Saturday, January 20, 2018

Pakistan Rising or Failing? Reality vs Perception

Pakistan has a population of over 200 million people and a booming trillion dollar economy ranked among the top 25 largest economies of the world.
Courtesy:  Ashraf Hameedi, Highforest Capital

Pakistan's 135 million millennials have made it the world's fastest growing retail market. There is surging demand for fast moving consumer goods (FMCG) and durables like smartphones, computers, cars, motorcycles and home appliances.

Courtesy: Nikkei Asian Review

Major energy and infrastructure projects, part of China-Pakistan Economic Corridor (CPEC), are transforming the country and creating millions of new jobs.

Incidents of terrorism and terror related deaths are in sharp decline since the country's military started nation-wide anti-terror operations in 2013.

Its $20 billion tourism industry is seeing rapid growth.

And yet, many continue to call Pakistan a "failed state". Why is it? Why is perception lagging reality?

Viewpoint From Overseas host Faraz Darvesh discusses these questions with Monis Rehman, Pakistani entrepreneur and CEO of Rozee.pk, and regular panelist Riaz Haq (www.riazhaq.com)

https://youtu.be/XDima7JSxKs





Related Links:

Haq's Musings

Pakistan is the 3rd Fastest Growing Trillion Dollar Economy

Pakistan Education Budget Surpasses Defense Spending

Information Tech Jobs Moving From India to Pakistan

Pakistan is 5th Largest Motorcycle Market

"Failed State" Pakistan Saw 22% Growth in Per Capita Income in Last 5 Years

CPEC Transforming Pakistan

Pakistan's $20 Billion Tourism Industry Boom

Home Appliance Ownership in Pakistani Households

Riaz Haq's YouTube Channel

PakAlumni Social Network

21 comments:

Junaid Z. said...

Thank you. It is so important to talk about positives among all the negatives that social media is flooded with. You are one person who is always balanced. I feel it's becoming more and more uncommon to see a balanced analysis coming from Pakistanis. There are many who speak out only when they have to criticize and I never see them talk about positive side of Pakistan. In the midst of such Facebook junkies and self proclaimed activists, you're a shining star! Keep doing your bit. Jahan ghalat ko ghalat kehna zaroori hai waheen sahi ko sahi kehna bhi utna hi zaroori hai.

Noor A. said...

Great Job Faraz, Riaz Haq and Monis. Hope to see more shows on the Positives of Pakistan.

Riaz Haq said...

THE EXPRESS TRIBUNE > BUSINESS
Consumer confidence in Pakistan at all-time high

https://tribune.com.pk/story/1609611/2-consumer-confidence-pakistan-time-high/

KARACHI: Pakistan’s consumer confidence has reached an all-time high of 111, up by nine points in the third quarter (July-September) of 2017, from 102 points in the previous quarter (April-June), according to the Nielsen Global Survey of consumer confidence and spending intentions.

“The nine-point increase in Pakistan’s consumer confidence score depicts an improving outlook for the country,” Nielsen Pakistan Managing Director Quratulain Ibrahim was quoted as saying in the press release.

“Since Nielsen launched the survey, this has been the highest number reached to date, which can be attributed to several reasons such as the growth in the agricultural sector, controlled inflation, strengthened power supply and most importantly, the uplift in the job market. Pakistan is flourishing and is rated as one of the top growth markets in the Middle East & Africa region.” The survey data highlights a positive perception of job outlook, increasing from 47% in the second quarter to 57% in the third.

Although there has been a one percentage point dip in job security being the biggest concern over the next six months, it still remains the top concern amongst 21% of Pakistani consumers. Consumers are spending more on vacations and technology in third quarter, suggesting that they have more disposable cash.

Regionally, there has been a one-point increase in the index level. Africa / Middle East has also witnessed a one percentage point increase in the job prospects (38%), with no change in the state of respondent’s personal finances. Spending intentions increased one percentage point to 34%.

Four out of six Africa / Middle East markets showed consumer confidence gains. Pakistan’s consumer confidence rose the most, by nine points (which stands at 111). United Arab Emirates (112), South Africa (83) and Egypt (81) were amongst the other countries showing an increase in consumer confidence index.

Conversely, consumer confidence fell in Morocco (72) and Saudi Arabia (93), declining by five points in both countries.

Established in 2005, the Nielsen Consumer Confidence Index is fielded quarterly in 63 countries to measure the perceptions of local job prospects, personal finances, immediate spending intentions and related economic issues of real consumers around the world. Consumer confidence levels above and below a baseline of 100 indicate degrees of optimism and pessimism, respectively.

Taj S. said...

Pure academic. Pure academic.
There is no clean water to drink.
Pakistan is rising. Rising to what.
Another billion $ politician on Forbs List.
Mr. Haq. You think we are that stupid.
How long you will jerk us around?
It is time to take out your head from the sand.
Go ask the parents of Zainab, if Pakistan is rising?

Riaz Haq said...

Taj: "Pure academic. Pure academic....."

Did you watch the video?

Monis Rahman is no academic. He's a successful Lahore-based Pakistani entrepreneur and a businessman running Pakistan's biggest online jobs site rozi.com

Riaz Haq said...

