Karachi: Investment related policies and practices in Pakistan are more attractive in comparison to countries like China, India, Thailand, Malaysia, Sri Lanka, however, there is a need to fill the gap and have these policies implemented in true spirit to make Pakistan an even more investment friendly country.
This was stated by Asif Jooma, President Overseas OICCI while addressing annual gathering of the OICCI at the Presidency in Islamabad.
Mr. Jooma said that with a view to addressing this gap, we request institutionalising a formal quarterly, if not monthly, review of the top ten issues faced by foreign and local investors. We have seen this system work in our respective businesses and would be happy to share with the government an outline of the proposed system if desired. we also recommend a structured performance monitoring process for all key Government functions directly linked to economic, business and industrial growth.
He mentioned that presence of not only the top executives of all multinational businesses in Pakistan who represent some of the fortune 500 companies but more significantly important guests like, Chairman Merck global Mr. Karl-Ludwig Kley who is also the Vice Chairman BMW, is a testimony that the global business community gives immense importance to Pakistan and is proud to be a partner in its progress.
Asif Jooma said that OICCI’s 189 member companies operate in 14 key sectors and contribute in excess of 20% of the country’s GNP and tax revenue besides providing direct and indirect employment to over a million people.
“On an ongoing basis, our member companies are engaged in numerous community development programmes, providing a sustainable source of income generation for the less fortunate members of our community through structured CSR activities,” he added.
As responsible corporate citizens, OICCI members have always been there when natural disasters have struck Pakistan and the members’ contributions to the relief efforts following the devastating floods in 2010 were in excess of Rs. 2 billion.
“Our members have the capacity to provide exponentially greater revenues, increased investments, enlarged job opportunities, and more contribution to CSR activities. Sadly though, this potential although huge, is not being adequately realized,” Jooma added.
Asif Jooma said that despite advocating Pakistan at every forum by marketing the opportunities it provides, there are not many tangible business starts on the ground, as evident by the recent decline in FDI into Pakistan to a mere US$ 813 million in 2012, compared to twice this amount in 2011. “However, In spite of the fall in external inflows, our members have in the last one year invested US$ 1 bln from retained earnings to further expand and embellish their operations in Pakistan.”
Asif Jooma drew the attention of President Asif Ali Zardari to a few issues that need to be addressed claiming that and if done, these would vastly improve the macroeconomic and investment climate. One of the major issues amongst these is the low tax to GDP ratio. The inability to expand the tax net continues to overburden the documented corporate sector, of which our members comprise, he added.
The President OICCI declared the corporate tax rate at 35% much too punitive with undue burden continuing to be placed on the documented sector. The answer, he believed, lies in reducing the tax rate and eliminating the exemptions that mar the tax structure. “We feel all major political parties need to think alike on this matter,” he added.
Raising the issue of Intellectual Property Rights, he was happy to note that the relevant law has been passed by the Parliament and is pending ratification with the President and will turn out into a complete law on his signing this document. “Should this happen, Pakistan will be better placed in future reviews of the US 301 watch list which will positively impact the flow of FDI into the country,” he added.
Thanking President Asif Ali Zardari for gracing the occasion, Asif Jooma reiterated the OICCI’s commitment in playing whatever role the Government would like them to play to make Pakistan a strong and stable country.
Among other distinguished guests CCP Chairperson Ms. Rahat Kaunain, SECP Chairman Mr. Muhammad Ali, along with other foreign diplomats, cabinet members and bureaucrats attended the event which is a testimony of the importance of the event and also the importance the Govt gives to the foreign and local investment.