improve regulatory and administrative frameworks and working to enhance public-private partnerships within the country. The CSF will also provide technical assistance and co-financing for initiatives related to entrepreneurship and the private sector with research institutes, universities and business incubators that contribute to creating a knowledge-driven economy.

WHEREAS, the CSF has a number of windows for funding policy relevant analysis on innovation and competitiveness, providing matching grants for knowledge-based economic development, promoting business-academia tie-up, promoting business incubator programs to promote innovation-driven sustainable economic growth in Pakistan.

WHEREAS, CSF has undertake a number of trade and development related activities, studies, interventions and prepared various Action Plans. These include assistance to motorcycle exporters, a major study entitled the "Competitive Advantage of Food Processing in Pakistan: Focus on Quality and Standards" and a series of background papers and studies covering fisheries (especially for Karachi Fish Harbour, Pasni and Gwadar) in the light of banned seafood exports to the European Union, horticulture and livestock.

WHEREAS CSF has established a close relationship with the international competitiveness community to benchmark and showcase competitiveness initiatives undertaken in Pakistan.

WHEREAS CSF has also undertaken research related to Pakistan's trade and investment with Afghanistan and the Central Asian countries to promote crossborder cooperation in the region.

WHEREAS Pakistan is working to establish trade and investment linkages with the Central Asian Republics, including energy corridors (gas from Turkmenistan and electricity from Kyrgyzstan) within the context of the CAREC regional program sponsored by the Asian Development Bank.

NOW, THEREFORE, as many of the fundamental objectives and programs of TDAP and CSF have significant commonalities, both agree to work together for the national development of Pakistan's trade on the following terms:

Objectives

• CSF will facilitate the work of TDAP with regard to overall issues and analysis related to Pakistan's competitiveness in global markets.
• TDAP and CSF will organize workshops in each of four provinces in Pakistan on the linkages between trade and investment to broaden the export base and increase the competitiveness of the Pakistan economy.
• CSF will provide support and technical assistance to TDAP with regard to export promotion. In particular trade relations with the countries in the region will be supported under the forthcoming USAID program on empowering Pakistan trade.
• CSF will provide important links between TDAP and other relevant agencies, the private sector and foreign investors and other stakeholders engaged in trade with Pakistan.
• CSF will work with the TDAP, other agencies of the GOP and international donors and the private sector to facilitate the implementation of the National Trade Corridor Project as it applies to agro-processing and rural market infrastructure (especially cool chains and storage) that facilitates trade.
• CSF will work with TDAP to develop export-oriented agro-processing. Markets in the region including Afghanistan and Central Asia will be targeted. In particular export markets in Central Asia for Pakistan seafood will be explored. In this regard, CSF will assist TDAP and the Ministry of Investment and explore the possibility to undertake trade delegations to and organize For and on behalf of Competitiveness Support Fund workshops in Central Asia. In this respect the first workshop may be held in March or April 2009.
• Based on CSF's MOU with the Ministry of Investment CSF, MOl and TDAP will jointly undertake a fact-finding missions to Central Asia in order to organize conferences on cross-border cooperation in Central Asia, Afghanistan and Pakistan. The conference will include relevant parties from all 5 Central Asian republics, Afghanistan and Pakistan.
• 8. The CSF will assist TDAP in developing a holistic approach to trade development, export quality standards and regulations and set up appropriate vehicle to carry forward these objectives.

IN WITNESS WHEREOF, this Memorandum of Understanding is executed this 19th day of January, 2009 in Islamabad by the undersigned, acting through their fully authorized representatives.