In conjunction with the World Islamic Economic Forum held in Kuala Lumpur last week, Pakistani Prime Minister Yusuf Raza Gilani talks about the current situation in his country, which has been plagued with terrorism in recent years, and the potential for investment and development.
Q: What did Pakistan hoped to achieve at WIEF 2010?
A: This forum is the premier platform for exploring opportunities in Islamic countries, including an excellent opportunity for informal business interaction, networking, and regional consultation. It offered the opportunity of identifying and developing new partnerships in energy, agriculture, industry, trade and services and will contribute to the evolution of the global, economic and social agenda.
The forum helped evolve strategies for creating a better understanding of business opportunities in emerging markets, integration with the global economy, participation in the global supply chain and harnessing modern technologies for the mutual advantage of Islamic countries.
Q: Are you satisfied with Pakistan’s role in WIEF and how can WIEF be improved to enable it to effectively respond to the aspirations and needs of its members?
A: Pakistan has played an active role in WIEF, starting from its inception, and hopes to continue to enlarge this role in future. We should evolve an effective dispute resolution mechanism to resolve our issues and problems and put in place a sound framework for mutual cooperation. We must promote unity among and within our countries. We should broaden and deepen our economic relations. With a growing population and depleting resources in the world, such intra-Islamic cooperation is becoming increasingly important for ensuring our energy security, water security and food security.
We must undertake necessary political, economic and social reforms to create an enabling environment to harness our individual and collective potential. For this, we need to ensure political stability and continuity, good governance, transparency and accountability as well as consistent economic policies and improved delivery of social services, especially in health and education.
We should focus on education and catch up in the field of science and technology. Skill development through vocational training should receive high priority to equip our growing workforce with capabilities which are in demand in national and international markets.
We must evolve a comprehensive growth model to provide a strategy for balanced development. More-over, we should provide for sharing of financial and commodity surpluses through institutional mechanisms driven by public-private partnerships.
Q: How do you evaluate Malaysia’s role in WIEF?
A: Malaysia’s contribution in establishing WIEF has been very significant and defining. Since its inaugural session in October, 2005, Malaysia’s efforts have been aimed at turning WIEF into a platform for dialogue and exchange of cross-cutting ideas, and business networking between governments and business leaders across the Muslim world and beyond.
Beyond the event, the WIEF Foundation has also spearheaded the development of several important initiatives, such as WIEF Businesswomen Network, WIEF Education Trust and WIEF Young Leaders Network. Malaysia’s contribution in these spheres is laudable.
Q: What are the key areas of Pakistan-Malaysia cooperation?
A: I understand that a vast scope exists for trade and investment between these two brotherly countries. Pakistan is deficient in edible oil production and can benefit from the rich Malaysian experience in palm plantation. Malaysia can render technical assistance and also come forward for investment in palm plantation projects and canned food industry. Electricity generation and particularly electricity generation from coal will be the focal areas. Pakistan has made strides in the area of defence production, which serves as an area where Malaysia can join hands both for trade and investment.
In addition, greater investment and trade cooperation can occur in electronics, bio-technology, light engineering and financial services.
Q: One of the main themes of WIEF 2010 is Islamic banking, finance and entrepreneurship. Do you foresee banking and financial institutions of Pakistan and Malaysia forging closer cooperation in this area?
A: The recent international financial crisis was primarily related with banking and non-banking financial institutions. Financial institutions of various countries were more affected by the crisis proportional to the extent of their integration with the international financial system. Yet no financial set-up of a country can stay in isolation.
I understand both Pakistan and Malaysian financial institutions can share their experience in this regard to forestall and hedge any such future situation. Pakistan can benefit from the practical manifestation of the Islamic banking system in Malaysia for its replication in Pakistani conditions.
Already, significant investments have been made in Pakistan’s financial sector by one of Malaysia’s biggest banks, Maybank. We look forward to more such partnerships.
Q: What is Pakistan’s commitment to climate sustainability? Are there policies in place that would encourage investors, including Malaysian and other foreign investors to go “green” when investing in Pakistan?
A: Pakistan is a very low-level GHG (Green House Gas) emitter and an insignificant contributor to total global GHG emissions, yet it faces challenges like any other developing country and needs large increases in energy supplies to fuel its much needed socio-economic development. As a responsible member of the world community, Pakistan intends to check its future GHG emission.
The government of Pakistan is committed to ensuring climate sustainability and has taken a number of initiatives for the purpose, such as a National Operational Policy for Clean Development Mechanism (CDM) which was approved in February 2006. Under this strategy, all types of unilateral, bilateral and multilateral CDM projects are eligible in areas of energy, land use, forestry, agriculture and livestock, waste management, transportation and industrial processes.
Pakistan, via the Ministry of Environment, has taken a number of initiatives to promote CDM project activities and has so far granted approval to 23 CDM projects. The expected benefits in the form of Foreign Direct Investment from these approved projects is US$719.39mil and GHGs 3.83 million tons CO2 eq/year. And 110 CDM projects are in the pipeline in the country. The implementation of the total 133 CDM projects would provide a FDI of US$2.29bil and 30.02 tons CO2 eq/year.
Q: Malaysian companies have been keen to invest in Pakistan. Renexus plans to develop a US$500mil water treatment plant, and another company wants to construct low-cost housing in Pakistan. Is there any progress on these interests?
A: Renexus has offered to invest US$500mil to build water treatment plants at various locations in Pakistan, especially in the province of Punjab aimed at providing potable water for public as well as industrial use.
According to the proposal, Renexus will arrange all the required funding on a build-own-and-operate (BOO) basis. Their plants will sell the water bulk to government-related agencies, which in turn, would effect the distribution to end-users and collect utility charges.
The proposal is presently being studied by the Economic Affairs Division. We hope this would be another milestone in our mutually beneficial cooperation with Malaysian investors. Renexus has also expressed interest in constructing low-cost housing units in Pakistan.
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