Pak-China Investment Company launched

Caretaker Federal Finance Minister Dr Salman Shah has said that China and Pakistan have decided to increase volume of trade from the existing $5 billion to $15 billion in the next five years. He was speaking at the launch of Pak-China Investment Company Limited (PCICL) held at the Governor''s House on Monday.
The initial authorised capital of the Company is Rs 12.14 billion or equivalent to $200 million, making it the largest joint venture Investment Company in the country. The Company has become operational with an initial paid-up capital of $70 million to increase to $200 million by 2009. Both the sponsors are contributing equally to the capital. It is a joint venture between the China Development Bank and the Finance Ministry, Government of Pakistan. This is the first venture of its type by the China Development Bank outside China.
Dr Salman Shah said that Pak-China Investment Company has challenges, but the biggest one is to achieve the target of trade volume set at $15 billion. He said that the progress of this ambitious public-private joint venture would be assessed on the basis of achieving the trade volume target and the number of new investments it brings to Pakistan.
"The measure of success of the Company would not be its earning on equity, but it will also be in terms of number of new investment and new projects that have taken place," he added.
The minister said that an increase of $3 billion in trade volume each year is not a big target given the resources and potential of business in the region. The two countries know the areas where there is room for improvement, and "I hope they will explore the possibilities of exploiting these areas."
He said that infrastructure development is one area, which Pakistan is worried about. The investment in this area would be welcome. If there is investment and infrastructure development takes place, a large number of business avenues would open for both the countries.
He said Pakistan is well placed geographically and it can provide access to Far East, South East Asian countries and the Central Asian Republics. He said that long-term investment in infrastructure development would accelerate business activities in Pakistan, and it would be in the interest of China as well.
Dr Shah said that global market is attracted toward China and once the fundamentals of greater economic foundations are laid, success would come. Pakistan in this context is opportunity investment area. All investments that come here should generate jobs, increase employment opportunity, encourage human resource development, and create efficient business practices for others to emulate. It will give more confidence to the people in business with Chinese firms.
He said that it is for the first time that such a venture has its chief executive other than a native. "We wanted a Chinese to head this organisation and Pakistani as his deputy. The Pakistani official is the window of the company."
Dr Shah recalled the history of Pak-China friendship, and expressed the hope that the friendship will further grow and strengthen with the passage of time.
He said "We are time tested friends and we would remain as such." State Bank of Pakistan (SBP) Governor Dr Shamshad Akhtar said in her brief remarks that the joint venture will enhance Pakistan''s finance landscape.
She said that the free trade agreement between China and Pakistan has given boost to trade between the two countries. With the setting up Pakistan China Investment Company she sees trade between the two countries to increase manifold.
She said that in her opinion the company should concentrate on long-term financing and infrastructure-related projects. "Pakistan and China have signed MoU in respect of banking activities and the commercial banks are well placed to materialise the objectives of this MoU. But, in the instant case, instead of commercial interest, the PCICL should focus on long-term financing in infrastructure projects development. They should involve themselves in long-term goals."
PCICL Vice Chairman and Managing Director Chen Jianbo, while welcoming the guest, said that the Company would be one step forward in developing economic co-operation between Pakistan and China. "The Company is a process of economic co-operation between the two countries", he added.
He said: "Pakistan is an advantageous geographical location, Central Asian countries are on the one side and on the other there is Gulf region, whereas Far East is also easily approachable. In Pakistan, quality workforce is available, Pakistan has a growing economy, its policy is encouraging, and the capital market is lucrative."
He said that with these reasons investment in Pakistan is worthwhile. "Pakistan is an attractive market for investment", Chen added. Sindh Governor Dr Ishratul Ibad Khan, Counsel General of China based in Karachi and Deputy Managing Director Seed Iqbal Ashraf also spoke on the occasion.
Board of Investment (BoI) Director-General Arif Elahi conducted the proceedings of the programme. The business community, banking, and corporate sectors'' representatives and elite of the city attended the launch.