#Pakistan keeps #terrorists on the run and #economy on a roll
Businesses' focus shifts from bombs and kidnappings to taxes and policy. #Taliban #TTP #terrorism #India #Karachi #Rangers

https://asia.nikkei.com/Politics-Economy/Economy/Pakistan-keeps-terrorists-on-the-run-and-economy-on-a-roll

KARACHI -- Terrorism, corruption, misrule: Negative perceptions have dogged Pakistan for years. But thanks to sweeping operations by the army and a powerful paramilitary force, those perceptions may be becoming outdated, and businesses are taking notice.

In Karachi, the country's largest city, motorcycles and elaborately decorated buses weave down dusty roads between colonial-era buildings. Less than a decade ago, these were truly mean streets. "Between 2010 and 2012, we saw one or two terrorist attacks every month and one or two targeted killings and kidnappings for ransom every day," recalled Army Maj. Gen. Mohammad Saeed. "There were 17 no-go areas which the police could not touch in Karachi."

At the time, even major hotels had occupancy rates of just 10% to 15%. Hundreds of shops and other businesses closed down.

Then the Rangers began to clean up.

The Pakistan Rangers, a paramilitary law enforcement organization overseen by the military and the Interior Ministry, set out to tackle the violence head-on. In 2013, the Rangers Sindh -- which operate in Sindh Province, including Karachi -- mobilized 15,000 troops. The provincial legislature granted them broad powers to search homes and make arrests, enabling them to quickly turn the tide.

In 2017, there were zero bombings and only five kidnappings, according to Saeed, who serves as director general of the Rangers Sindh. This is no small feat in a city with a swelling population of 17 million -- perhaps even 20 million if migrants from rural areas are factored in. "We destroyed all of the terrorists' pockets," he said, adding that hotel occupancy rates are over 90%.

The story is similar in Pakistan's other major cities. And as the Rangers have made headway, business sentiment has improved and growth has picked up.

Pakistan's real gross domestic product grew 5.3% in the fiscal year through June 2017, the quickest pace in 10 years. The central bank projects the growth rate for this fiscal year will approach 6%. Inflation has stabilized and exports are brisk.

"Unfortunately, Pakistan is a victim of negative perception," said Arif Habib, who heads the conglomerate Arif Habib Group. "There is a lot of difference between perception and reality."

But the rest of the world seems to be catching on to the positive changes, too: Foreign direct investment is estimated to reach a record $5 billion or so in the current fiscal year, up from $3.43 billion last year.

Last June, in a survey by the Overseas Investors Chamber of Commerce & Industry, 89% of respondents said security concerns in Karachi had receded since 2013.

The OICCI is made up of 193 companies, mainly major foreign businesses in Pakistan. Each year, it surveys the members about factors that are hampering investment in Pakistan. "The top answer in 2015 was 'security, law and order,' but it fell to third place in 2017," said OICCI Secretary-General Abdul Aleem, who served as the chief executive of a state-run company. "It was overtaken by 'tax burden' and 'policy implementation.'"

Riaz Haq said...

‘#Pakistan #economy set to achieve 6% #GDP growth’ in current fiscal year 2017-18, says nation's central bank report

http://www.gulf-times.com/story/578803/Pakistan-economy-set-to-achieve-6-GDP-growth


he State Bank of Pakistan (SBP) said yesterday that prospects for economic growth remain strong, noting that the economy is poised to achieve the growth target of 6% for 2017-18.
In its first quarterly report on the state of the economy, the SBP said rising income levels of consumers are fuelling retail sales and commercial activities.
However, there was an urgent need for finding more avenues for foreign exchange earnings and realigning policies favouring exports growth by addressing long-term structural impediments.
“For the external sector, recent gains in exports growth and foreign direct investments (FDI) while significant were not enough to contain the overall balance-of-payments deficit,” said the report.
It added that the widening of the current account deficit associated with increased economic activity is a recurrent phenomenon in Pakistan and has undermined maturing growth cycles in the past.
While the report expressed satisfaction over the increased revenue in the first quarter of 2017-18, it said that earlier efforts aimed at increasing the tax base need to be more concerted and perhaps require new, innovative methods.
The report raised the question whether the economy is doing well enough to sustain the virtuous equilibrium of high growth-low inflation into the medium and long terms. The report stressed the need for addressing the long-standing structural reforms in the fiscal and the external sectors for sustainability.
The report analysed the recent growth in exports and identified three reasons for it. Uninterrupted energy supplies to the manufacturing sector, increasing global demand and commodity prices and the recent exchange rate deprecation.
What stands out is the role of a benign inflationary environment for some time now that has helped spur the expansion in economic activities. Low and stable prices have facilitated and eased the process of economic decision-making.
“More tangibly, falling inflation along with healthy agriculture output and stable exchange rate has resulted in higher real rural incomes and urban wages. The resultant boost in consumption forms an integral part of the current economic growth paradigm,” said the report.
Low inflation has also allowed the SBP to cumulatively cut the policy rate by 425 basis points since the autumn of 2014.
The report suggested that average inflation in 2017-18 would remain below its annual target of 6%.
However, there are two major risks to this inflation forecast: first, recent exchange rate depreciation through expectations channel and, after some lag, through the higher imported goods’ price can seep into domestic prices; second, uncertain global oil prices pose both upside and downside risks.
The report said in the first quarter, the fiscal deficit was 1.2% of gross domestic product, lower than 1.4% recorded in the corresponding period of the last year. Total revenue recovered strongly, showing an 18.9% increase in the three-month period against an 8% decline in the same period a year ago.
“Against this, consolidated federal and provincial expenditures grew 12.8% compared to 2.8% increase in the same period last year,” said the report.


