RIYADH, 23 February 2007 — Pakistan’s Minister of Commerce Humayun Akhtar has asked overseas Pakistani investors to exercise caution in making their investment decisions.
In an interview with Arab News before leaving Riyadh, he said the prospective investors should get the complete lowdown on their business partner back home before taking the plunge.
The minister said as a rule, they should invest in the area of their expertise. “If he is a doctor, he could consider setting up a hospital. If he is an engineer, then he could establish an engineering company. We have the Board of Investment and we have the Overseas Pakistanis’ Foundation to vet proposals that are submitted to them. Moreover, we have deregulated the economy and dispensed with all the cumbersome regulations in the interest of creating a hassle-free environment for prospective investors,” Akhtar said.
He pointed out that most of the banks now belong to the private sector. “So I encourage Pakistanis living in Saudi Arabia to come back and invest in Pakistan. They could take guidelines from the institutions that are available and benefit from the incentives provided under our highly liberalized economy.”
However, he cautioned investors not to shoot in the dark. “They should know who their joint venture partners are. They should also be careful about the kind of business they are planning to enter. No country in the world can guarantee the credibility of your partner or ensure that a certain business is risk-free.”
Even so, Pakistan’s economic environment was conducive to overseas investment as borne out by the tell-tale statistics. The foreign direct investment (FDI) in Pakistan, which stood at $3.5 billion last year, was projected to reach $6 billion this year. A major component of this investment inflow was generated from the private sector in the Middle East, besides overseas Pakistanis.
These funds were channeled into the hospitality, banking, real estate, services and other sectors. He urged Saudi businessmen to also consider investing in his country.
Akhtar said multilateral trade and investment could get a shot in the arm with the conclusion of a Pakistan-GCC cooperation agreement that has been on the table for a while. In the absence of such a pact, Pakistani exporters were encountering trade barriers, he added.