For an organisation that has been out of the scene for a long many years, the Employers’ Federation Pakistan (EFP) has lately been busy. Earlier this year, the body formed in 1950 to protect and promote the interests of employers through participation at national and international level, played a pivotal role in the drafting and passing of Sindh’s first labour policy. This week it announced a much bigger agenda: Economic Vision 2030.
From the looks of it, it is difficult to argue with most of the items proposed in EFP’s vision. Reduction in GST and corporate tax rates; implementation of FRDL Act; rationalization of government expenditure; attract FDI; fixing of administrative and procedural irritants; human resource development; cheap uninterrupted energy; focusing on new sectoral policies and so forth. All these and many other items of EFP’s economic vision are worthy of the prayer ‘good luck and God speed’; albeit the document also ought to expand to provincial economies. Since the devolution, the public services that businesses need for their day to day operations lie in the provincial domain whereas a host of economic sectors also lie squarely in their domain.
How does the EFP plan to help Pakistan achieve this vision is a question that the body plans to answer in due course when it finalises the supplementary modules of this vision, which it eventually intends to share with various stakeholders of the society. The EFP’s document says it is “ready to share the details with the media, policymakers, statesmen, and political parties”. (Note: the absence of business stakeholders from this list).
Another key question is whether the EFP will be able to bell the cat, considering that a host of other stakeholders including chambers/associations, think tanks, and Pakistan Business Council (PBC) have also been trying to get governance going in the country.
At the press moot on Monday, the EFP maintained it is best positioned to do so because it says, “it is the largest body that represents the private sector nationwide”. It argues, and rightly so, that chambers and associations have been clouded with trading-mindset because these bodies are dominated by traders, whereas the EFP wants Pakistan to kick start industrialization on “war footing”. That’s an agenda it shares with the PBC, which has also been vocal about manufacturing in Pakistan. (See also ‘Empty Chambers?’ Published 19th Jan, 2016).
But whether the EFP shares PBC’s view on protecting the infant industry, or whether it supports outright across the board tariff liberalisation, as is advocated by the likes of the Islamabad-based think tank Prime Institute, is not clear from the vision document.
BR Research raised this question at EFP press moot. Their panel economist Dr. Ayub Mehar, responded by maintaining that the EFP supports tariff liberalisation, but with exceptions for those sectors that could become efficient producers within what he called the WTO approved time frame of 6 to 36 months by lowering the cost of business. This puts the EFP close to PBC’s position that had also demanded protection for a limited period of time.
Faced against a largely trader vote bank that has the power to shut down shutters across the country (remember VAT saga), the EFP and the PBC should consider joining hands on this manufacturing agenda. The constituency for reforms in this country is already weak; businesses stakeholders vying for some form of Charter of Economy will need to find strength in numbers. (See also ‘Finding the constituency for ‘Make-in-Pakistan’, Published 19, Jan, 2018 & ‘Is the PBC demanding protectionism?’ Published 26, Jan, 2018).
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