A worker inspects fabric on looms at a textile manufacturing unit in Karachi. The State Bank of Pakistan said yesterday that prospects for economic growth remain strong in Pakistan, noting that the economy is poised to achieve the growth target of 6% for 2017-18.

Riaz Haq said...

India Ranks Below China, Pakistan On This World Economic Forum Index
Norway remains the world's most inclusive advanced economy, while Lithuania again tops the list of emerging economies, the World Economic Forum said.

https://www.ndtv.com/business/india-ranks-much-below-china-pakistan-on-wefs-inclusive-development-index-1803140

http://www3.weforum.org/docs/WEF_Forum_IncGrwth_2018.pdf

Davos: India was today ranked at the 62nd place among emerging economies on an Inclusive Development Index, much below China's 26th position and Pakistan's 47th.

Norway remains the world's most inclusive advanced economy, while Lithuania again tops the list of emerging economies, the World Economic Forum (WEF) said while releasing the yearly index here before the start of its annual meeting, to be attended by several world leaders including Prime Minister Narendra Modi and US President Donald Trump.

The index takes into account the "living standards, environmental sustainability and protection of future generations from further indebtedness", the WEF said. It urged the leaders to urgently move to a new model of inclusive growth and development, saying reliance on GDP as a measure of economic achievement is fuelling short-termism and inequality.

India was ranked 60th among 79 developing economies last year, as against China's 15th and Pakistan's 52nd position.

The 2018 index, which measures progress of 103 economies on three individual pillars -- growth and development; inclusion; and inter-generational equity -- has been divided into two parts. The first part covers 29 advanced economies and the second 74 emerging economies.

The index has also classified the countries into five sub-categories in terms of the five-year trend of their overall Inclusive Development Growth score -- receding, slowly receding, stable, slowly advancing and advancing.

Despite its low overall score, India is among the ten emerging economies with 'advancing' trend. Only two advanced economies have shown 'advancing' trend.

Among advanced economies, Norway is followed by Ireland, Luxembourg, Switzerland and Denmark in the top five.

Small European economies dominate the top of the index, with Australia (9) the only non-European economy in the top 10. Of the G7 economies, Germany (12) ranks the highest. It is followed by Canada (17), France (18), the UK (21), the US (23), Japan (24) and Italy (27).



The top-five most inclusive emerging economies are Lithuania, Hungary, Azerbaijan, Latvia and Poland.

Performance is mixed among BRICS economies, with the Russian Federation ranking 19th, followed by China (26), Brazil (37), India (62) and South Africa (69).

Of the three pillars that make up the index, India ranks 72nd for inclusion, 66th for growth and development and 44th for inter-generational equity.

The neighbouring countries ranked above India include Sri Lanka (40), Bangladesh (34) and Nepal (22). The countries ranked better than India also include Mali, Uganda, Rwanda, Burundi, Ghana, Ukraine, Serbia, Philippines, Indonesia, Iran, Macedonia, Mexico, Thailand and Malaysia.

Although China ranks first among emerging economies in GDP per capita growth (6.8 per cent) and labour productivity growth (6.7 per cent) since 2012, its overall score is brought down by lacklustre performance on inclusion, the WEF said. It found that decades of prioritising economic growth over social equity has led to historically high levels of wealth and income inequality and caused governments to miss out on a virtuous circle in which growth is strengthened by being shared more widely and generated without unduly straining the environment or burdening future generations.

RA said...

Riaz Sahib, what do you make of all the reports that say that the price of energy is too high compared to other countries in the energy contracts Pakistan has signed with CPEC?

Riaz Haq said...

RA: " what do you make of all the reports that say that the price of energy is too high compared to other countries in the energy contracts Pakistan has signed with CPEC?"


First, I believe it's part of a campaign of fear, uncertainty and doubt (FUD) being waged against CPEC by enemies of China and Pakistan.

http://www.riazhaq.com/2017/05/campaign-of-fear-uncertainty-and-doubt.html

Second, all the contracts awarded under CPEC follow Pakistan's longstanding IPP policy developed in 1990s that precedes CPEC. The IPP policy was designed to attract private investments in Pakistan's energy sector to meet exploding demand.


Here's an except of a Dawn piece by ex State Bank governor Ishrat Husain:


https://www.dawn.com/news/1313992


The entire energy portfolio will be executed in the IPP mode —as applied to all private power producers in the country. Foreign investors’ financing comes under foreign direct investment; they are guaranteed a 17pc rate of return in dollar terms on their equity (only the equity portion, and not the entire project cost). The loans would be taken by Chinese companies, mainly from the China Development Bank and China Exim Bank, against their own balance sheets. They would service the debt from their own earnings without any obligation on the part of the Pakistani government.

