Overall exports to Europe recorded a modest decline during July-September, although shipments to southern and northern European countries posted growth, raising concerns among policymakers about the country’s weakening export performance.
The ongoing conflict in the Middle East has added to the challenges facing Pakistani exporters, while the European Union’s preferential trade arrangements with India have increased competitive pressure on Pakistan, particularly in the textile sector.
According to State Bank of Pakistan (SBP) data, exports to European countries fell 1.84 per cent to $2.350 billion in the first quarter of FY27, compared with $2.394 billion in the corresponding period last year.
Trade analysts fear that the Middle East conflict could further weaken demand for Pakistani products as rising energy costs put additional pressure on European consumers. The region’s purchasing power is already facing challenges from the economic consequences of the Russia-Ukraine war.
Despite the overall decline, exports to northern Europe increased 21.07pc to $236.321 million during the quarter, up from $195.191 million a year earlier.
Similarly, shipments to southern Europe rose 5.26pc to $879.896 million from $835.862 million in the same period last year.
Spain emerged as a major contributor to this growth, with Pakistani exports increasing 17.78pc to $451.244 million, compared with $383.122 million a year earlier.
However, exports to Italy dropped 8.49pc to $298.731 million from $326.460 million. Shipments to Greece, meanwhile, increased 3.52pc to $34.961 million against $33.774 million in the corresponding period last year.
Eastern Europe recorded a sharper decline, with exports falling 15.05pc to $168.761 million during 1QFY27, compared with $198.677 million in the same quarter of the previous fiscal year.
The United Kingdom, which served as one of Pakistan’s major export destinations before Brexit, recorded improved trade performance in the post-Brexit period. Exports to the UK increased 6.64pc to $612.305 million from $574.171 million a year earlier.
Western Europe, comprising major trading partners such as Germany, the Netherlands, France, Italy and Belgium, remains the largest European destination for Pakistani exports. However, shipments to the region declined 8.51pc to $1.065 billion in the first quarter of FY27, compared with $1.164 billion in the corresponding period of FY26.
