A novel approach to FDI statistics

The federal government is said to have taken a novel approach to foreign direct investment (FDI) statistics by including capital imports in its calculation, sources in Board of Investment exclusively told Business Recorder. They said that the BoI will reportedly include the purchase of a new Airblue aircraft worth $60 million as FDI.
The aircraft was finally released from Toulouse, France, after BoI got involved in the dispute between AirBlue and the French supplier. This involvement of BoI justifies placing the cost of the plane as FDI, they added. FDI declined in 2010 by 33 percent against 44 percent decline in investment observed globally, sources said.
An official of BoI said that no privatisation proceeds materialised during last three years. This accounts for a decline in FDI. The Privatisation Commission argues that its failure to privatise state owned entities is attributable to global recession as well as domestic stagflation fuelled by energy shortages and law and order. Unless the situation stabilises, PC will not be able to attract investors to participate in the government''s privatisation programme.
First five months of the current fiscal year saw a replacement of the previous largest single FDI source, the USA, by the UAE. The Emirates invested $102 million in the first five months, which is about 17.8 percent of the total FDI this year. The UK was the second largest investor with $95.1 million representing 16.6 percent of total FDI size. The USA was the third largest investing country with $91 million or 15.9 percent of the total investment. With an investment of $86.4 million, Hong Kong was the fourth largest investor accounting for 15.1 percent share in total foreign investment. Singapore and Cayman Islands remained fourth and fifth largest investors with $23.3 million and $18.4 million, respectively. The FDI inflow from all other countries stood at $156.8 million, which is 27.2 percent of the total FDI.
The government failed to bridge the energy deficit in the country. The first five month of current year showed more FDI in oil and gas and telecommunication sectors than power sector. Total investment in the oil and gas exploration stood at $169.9 million in the first five months of the current fiscal year, that is, 29.6 percent of total FDI size. Telecommunication attracted investment of $82.3 million that is 14.4 percent of total FDI. The FDI stood at $51.1 million in the power sector, that is 8.9 percent.