Import of equipment and services from China for the projects would be shown under the current account, while the corresponding financing item would be FDI brought in by the Chinese under the capital and finance account. Therefore, where the balance of payments is concerned, there will not be any future liabilities for Pakistan.

To the extent that local material and services are used, a portion of free foreign exchange from the FDI inflows would become available. (Project sponsors would get the equivalent in rupees). For example, a highly conservative estimate is that only one-fourth of the total project cost would be spent locally and the country would benefit from an inflow of $9bn over an eight-year period, augmenting the aggregate FDI by more than $1bn annually. This amount can be used to either finance the current account deficit or reduce external borrowing requirements. Inflows for infrastructure projects for local spending would be another $4bn over 15 years.

Riaz Haq said...

India Lacks a Competitive Trade Strategy for Chabahar
India needs a sound economic and political strategy to maximize the benefits it receives from Chabahar.

https://thediplomat.com/2018/01/india-lacks-a-competitive-trade-strategy-for-chabahar/

The first shipment to pass through the port of Chabahar to Afghanistan was celebrated with much fanfare and excitement this late October. India, with the largest economy in South Asia and an ever-rising military footprint has much to be proud of regarding this development. In the face of regional tensions with its western neighbor, Pakistan, India has chosen to circumvent the nation in order to open new trade routes with Afghanistan and greater Central Asia. Delhi may now find it easier to further diversify its trading partners, strengthen its relations with regional neighbors, and simultaneously compete with China’s Belt and Road Initiative.

While the potential for Chabahar’s positive externalities remain numerous, they also remain largely hypothetical. The completion of the project does not necessarily guarantee an increase in Indian economic influence, considering the economic and political realities that Delhi presently faces on the domestic front and in the region. The competitiveness of Indian exports, the security situation in Afghanistan, and regional geopolitics pose several hurdles that India must overcome.

Domestically, India faces a slowing economy that has had six continuous quarters of decreasing growth. The economy rebounded in the latest quarter but growth forecasts for the economy continue to be revised downwards due to recent poorly executed economic reforms (the Goods and Services Tax and demonetization). This becomes further troubling as the Indian economy continues to be faced with a critical job shortage that must incorporate 12 million young people every year. Additionally, India’s banking sector continues to pose risks to the economy with non-performing assets (bad loans) continuing to rise to unprecedented levels. In light of domestic economic challenges, Delhi would be wise to draft a comprehensive economic strategy to justify the cost of the overall investment in Chabahar and the overall multinational initiative.

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Currently, India has allocated around $2 billion to the overall project — $500 million dollars has been allocated to the construction of Chabahar port to increase cargo handling capacity and $1.6 billion to the construction of a rail link that will connect the port to the city of Zahedan. The city borders Afghanistan and will allow goods to flow into the country through already built infrastructure. Chabahar port will also serve as a starting point for the over-arching International North-South Trade Corridor (INTSC) that aims to connect India, Iran, Russia, and various Central Asian states. Remarks by Indian Prime Minister Narendra Modi and various analysts claim that the new port will revolutionize trade and commerce. This may prove to be true if India is able to drastically improve the efficiency of its manufacturing sector and increase the demand for Indian goods.

Yet, the current status quo will prove difficult to change considering both the cost and share of total exports India sends to Central Asia (including Afghanistan) when compared to other nations, specifically China. In early July, the Minister of State for Micro, Small, and Medium Enterprises, Haribhai Chaudhary, was asked why domestically produced goods cost more than those imported from China. Chaudhary responded, “The products manufactured in China are reportedly of lower price mainly because of their opaque subsidy regime and distorted factor prices.” India’s economy is primarily based on the services industry, which composes more than half of its GDP, compared to industry (including manufacturing), which only composes a little more than a quarter. China’s economy on the other hand, is primarily composed of industry, giving it greater leverage and ability to compete with Indian goods.

Riaz Haq said...

Once a struggling startup, now a success story
Technology
by Sarfraz Ali | Published on January 25, 2018 ��

The serial entrepreneur, mentor, co-author of “New Success Secrets”, “L.E.G Formula” and the founder of Global Social Entrepreneurship Foundation, Muhammad Siddique, compiled data on such projects, says the Momentum Tech Conference 2018 has even more opportunities for the enterprises from its last year’s edition. He says the enterprise world is ready to help the Pakistani entrepreneurs to say goodbye to their excuses. “This year, Fortune 500 mentors and representatives of world’s top online brands will be in Pakistan to help startups,” he said.

Of the long list of the online startups, there is the Nearpeer.org. This is an online professional courses portal where the users can learn at a self-directed pace. The startup won the second prize at the Momentum Tech Conference 2017. Its co-founder Ammar Ali Ayub who with his friend, tried to be a job provider while graduating from LUMS. Now, he has a team of 25 people and provides jobs to many dozen people. Ammar’s advice to startups is: never give up.

Ali Gohar Wassan is the co-founder of TheUniPedia, an online portal for universities entry test preparations with self-assessment, explanations and dedicated tutors to enhance the learning level of students. Ali Gohar is himself is a university dropout but he saw an opportunity in directing the people to the university education, and in the process now he provides jobs to hundreds of tutors and a full-time seven people team. Ask him about his secret to success, and smiles: have mentors, leave out excuses and be fair to yourself. He says meetups like Momentum Tech Conference are never to be missed. “It is the venue where from we got payment solutions and universities connections.

