Pakistan told corruption, security hurdles for investment

LONDON: A key city business conference here heard that financial corruption and the law and order situation were the biggest hurdles in attracting foreign trade and investment in Pakistan.
The “Doing business in Pakistan” conference held here jointly by the UK Trade & Investment and Pakistan High Commission heard Lord Green, Minister for trade & Investment, Saleem Mandiwala, Chairman Board of Investment, Adam Thomson, British High Commissioner to Pakistan and Wajid Shamusl Hasan, Pakistan High Commissioner to UK, chart out plans for attracting more British businesses to invest in Pakistan.
Over 80 business representatives from the UK and Pakistan attended the conference. Lord Green, speaking a day after the launch of the UK government’s Trade and Investment White Paper, said “Pakistan will be one of the world’s drivers of growth in years to come, notwithstanding some of the challenges of the present.
“For UK companies deciding on which export markets to target, it is important that they look to those markets that are experiencing growth. There are significant opportunities for partnership between UK and Pakistan firms and I would encourage business people to explore these with the help of UK Trade & Investment.”
Noting that Britain remains Pakistan’s second largest trading partner, he said 60 years ago, there were only 10,000 Pakistanis in the UK and today the number of British Pakistanis is well over 1 million, making Islam Britain’s second largest faith and enriching British life.
He said trade and market openness was central to the new British policy and Pakistani stood to benefit from it. He said Pakistan’s expanding youth, middle class and growing English speaking population provided opportunities for Pakistan but warned that addressing the challenges of security and corruption must be overcome.
He also said that political stability and law and order situation had a role to play in foreign investments and UK was keen to help Pakistan deepening bilateral relations.
He mentioned how Britain was serious in helping Pakistani youth through education, adding that a number of leading educational institutions were imparting education through online courses and campus presence in Pakistan.
Saleem Mandiwala admitted that investors were shy of going to Pakistan due to its engagement in the “war on terror” but also acknowledged that corruption was another hindrance. “Despite these challenges, Pakistan economy has been able to sustain an acceptable growth rate of 4.1% in 2009-10,” he told the conference.
He said bilateral trade is already worth more than £1 billion annually and over 100 British companies are operating successfully in Pakistan. He set the target to increase the trade between the two countries to £2 billion in 5 years.
Giving an overview of the business opportunities available in Pakistan, Mandiwala told British entrepreneurs to take advantage of the government’s liberal investment policies to make further investments to help sustain economic growth and poverty reduction and help create jobs for the people of both countries.
The British High Commissioner to Pakistan Adam Thomson told the conference had seen a different kind of Pakistan that was different from the media portrayal.
He said Pakistan was a victim of misperceptions. He said 5 times more people die in Mexico in drug related violence yet the country continues to remain a top tourist destination. He spoke about the opportunity and engagement in Pakistan but also made clear that the country self-harms from corruption and quoted the Global Competitiveness Report 2008-2009 which ranked Pakistan 101st out of 130 countries and in which respondents pointed to corruption as the second most problematic factor for doing business, after government instability.
He recognised that Pakistan’s politicians face immediate, tough decisions on economic restructuring but added that democracy is putting down roots and despite global recession, Pakistan’s economy has grown year on year.
Speaking about the issue of corruption, the high commissioner said: “it’s a problem about which it’s widely considered that the government of Pakistan is insufficiently serious. “I know British businesses that have had to pull back because a deal smelt bad.”
But he said Pakistan offered huge opportunities, as it’s the 6th largest country in the world; it’s already a large economy, GDP (Purchasing Power Parity) at $460 billion; and it has the 7th largest pool of scientists and engineers in the world.
The Chief Executive, Hubco Power, Vince Harris said, he was in constant challenging and dynamic environment of Pakistan, HUBCO over the years had consistently rewarded investors with a stream of attractive half-yearly dividends and a share price profile at or above the Karachi Stock Exchange market, which has given confidence to the shareholders to expand the business with the building of two additional power plants, taking the company to a $2 billion total investment. Wajid Shamsul Hasan said further British investments in Pakistan were needed to ensure sustained economic growth, strengthen democracy and promote political stability.