MoI to negotiate revised BIT with Germany

The Ministry of Investment is to negotiate ''revised'' Bilateral Investment Treaty (BIT) with Germany and an agreement on promotion of and protection of investment in Zimbabwe, official sources told Business Recorder. Sources said that first BIT of the world was signed between Pakistan and Germany after Second World War on November 25, 1959.
The German government has requested the GoP to replace the old treaty with a new ''bilateral promotion and protection of the investment treaty''. "The two sides have exchanged their drafts. However, the negotiations need to commence. The draft has been shared with all stakeholders, and comments are being gathered to firm up Pakistan''s position," sources said.
According to sources, to commemorate the 50th anniversary of the first ever bilateral treaty in the world, the German government desires to organise a mega event in December this year, wherein important leaders, investors and other dignitaries will be invited.
Germany has been supportive of Pakistan''s efforts for enhanced market access in the EU. On the issue of Pak-EU FTA, German Chancellor Angela Merkel in her capacity as President of the EU in a letter to the Prime Minister proposed that the EU "would like to strengthen its relationship with Pakistan within the framework of a comprehensive dialogue through the joint commission and a working group for trade."
Besides the economic importance, politically, the German government has supported Pakistan on a number of important issues and considers Pakistan as its important partner in the region, sources added. In force, between Pakistan and Germany, are bilateral agreements on air transport, investment promotion, avoidance of double taxation and technical co-operation (as amended by annual arrangements on financial and technical cooperation).
The German government has approached the GoP for concluding the new BIT by replacing the old one. Pakistan''s Ambassador in Germany has also supported the proposal, sources said. "Ministry hopes that the Prime Minister will allow it to initiate negotiations with Germany within a couple of days," sources said.
With regard to Zimbabwe, sources said that Pakistan''s Mission to Harare has proposed that a BIT should be signed with Zimbabwe, as this would provide protection to Pakistan''s investors who have invested around $16 million in areas like steel making, flour mills, food processing and cold storage in Zimbabwe.
There are currently more than 2500 BITs in force world-wide, involving most countries. As international competition is gaining momentum to attract foreign direct investment (FDI); BITs are seen as instruments to gain investor confidence. Pakistan has concluded BITs with 47 countries of the world. "Entering into negotiations on BIT to promote and protect investment with Zimbabwe will not only help Pakistanis doing business there but would also make Pakistan visible in unexplored African market," sources argued.