Also, at the conference will be Sehat.com.pk Marketing Director Bilal Mumtaz. His online medicine supply is a real breakthrough in Pakistan’s health system. The startup came into being when his project won a $150,000 seed money from a Canadian university, and since then the project has achieved many landmarks and has faced and overcome critical issues like fake medicine supplies. His priority is to provide cheap, good quality medicines to the people in rural areas at their doorstep in the quickest possible way. His secret success is: my network is my net-worth.

The online journey has brought Hyder Khan to Hyderabad from his hometown Badin. This under-30 startup star is running two projects: one, software development and two, accounting consultancy. Just one year ago, he had invested Rs5,000 in his online business and now, he has a team of six people for both businesses.

Qasim Asad Salam’s TheCampusFeed.com is also a new rage among the university students. The idea emerged when this LUMS student was in the final year and had been finding very hard to connect with other students. He thought of connecting with other students through a social network where everyone could speak on any issue maintaining anonymity. The idea was realized into a reality when it won a Rs300,000 prize at the Momentum Tech Conference 2017. That was a great push, and now the project is being run by six people. His advice to the struggling enterprises: be passionate, do not chase money and be extremely hardworking.

Last but not least stands Sameer Ahmed Khan whose application SocialChamp.io won the first prize at Momentum Tech Conference 2017. This application caters to need all social media users. His story and struggle are very inspirational. A spate of failures did not deter him from working again and again and at the end of the day, he met with success. Such success stories and connections are learned and earned at the events like Momentum Tech Conference. This year, the event is going to be held on February 19 and 20 in Karachi.

https://en.dailypakistan.com.pk/technology/once-a-struggling-startup-now-a-success-story/

Riaz Haq said...

Pakistan lowers electricity price by 2.99 rupees per unit
Source: Xinhua| 2018-01-25 22:07:15|Editor: Yurou

http://www.xinhuanet.com/english/2018-01/25/c_136924891.htm


ISLAMABAD, Jan. 25 (Xinhua) -- Pakistani National Electric Power Regulatory Authority (NEPRA) announced on Thursday to reduce the electricity price by 2.99 rupees (2.7 U.S. cents) per unit under the fuel adjustment for the month of December, 2017.

The decision in this regard was taken in a public hearing, which was conducted under Chairman NEPRA Tariq Saddozai in Islamabad. The hearing was conducted upon request of the Central Power Purchasing Agency (CPPA) which requested the NEPRA to cut the power price.

The CPPA informed at the hearing that the generation of electricity during December was recorded at 7.76 billion units, which was produced at 5.11 rupees (4.6 U.S. cents) per unit while its cumulative cost was 40.60 billion rupees (0.37 billion U.S. dollars).

The power distribution companies charged consumers 8.10 rupees (7.3 U.S. cents) per unit during the month under review, it added.

Riaz Haq said...

Pakistan: Chai at Midnight
Scenes of daily life in Pakistan rarely make the news; here are some glimpses.

By Robert Gerhardt
January 26, 2018

https://thediplomat.com/2018/01/pakistan-chai-at-midnight/

Pakistan has a mixed reputation in the eyes of many Americans (including the president, according to his tweets). When Pakistan is in the international news, it’s often for terrorism or sectarian violence. But while terrorist attacks do happen in the country — the people I met during a recent visit were open about that fact — the country is far from being a warzone.

During my travels, no matter where I went, or what time of day or night, every Pakistani I met was unbelievably welcoming to me. They would offer up bits of small talk and copious quantities of tea and snacks. They even put up with my bad attempts to speak Urdu, smiling and laughing as I tried to string together a few phrases.

Virtually every night my new friends and I went out for chai at a little market stall, usually around midnight when the heat broke — at least a bit. It got to the point that the locals and the Puthans who worked there stopped acting surprised to me see; they would smile and wave as we arrived.

As I traveled around the country, I photographed what I saw in front of me: the markets, streets, late-night chai stalls, drivers, motorbikes and street food vendors. It’s these people going about their routines that make up the daily life of a country many never see.

Robert Gerhardt is a social documentary photographer based in New York City. His work has appeared in The New York Times, The Guardian, Süddeutsche Zeitung, Hindustan Times, and Newsweek among others. Robert’s projects can be seen on his website: www.RobertGerhardt.com

Riaz Haq said...

#BMI Research in World Economic Forum (#WEF18) report says #Pakistan among top 10 drivers of global #economic growth as "manufacturing hub". Others in top 10: #Bangladesh #Egypt #Indonesia #Nigeria #Ethiopia #Kenya https://www.weforum.org/agenda/2016/07/these-are-the-10-emerging-markets-of-the-future


"Pakistan will develop as a manufacturing hub over the coming years, with the textile and automotive sectors posting the fastest growth at the beginning of our forecast period. Domestic manufacturing investment will be boosted by the windfall from lower energy prices compared to the last decade, and improved domestic energy supply."



A new report from BMI Research has identified the "10 emerging markets of the future" — the countries that are set to become new drivers of economic growth over the next 10 years.

