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| Sunday, 20 March 2005 |
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Features |  |
| News Business Features Editorial
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Pakistan Day falls on Wednesday March 23 Pakistan: Taking off by Shaukat Aziz, Prime Minister of Pakistan When we started planning for economic growth five years ago, we projected a growth rate of between 6 to 8%. Five years on and we are in that range. Per capita incomes are up. We will cross $700 hopefully this year and purchasing power parity will cross $2,000.
Demand growing, Though we are very conscious of the fact that people below the poverty line need to be taken care of, we are happy that demand is growing, which is obviously going to create opportunities in many areas. Energy needs are rising. Electricity consumption is increasing rapidly. Infrastructure is being built rapidly - ports, roads, highways and so on. We are also seeing an influx of people from overseas. Foreign Direct Investment is rising. Today one of the challenges that we have is finding enough hotel rooms for visitors in Pakistan. If we can get more planes we can fly more flights into Pakistan. Because getting in and out can be challenging as the capacity was not there and suddenly we see a surge. After many years the trend has been reversed and we are sure that this trend will continue positively. Business For those who are already doing business in Pakistan, you should be seeing growth of at least 20% in your annual revenues. If not, you are not managing your business well. What the government can give you is a tailwind, a very strong tailwind. And if you have a tailwind then it is up to you to leverage the opportunity. We don't know business. We dodn't want to be in business. Our philosophy is very clear. Create an enabling environment, open the door. Let people walk in. Not everyone will perform the same way. But we in the government are creating an environment which will be healthy. Our macro numbers look good. One number we are very proud of is the growth rate. Second for any developing country is the fiscal deficit. We are down to 3% of GDP, from 7% five years ago. The notion that you need fiscal responsibility if you get growth is a flawed notion. We have proved that we have reduced the deficit and growth has gone up at the same time. We live in a neighbourhood which constantly attracts world attention. We are pivotal in our region - China, Afghanistan, Iran and the whole of South Asia and West Asia too. No matter what happens in the world, one of these countries is on the global radar screen. We think Pakistan, a country of 150 million people, with human capital and skills which are second to none, can be a stabilising influence and an anchor of peace in the region. We have no aggressive designs against naybody or any country. We want to live in peace. We want the economy to grow and we want to have friendly relations with everybody. This is the reason why we are in a very healthy composite dialogue with India. With China we have a very close relationship. With Afghanistan, our two economies are integrating. This year our export to Afghanistan will be a billion dollars. Next year it could be higher. Because we are physically close, and because Afghanistan is landlocked, families are on both sides of the border. We also house 3.5 million Afghan refugees to this day. We are encouraging them to move to the other side of the border. But we will not push them. They have to see the advantages of going back. We work closely with the Afghan government to create the absorptive capacity to attract them back. And we are making progress. Continuity and consistency What we are also trying to do is to maintain continuity and consistency of policy. Pakistan's structural reform agenda in the developing world is in the top tier. In some areas we have done well; some areas need more work done. But the overall framework of structural reforms was one of the most important factors in improving our situation. Which bring me to two points. The reform agenda we started was entirely home-grown. Then we worked with the International Monitory Fund to put it in a certain form. We executed it and now have graduated from the Fund. We are no longer borrowing money from them. We are also in the international capital market. We did a Euro Bond issue last year which was very successful. We expected about $500 million; subscriptions were about $2 billion. We only took $500 million and returned the rest. We have just completed a bond issue last month. We expected $300 million; the subscriptions were $1.2 billion. This time we took $600 million. This happened because the pricing was so good and markets are flush with liquidity. So we thought that with this pricing we should take double of what initially we thought we would. The rating agencies are all saying that the outlook good and the ratings are good. Working hard The Pakistan of today and tomorrow is not the Pakistan of yesterday. The perception which we want to create is of a country which is working hard to improve its own future and working with its friends to develop into a country which is stable, vibrant, moderate and modern. All these things are not contradictory. It can be done if we have the will and right leadership. President Musharraf and I are working very hard to achieve these objectives. As the world evolved from the challenges being faced since 9/11 particularly, we are improving our government, improving how we tackle some of the challenges which we face. . That means also that we have a lot more to do. And we are determined to
do all that. |
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| Produced by Lake House |
These are good numbers and we are heading in the right direction. Because
of high growth, what we are seeing is the emergence of a growing middle
class in Pakistan. To buy a car we have to wait six months or pay a premium.
Consumer credit is also fuelling this demand. People feel that they need a
better lifestyle. 
