News
Monday, March 01, 2010
Country targeting $5bn in foreign investment
* Board of Investment chairman says improvement dependant on global conditions
* Pakistan trade minister in Washington says US needs to lift tariff barriersISLAMABAD: The country aims to attract foreign investment worth $5 billion this year, but needs to tackle reform, maximise anaemic growth and stem rampant violence to clinch its ambitious target.
Last fiscal year, Pakistan recorded its worst economic growth in more than a decade, at two percent, and attracted only $3.7 billion in investment.
Yet Board of Investment Chairman Saleem Mandviwalla is optimistic in spite of immense challenges the country faces.
Contingent: “Traditionally the investment pace that we had kept — which was an average of $5 billion a year — I think we should be able to go back to it very soon depending on improvement in the global situation,” he told AFP.P.
“Pakistan faces the global crisis which is going on, the financial crisis, the energy crisis and then on top of these we have the security situation,” Mandviwalla, who is also a state minister, said.
“With terrorism and the energy crisis we are not able to rake in investment the way we should,” Mandviwalla said, adding that the country, with its relatively advanced infrastructure, is doing better than other developing countries.
The top three countries providing foreign direct investment (FDI) so far this fiscal year are the US, with $347.5 million, Britain, $119 million and the UAE, $121.8 million, according to the Board of Investment.
The biggest investments flowed into oil and gas, communications and information technology, and power generation, its documents said.
Azmat Ranjha, the minister for trade in the Pakistani embassy in Washington, acknowledged that investment from the US — the country’s largest trading partner — had slipped because of security concerns.
But he said it was largely a matter of perception and pointed to fresh investment by large US companies with long experience in Pakistan such as Coca-Cola and Procter & Gamble.
“If you’re a start-up, the perception you get once you read all these newspapers is that it looks fairly scary,” he said.
“But those familiar with the region know that most of the problems are in the north near Afghanistan while most industry is in the central and southern part of the country,” he added.
Lift barriers: Despite the $7.5 billion US aid package, Ranjha said it was crucial for Washington to lift tariff barriers.
“If the US wants to hold our hand on the path to development, there is no better way than by providing market access and that hasn’t really happened,” he said.
Economic analyst Salman Shah said the $5 billion target would be achievable if the government focused more on boosting the economy’s disappointing growth rate and lowered interest rates to single digits. afp
Courtesy www.dailytimes.com.pk