BMI estimates that these countries will cumulatively add $4.3 trillion to global GDP by 2025 — roughly the equivalent of Japan's current economy.

In general, manufacturing and construction are the sectors that will drive the economies. BMI reports that new manufacturing hubs are set to emerge in Bangladesh, Myanmar, and Pakistan, and that these countries will see particularly strong growth in exporting manufacturing industries. And construction growth is going to be widespread throughout all the countries — partly to facilitate increases in urban populations and partly to help develop the manufacturing sector.

On the other hand, extractive industries — like mining, oil, and gas — are going to play a far smaller role in driving growth than they have the past 15 years.

While it might provide bright spots for some countries, the report states, "the ubiquitous commodity-driven growth model that was derailed by the 2012-2015 collapse in commodity prices is not coming back."

Riaz Haq said...

5 airlines to venture into Pakistan
Source: Xinhua| 2018-01-29 20:13:38|Editor: Lifang

http://www.xinhuanet.com/english/2018-01/29/c_136934060.htm

ISLAMABAD, Jan. 29 (Xinhua) -- Five national and international airlines have applied for regular public transport airline license of Pakistan Civil Aviation Authority (CAA) to venture into the country's aviation industry, local reports said Monday.

The airlines are expected to get permission to carry out the flight operation in the country's skies during the next one year, which is likely to bring down passenger fares, local newspaper Express Tribune said.

Airlines including Askari Air, Air Siyal, Go Green, Liberty Air and Afeef Zara Airways have applied for the license to be a part of the aviation industry which is expected to be around 9 percent per annum and likely to keep the same pace till 2020, according to a forecast of the International Air Transport Association, a trade body of world's airlines.

Pakistan's air traffic has soared up to 40 percent over the past five years to 20 million passengers, and is continuously witnessing an upward trend due to improvement of law and order situation in the country, which is bringing in more tourists in the country.

The China-Pakistan Economic Corridor (CPEC) has also resulted in the increase of air traffic in the country.

Most of the upcoming carriers will target low-profit, far-off destinations including Gwadar, Turbat, Panjgur, Khuzdar, Dalbandin, Zhob, in Balochistan province where CPEC projects are in full swing, and the tourist destinations of Rawalakot, Skardu, Chitral, Gilgit, Bannu and Parachinar.

The destinations could generate immediate profits because of their tourism potential and work on CPEC projects.

For these remote regions, the new carriers will bring airplanes suitable for small airports.

The entry of new airlines in the country's airspace is expected to further increase challenges of the country's national flag carrier Pakistan International Airlines, which was the sole operator in most of these routes in the past.

Riaz Haq said...

Two-time #Grammy wining #American DJ and #music producer Diplo brings his Mad Decent Block Party to #Pakistan's capital #Islamabad over the weekend, headlining a roster of musicians including local #Pakistani acts. #SNKM

http://www.todayonline.com/world/pakistan-gets-dash-music-diplo-macy

For two-time Grammy winner Diplo, playing Pakistan is a way to foster good relations with the mostly Muslim country after an angry Jan. 1 tweet from U.S. President Donald Trump complaining that Pakistan gives "terrorists" a safe haven.

"I think the best way we can do any kind of diplomacy with the Pakistani people is ... basically reaching out to the kids like we do at the concerts," Diplo told TMZ last month after the Trump tweet, which soured U.S.-Pakistani relations.

He added that by having U.S. acts connect with the large youth population - an estimated 60 percent of Pakistanis are under age 30 - "they can grow into being our allies".

More than 2,500 young people crowded into an outdoor venue in the capital, Islamabad, to a scaled down version of the event known for bringing together some of the hottest names in dance-hall, hip hop and electronic music.

Among the headliners were Diplo's chart-topping side project Major Lazer Soundsystem, DJ Chrome Sparks and Pakistani duo SNKM, which has played the South by Southwest festival and toured with Diplo in the U.S.

"There's a lot of bridges being built between here and the U.S." says SNKM's Adil Omar, who also has a successful hip hop career and a new album and film "Transcendence" to be released this year. REUTERS

Riaz Haq said...

A future perfect
Stephen Pinker’s case for optimism
“Enlightenment Now” explains why the doom-mongers are wrong

https://www.economist.com/news/books-and-arts/21737241-enlightenment-now-explains-why-doom-mongers-are-wrong-stephen-pinkers-case

TO ANYONE who reads a newspaper, this can seem a miserable world. Syria is still at war. Another lunatic has gone on a gun rampage in an American school. The tone of political debate can rarely have been as crass and poisonous as it is today.

Front pages are grim for the same reason that Shakespeare’s plays feature a lot of murders. Tragedy is dramatic. Hardly anyone would read a story headlined “100,000 AEROPLANES DIDN’T CRASH YESTERDAY”. Bad things often happen suddenly and telegenically. A factory closes; an apartment block burns down. Good things tend to happen incrementally, and across a wide area, making them much harder to film. News outlets could have honestly reported that the “NUMBER OF PEOPLE IN EXTREME POVERTY FELL BY 137,000 SINCE YESTERDAY” every day for 25 years. But readers might get bored.

