11 joint ventures inked for Allama Iqbal Industrial City by the Chinese companies: Ambassador Yao Jing

ISLAMABAD: China’s Ambassador to Pakistan Yao Jing said on Wednesday that China Pakistan Economic Corridor (CPEC) is purely a commercial project that had nothing to do with security cooperation.

Both the countries, he said, now started establishing joint ventures (JVs) under CPEC framework of industrial cooperation for boosting Pakistan’s exports.

“We are now focusing on four Special Economic Zones (SEZs) including Rashakai, Dahbiji, Faisalabad and IT related SEZ in the federal capital. The SEZ requires state of the art infrastructure and there is share of localisation of 80 percent so it takes much longer time to develop SEZ,” Ambassador Yao Jing said while addressing round table conference titled “Searching for Economic Security and Growth” organised by Institute of Policy Reforms (IPR) here at COMSTECH Auditorium on Wednesday.

He said that the second phase of Free Trade Agreement (FTA) would help Pakistan achieve its economic objectives. He said that he did not agree to this assertion that the first phase of FTA had wiped out Pakistan’s industry. He said that the number of Chinese labour working on different projects are decreasing. There are many projects, which are under construction with help of local partners, he maintained.

He said that both Pakistan and Chinese experts possessed different projections about Pakistan’s power sector requirements up to 2025 as surplus power exists but the Chinese companies working here in joint ventures complained that it required two years to get electricity.

He said that there were three new areas of future cooperation under the second phase of CPEC as industrial cooperation through joint venture were aimed at boosting exports as 11 joint ventures had already established in SEZ at Faisalabad. He said that agriculture sector cooperation on account of establishment of joint laboratories and technical centers are under way. He said that 15 vocational centres would be established.

He said that the Business Forum was also established in order to increase capacity of big manufacturers to boost Pakistan’s exports.

He said that there were 25 projects underway through CPEC mechanism and most of them would be completed in first half of the current year. He said that China wanted to convert Gwadar Port into commercially viable port. He said that the energy projects were completed and it was contributing 30 percent in national grid.

Moeed Yousaf, Minister of State and Special Assistant to PM on National Security and Strategic Policy Planning said on the occasion that his first assignment after joining the government was devising economic diplomatic strategy, as it required paradigm shift for achieving the desired results. The CPEC, he said, possessed important vision because Pakistan required sustained and long-term growth trajectory as it would help establish right kind of synergies to achieve the desired objectives.

Earlier, the IPR Chairman who is former minister Humayun Akhtar Khan made a presentation about reasons of perpetual economic crisis that always emerged when the country achieved higher growth trajectory so it again landed in IMF programme owing to eruption of balance of payment crisis. Humayun Akhtar Khan said that the higher GDP growth was key in case of East Asia and China for achieving prosperity as China excluded 700 million people from clutches of poverty. The economic growth, he said, linked to security and sovereignty of the country.

Since 1953, he said that Pakistan achieved average growth rate of 7 percent for only 12 years and the county achieved higher growth when external aid was received in abundance. Alarmingly, he said that the share of industry and agriculture had consistently fallen from 2000 to 2019.

He said that debt grew faster than GDP that’s why the country landed in IMF programme for 22 to 23 times. The fragile macroeconomic conditions coupled with low savings and investment rates resulted in re-surfacing of imbalances on economic front. He said that the savings and investment in percentage of GDP required to be increased from 15 to 25 percent in order to unlock the real potential of growth for Pakistan.

Yawar Ali, Chairman Pakistan Business Council (PBC) said that Pakistan needed charter of economy. He said that the government would have to slash subsidies by bringing improvement in State Owned Enterprises (SOEs). He said that the biggest problem of the country was increasing population that would be required to reduce on immediate basis.