ALKHOBAR, 8 December 2003 — Dr. Abdul Hafeez Shaikh is Pakistan’s minister for investment and privatization. His is a tough job given the fact that at one time, Pakistan had a big problem of corruption. Violence, lawlessness and breakdown in infrastructure kept investors away.
Speaking to Arab News, MIT-educated Dr. Shaikh, a former World Bank country head in Saudi Arabia, said that things were not the same. Pakistan’s economy had made great strides. The investment scenario was very favorable for businessmen.
What was Dr. Hafeez Shaikh offering that was different and would make investors look at Pakistan’s way for investing money? “To attract foreign investors we have to do many things right: Good, consistent economic policy, better governance, transparency, less corruption and good investment opportunities.”
Dr. Shaikh said that Pakistan was one of the best places to invest in. “We have extremely good economic policies. Our macro economic policies are market-oriented. We have no restrictions on the amount equity or the capital you can bring in or repatriate from your profits. We have a stable exchange rate. Our growth rate of over 5% is the 4th highest in Asia. Our stock exchange was one of the best performing in the world. We have over 600 multinationals operating in Pakistan. The rate of return is anywhere between 20 percent and 60 percent.”
In the last two years Pakistan’s economy has made enormous progress toward recovery and establishing investor confidence. “In the past four years, we have had no financial scandal at the top level which is rather unique for a Third World country. Transparency International and other agencies which track such things, acknowledged great improvements.”
There was also a big jump in foreign confidence and thus investment. “In the 1990s our average traditional foreign trade investment was in the area of $500 million. Last year it went up to $800 million. Our potential is much higher and that’s what we are aiming for. Eighteen months ago when we tried to privatize Habib Bank, there was only one foreign bidder. This time we had five. People are realizing this particular government is serious. We mean business. The efforts we make take time to mature. We have to keep going consistently in the direction we have taken.”
Dr. Shaikh said the fact that Pakistan lived in a difficult neighborhood also had its implications. “If things are going well for us and there is a war in Iraq or Afghanistan, we suffer a setback.”
What about trade with Saudi Arabia? The love and support Pakistan and the Kingdom express for each other did not seem to translate into foreign trade and investment.
Dr. Shaikh said that in the last one year, the amount of investment activity had increased and there were enormous, mutually viable sectors of investment like agriculture, fisheries, oil and gas and coal industry. Pakistan’s 200 billion tons of coal was the 6th largest reserve in the world.
“I am very optimistic. Saudi Arabia and Pakistan are looking into many things. It will yield results in the next year to eighteen months.”