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The world is about 100 times wealthier than 200 years ago and, contrary to popular belief, its wealth is more evenly distributed. The share of people killed annually in wars is less than a quarter of that in the 1980s and half a percent of the toll in the second world war. During the 20th century Americans became 96% less likely to die in a car crash, 92% less likely to perish in a fire and 95% less likely to expire on the job.

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Best of all possible worlds

Progress has often been stunningly rapid. The vast majority of poor Americans enjoy luxuries unavailable to the Vanderbilts and Astors of 150 years ago, such as electricity, air-conditioning and colour televisions. Street hawkers in South Sudan have better mobile phones than the brick that Gordon Gekko, a fictional tycoon, flaunted in “Wall Street” in 1987. It is not just that better medicine and sanitation allow people to live longer, healthier lives, or that labour-saving devices have given people more free time, or that Amazon and Apple offer a dazzling variety of entertainment to fill it. People are also growing more intelligent, and more humane.

In every part of the world IQ scores have been rising, by a whopping 30 points in 100 years, meaning that the average person today scores better than 98% of people a century ago. How can this be, given that intelligence is highly heritable, and clever folk breed no more prolifically than less gifted ones? The answer is better nutrition (“brains are greedy organs”) and more stimulation. Children are far likelier to go to school than they were in 1900, while “outside the schoolhouse, analytic thinking is encouraged by a culture that trades in visual symbols (subway maps, digital displays), analytic tools (spreadsheets, stock reports) and academic concepts that trickle down into common parlance (supply and demand, on average, human rights).”

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Belief in equality for ethnic minorities and gay people has shot up, as demonstrated not only by polls (which could be biased by the knowledge that bigotry is frowned upon) but also by internet activity. Searches for racist jokes have fallen by seven-eighths in America since 2004. Those who enjoy them are dying out: online searches for racial epithets correlate with interest in “Social Security” and “Frank Sinatra”, Mr Pinker notes. Even the most conservative places are loosening up. Polls find that young Muslims in the Middle East are about as liberal as young western Europeans were in the early 1960s.

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Mr Pinker has answers for all these questions. In 45 out of 52 countries in the World Values Survey, happiness increased between 1981 and 2007. It rises roughly in line with absolute income per head, not relative income. Loneliness, at least among American students, appears to be declining. Global warming is a big threat, but not insurmountable. The number of nuclear weapons in the world has fallen by 85% since its peak.

Riaz Haq said...

The Virtue of Radical Honesty
David Brooks
David Brooks FEB. 22, 2018

https://www.nytimes.com/2018/02/22/opinion/steven-pinker-radical-honesty.html

This week I asked a group of students at the University of Chicago a question I’m asking students around the country: Who are your heroes? There’s always a long pause after I ask. But eventually one of the students suggested Steven Pinker. Another chimed in Jonathan Haidt. There was general nodding around the table.

That was interesting. Both men are psychology professors, at Harvard and N.Y.U., who bravely stand against what can be the smothering orthodoxy that inhibits thought on campus, but not from the familiar conservative position.

One way Pinker does it is by refusing to be pessimistic. There is a mood across America, but especially on campus, that in order to show how aware of social injustice you are, you have to go around in a perpetual state of indignation, negativity and righteous rage. Pinker refuses to do this. In his new book, “Enlightenment Now,” he argues that this pose is dishonest toward the facts.

For example, we’re all aware of the gloomy statistics around wage stagnation and income inequality, but Pinker contends that we should not be nostalgic for the economy of the 1950s, when jobs were plentiful and unions strong. A third of American children lived in poverty. Sixty percent of seniors had incomes below $1,000 a year. Only half the population had any savings in the bank at all.

Between 1979 and 2014, meanwhile, the percentage of poor Americans dropped to 20 percent from 24 percent. The percentage of lower-middle-class Americans dropped to 17 from 24. The percentage of Americans who were upper middle class (earning $100,000 to $350,000) shot upward to 30 percent from 13 percent.

There’s a fair bit of social mobility. Half of all Americans wind up in the top 10 percent of earners at at least one point in their career. One in nine spend some time in the top 1 percent.

Poverty has been transformed by falling prices and government support. “When poverty is defined in terms of what people consume rather than what they earn, we find that the American poverty rate has declined by 90 percent since 1960,” Pinker writes.

America has a pretty big safety net. Our numbers look bad because so much of our health care spending is funneled through employers, but when you add this private social spending to state social spending, America has the second-highest level of such spending of the 35 nations in the Organization for Economic Cooperation and Development, after France.

Pinker has data like this in sphere after sphere, marking the progress we’ve made in health, the environment, safety, knowledge and overall happiness. So is he right, that society is in much better shape than we’re allowing?

Riaz Haq said...

Credit take-off, remittances set to lift Pakistan economy
M. Aftab
Analysis/Islamabad
Filed on February 24, 2018 | Last updated on February 24, 2018 at 06.43 pm

https://www.khaleejtimes.com/business/economy/credit-take-off-remittances-set-to-lift-pakistan-economy

Rising credit off-take of commercial banks indicates a significant growth of the economy, while a major campaign has been launched to ensure a fast track service for home remittances. This is confirmed in the Banks Lending Survey (BLS) just unveiled by State Bank of Pakistan (SBP), the central bank. The survey conducted during second quarter of financial year 2017-18.

