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BOI

BOI. Investment Environment & Opportunities in Pakistan . Jehangir Bashar Secretary, Board of Investment 28 th September 2004. INVESTMENT ENVIRONMENT. Policies Pursued. 4. Improving Economic Indicators.

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BOI

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  1. BOI Investment Environment & Opportunities in Pakistan Jehangir BasharSecretary, Board of Investment 28th September 2004

  2. INVESTMENT ENVIRONMENT

  3. Policies Pursued 4

  4. Improving Economic Indicators Source: State Bank of Pakistan (SBP), Federal Bureau of Statistics (FBS), Central Board of Revenue (CBR) 5

  5. Equal treatment of local & foreign investors All economic sectors open to FDI Foreign equity upto 100% allowed No Government permissions required Attractive incentive packages Remittance of capital, profits, dividends, royalty, technical & franchise fee, allowed Network of Export Processing Zones/ Industrial Estates Import of raw material for export manufacturing zero-rated Bilateral Agreements : Investment Protection: 46 countries Avoidance of Double Taxation: 52 countries Liberal Investment Policy 6

  6. Policy Package * Specified Industries: i) Arms and ammunition ii) High explosives iii) Radioactive substances iv) Security printing v) currency and mint PME= Plant, Machinery and Equipment IDA= Initial Depreciation Allowance 7

  7. BOI Board of Investment Established Trade & Physical Infrastructure Two seaports (third one under construction) Well established network of dry ports Air links to all major cities Extensive rail and road network Modern telecom facilities Trade facilitation (reduced clearance time and simplification of customs procedures) Well established banking system Low mark up charged by banks Securities & Exchange Commission of Pakistan (SECP) oversees the Company Law and ensures good corporate governance Quick registration process by SECP 8

  8. BOI Board of Investment Attractive Investment Climate Strong privatization, liberalization, deregulation Stable exchange rate Increasing reserves Vibrant capital market Independent regulators Reformed banking system Increasing FDI & foreign remittances Improving Credit Rating ( B2, B+) 9

  9. Business Survey (2003) ABCPBBAG • Companies participated 4145 • Opinion of the business climate • enthusiastic/optimistic 63%36% • Domestic economy improved 93%80% • External political situation improved 78%53% • Internal political situation improved 29%69% • Law & order improved 34%93% • Consistency of policies 45%64% • Implementation of policies improved 31%58% ABC: American Business Council PBBAG: Pakistan Britain Business Advisory Group 10

  10. Corporate Performance - ROE Source:Company Reports (annual accounts) ROE: Return on Equity 11

  11. FDI TRENDS

  12. World FDI Comparison With Pakistan Million US $ Billion US $ 13

  13. Pakistan Investment Inflows (1990 – 2004) 950 798 Million US$ 03/04 Source: State Bank of Pakistan 14

  14. Pakistan: Sources of FDI (1990 – 2004) Value in Million US$ Total : $ 7.782 Billion Source: State Bank of Pakistan 15

  15. Pakistan: Sectoral FDI (1990 – 2004) Total : $ 7.782 Billion Source: State Bank of Pakistan 16

  16. FDI Inflows (2003-04) 17

  17. Pakistan - Home To Over 600 Multinationals Deutsche Bank 18

  18. US Companies in Pakistan Members of American Business Council 19

  19. - American Express Bank - Citibank - American Life Insurance - New Hampshire Insurance - ACE Insurance - DHL - Gerrys International - Beckton Dickson - KODAK - Coca-Cola - Intel Corporation - NCR Corporation - Unisys Pakistan - 3M Pakistan Prominent US companies in Pakistan 20

  20. INVESTMENT OPPORTUNITIES

  21. Priority Sectors IT & Telecom Agriculture Oil & Gas Power • Agri-business • Corporate farming • Fruits & vegetables • Livestock & dairy • Fisheries • Cool chains • Storages • Seed production • Hydel • Thermal • Coal • Solar • Wind • Biogas • Offshore & onshore exploration • Refining • Pipelines • Storages • Call centers • Cell phone • E-Commerce • Software • IT Parks 22

  22. Priority Sectors Mining SMEs Infrastructure Tourism • Value added textiles & leather • Electronics • Sports & surgical goods • Furniture • Gemstones & jewelry • Hotels • Resorts • Theme parks • Cultural tourism • Entertainment centres • Ports • Roads • Urban Mass Transport • Water supply & sanitation • Housing • Desalination • Coal • Granite • Marble • Semi-precious stones • Copper • Rocksalt 23

  23. BOI Board of Investment Export Oriented Industries • Textiles • Cotton fabrics • Madeups • Cotton yarn • Knitwear & readymade garments • Leather & leather products • Footwear • Surgical instruments • Sports goods • Carpets 24

  24. PRIVATIZATION

  25. Privatization Program Covers all sectors of the economy Major transactions in finance, industry, telecom and power Two pronged strategy: - Strategic sale - Selling shares via stock market 26

  26. Privatization Recent Successes • 18 transactions (Rs. 49.6 billion) • Cement, hotel, banks, oil & gas • Habib Bank Limited Rs. 22.4 billion • Pakistan Petroleum Limited Rs. 5.6 billion • Sui Southern Gas Co. Rs. 1.7 billion • Pakistan International Airline Rs. 1.3 billion Privatization Proceeds 27

  27. Strategic Sale: Faisalabad Electricity Distribution Jamshoro Power Pakistan State Oil (PSO) Karachi Electricity Supply (KESC) Oil & Gas Development Corporation Ltd. (OGDCL) Pakistan Telecom Co. Ltd. (PTCL) National Investment Trust (NIT) Pak Arab Fertilizer Pak American Fertilizer Upcoming Transactions Shares to General Public • Kot Addu Power Company 28

  28. BOARD OF INVESTMENT

  29. BOI Vision “To promote domestic and foreign investment to enhance Pakistan's international competitiveness and to contribute to economic and social development” 30

  30. BOI Services • Investment promotion • Investors facilitation • 30 HICs in 22 countries; 3 in USA • Visa assistance • Website • Publications 31

  31. Board of Investment plans to organize investment conference(s) in USA in March/ April 2005 32

  32. BOI Board of Investment Thank You

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