ISLAMABAD – The Islamabad Chamber of Commerce and Industry (ICCI) said that special emphasis would be placed on identifying barriers that discourage investment in Pakistan while onus should be placed upon domestic investment in a concerted effort to drive economy out of recession.
“Domestic investment is one of the major determinants in sustainable long-term economic growth but Pakistan’s domestic challenges are driving investors away,” ICCI President Mahfooz Elahi said while addressing a federal investor’s community here. He was reacting to a report that Pakistan’s foreign direct investment were dwindling at a fast rate, every year.
Elahi said that foreign direct investment’s net inflows is now less than two percent of the GDP while domestic investment accounts for more than 15 percent of GDP, thereby necessitating that the government to make the right moves to mobilise domestic investment that plays such a crucial role in economic growth and sustainable development.
The ICCI President said that a more stable socio-economic and political environment will be the key to boosting domestic investment over the long run in order to attract higher levels of private investment. He also opined, like in other regional countries, the government should maintain stable policies. Pakistan’s fiscal and balance of payment problems and its precarious foreign exchange reserves position is under considerable strain making the macroeconomic environment less conducive to investors, he said.
He said that some drastic and far-reaching measures are needed to reduce the fiscal deficit on one hand and to alleviate the trade imbalance and replenish foreign exchange reserves simultaneously. The president said that there was also a pressing need for the development of a close working relationship between the government and businesses, industries and chambers within the country to create investment opportunities.
He urged the government to announce attractive packages to make Pakistan a more welcoming opportunity for local and foreign investors who wish to explore and optimize the potential of cheap labour, real estate and a vast consumer market.