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SBP's 'good-business' report said after receiving the feedback from senior bankers of 18 banks, the central bank identifies two main factors supporting the expansion in the credit demand. These factors include 'the need of firms for building up their inventories and working capital' and 'improved economic conditions'.

"Increase in fixed investment and seasonal increase in credit demand are two other factors," it further said.

The overseas Pakistanis sent home $11.4 billion remittances during the first 7 months of 2017-18, the SBP reported.

The inflow was 3.55 per cent higher than the like period of 2016-17. The SBP data showed that the inflow was significantly high from US, UK and EU. The remittances from Saudi Arabia at $2.914 billion were the highest, followed by the UAE with $2.512 billion and rest of the GCC countries with $1.314 billion. The remittances from UK totalled $1.585 billion followed by US $1.504 billion and EU $371 million.

In order to help the overseas Pakistani and their families back home, the government of Pakistan and the Sate Bank of Pakistan are pushing the commercial banks to reduce their handling charges to encourage the remittances inflow.

"We are urging all the commercial banks to improve their system for timely payments of remittances into the accounts of recipients," said Jamil Ahmed, deputy governor of SBP.

"We are doing our best to encourage the overseas Pakistanis so that they can transfer their money through official channels instead of 'hundi' and 'hawala'," he added.

Jamil made these remarks at the launch of a documentary film called 'hundi to kundi lagao' (Lock up the hundi), prepared by National Bank of Pakistan. It was a part of the bank's awareness campaign to encourage overseas Pakistanis to use official banking channels for remittances.

Jamil advised the bankers to use social media for marketing services. He said the amount sent by overseas Pakistanis through official channels rose 16 per cent between 2009 and 2017, making Pakistan. It is indeed heartening to note that the focused efforts of all stakeholders resulted in an increase of 13.2 per cent during the first two months of 2017-18 as against a fall of 3.1 per cent in 2016-17.

"Now there is a need to maintain this momentum and a positive growth trajectory in the coming months," he said, adding that the "focused area of inflow of remittances are the UAE, Saudi Arabia and other Gulf countries, which contribute 87 per cent to the remittances we receive."

Seed Ahmed, president of National Bank of Pakistan, speaking on the occasion said Pakistan is facing the challenge of balance of payment deficit and to meet this challenge the remittances play an important role.

"Inflow of remittances can be much improved if banks adopt the system of the fastest payment of remittances to the recipients," he said, adding that the idea behind making this movie is to urge the people that whatever money is coming into Pakistan, it should be routed through legal channels.

"Banks will serve the customers with an exceptional efficiency."

The banking industry is now doing its utmost to help the overseas Pakistanis with transfer of their remittances through fast track legal channels. That is a good news.

Riaz Haq said...

Egyptian Billionaire Eyes Further #Pakistan #RealEstate Projects - Bloomberg #Islamabad #housing


https://www.bloomberg.com/news/articles/2018-03-06/egyptian-billionaire-eyes-further-pakistan-real-estate-projects

Naquib Sawiris is developing a $2b estate in Islamabad
Pakistan faces a housing shortage as its population expands

Egyptian billionaire Naguib Sawiris’s Ora Developers will next month start building a luxurious $2 billion housing estate on the outskirts of Islamabad and is eyeing further projects as it taps demand from overseas Pakistanis.

The ‘Eighteen Islamabad’ development will feature more than 1,000 homes, a golf course and a mall on 2.25 million square meters of land. It will take six years to complete, said Tarek Hamdy, chief executive officer of the development. Sawiris holds 60 percent in a joint venture with local firms Kohistan Builders and Developers and Saif Group, owned by Pakistan’s prominent Saifullah family.

Pakistan’s real estate sector has seen a boom in recent years as militant violence has receded. Economic growth in the nation of more than 200 million people has risen to around 5 percent as China finances more than $50 billion on infrastructure projects across the country. House prices have more than doubled since 2011, according to property website Zameen.com, and housing projects are mushrooming in cities such as Karachi, Lahore, Islamabad and Peshawar,

“The market isn’t saturated,” Hamdy said in an interview at his office next to Islamabad’s Margalla hills, adding that Sawiris’s firm is eyeing potential other projects that may be announced by the end of this year.

Prices for a three bedroom home on the estate start at 30.5 million rupees ($275,395) and about $400 million will be invested in the development in the first two years, Hamdy said.

‘Highest Quality’
“You can develop a project at very reasonable margins” between 10 to 40 percent, he said. “The highest quality still makes money.”

Sawiris is not new to Pakistan. He previously set up one of Pakistan’s first mobile phone companies, Mobilink, now the nation’s largest cellular firm by subscriber numbers.

Apart from private businessmen such as Malik Riaz Hussain who is building Pakistan’s largest development outside Karachi, the military’s housing business has sped up efforts to grab market share. Hamdy sees overseas Pakistanis particularly in the U.S., U.K. and Middle East as major buyers and is considering launching another housing project by the end of 2018.

A shortage of housing units will boost construction activity in Pakistan as the urban population grows by nearly 30 million by 2027, BMI Research said in a December report. Construction has been one of the largest recipients of foreign direct investment and in the first seven months of this fiscal year $380 million was invested in the sector, according to central bank data.