Federal Commerce Minister Khurram Dastgir Khan on Monday said that China is Pakistan’s major trading partner with volume of trade reaching an all-time high of $12.299 billion in 2014-15.
“Pakistan has huge investment potential in various sectors including energy, infrastructure and agriculture sectors,” Dastgir said while addressing Pakistan-China Business Opportunities Conference. He further said that advantage of the opportunities and participation in these sectors will work for the mutual benefit of two countries of Pakistan and China.
He said meetings between Chinese delegation and traders of Pakistan will promote trade between the two countries. “Pakistan has one of the most liberal foreign investment regimes in South Asia. 100% foreign equity is permitted in the manufacturing and infrastructure sectors, as the country has a market-oriented economy, with a rapidly growing private sector”, the Minister of Commerce said.
He further said that government is focusing on improving investment climate in the country through the implementation of Investment Strategy 2013-17 that hinges upon Public-Private Sector Dialogue (PPD) for policy formulation, FDI Generation and Promotion Campaign, Investment Facilitation (one window operation), Development of Special Economic Zones (SEZs) and Coordination networks with stakeholders.
Dastgir noted that energy shortage alone causes a loss of about 2% of Pakistan’s GDP annually. “We are currently engaged in efforts on economic recovery, improved security and good governance to attract local and foreign investment ,” he added.
Talking about the economic achievements of the government, the commerce minister said that Pakistan’s economy has turned the corner and has made significant progress over the past two and half years. Pakistan achieved seven years highest growth of 4.24 percent in financial year 2015. Fiscal deficit has been brought down to 5.37 percent of the GDP in Financial Year 2015 from 8.2 percent of the GDP of the year 2013. “There has also been a significant increase in Pakistan’s foreign exchange reserves, which have now reached the record level of over US$ 20 billion”, he remarked.
He also highlighted the Free Trade Agreement signed by Pakistan and China on 24th November 2006, which became operational from 1st July 2007. Later, a Free Trade Agreement on trade in services was also signed on 21st February 2009 and is operational since 10th October 2009. Prior to signing of FTA the volume of trade between the two countries was in vicinity of $4 billion out of which exports from Pakistan were $575 million. Over the years the trade volume has leapfrogged to $12 billion with Pakistan exports bourgeoning to $2.1 billion in 2014-15, a more than three and a half times increase.
Addressing the Conference, Minister for Planning and Development Ahsan Iqbal said the friendship conference would strengthen trade relations between Pakistan and China. He expressed the hope that forty-six billion dollars Chinese investment on China-Pakistan Economic Corridor (CPEC) will go up to hundred billion dollars.
He also highlighted Pakistan’s Vision 2025 that seeks to position itself from a lower middle income country to high middle income country by achieving the target per capita GDP of $4200. In order to achieve this goal and create employment opportunities for new entrants into the labor force, he said that government aims to target a growth rate of 8 percent between 2018 and 2025 with single digit inflation. The Vision has other macroeconomic targets as well, it seeks to increase exports from the present $25 billion to $150 billion, tax-GDP ratio to 16-18 percent, investment rate in the range of 22-25 percent of GDP through domestic saving of 18-21 percent and foreign saving of 3-4 percent of GDP in the long run, he added.
Chinese Ambassador to Pakistan Sun Weidong said that China’s direct investment in Pakistan has reached to $3.6 billion. He further said that implementation process of CPEC is going on smoothly as it enjoyed the support and backing of the people.
The conference was attended by a hundred member delegations from China, heads of Chinese Companies working in Pakistan and prominent traders and businessmen of Pakistan.