KARACHI: The Pakistan Business Council (PBC) welcomes the establishment of the EAC and looks forward to working with it in the interest of Pakistan’s inclusive and sustainable growth.
According to a letter written to Prime Minister Shahbaz Sharif, the PBC said it is a research-based pan-sectoral advocacy body composed of the country’s most prominent long-term investors, both local and multinational. Unlike trade associations, we do not promote interests of any single sector. Nor do we have a country-of-origin bias. Our research and evidence-based advocacy is for the greater good of the country. We have published over 100 research reports which are available on our website: www.pbc.org.pk.
In reviewing the Terms of Reference (ToR) of the EAC we noticed that development of a common Charter of Economy is missing. PBC believes that fundamental reforms cannot be implemented without cross-party consensus on the economy. Also, without a sound economy, public welfare objectives cannot be achieved. As the leader of a multi-party coalition, you are in a unique position to at least bring the coalition on a common platform. PBC has developed a framework for the Charter which is available on the link: Charter of Economy.
Another critical aspect of the economy which is not explicitly covered in the ToR is agronomy. Agriculture output is critical for food security and it also has significant impact on the current account and inflation. We recommend that this sector, which is also a major source of employment and rural welfare be represented in the EAC.
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The EAC has leading business leaders from the private sector who have valuable insight on the economy. However, we noted that there is no representation of the IT/IT-enabled services, start-ups and the telecommunications sectors. These are businesses of the future and their recommendations would be valuable in future-proofing the economy.
PBC’s over-arching theme is “Make-in-Pakistan” with the objective of creating jobs, promoting value- added exports and encouraging import substitution on a sustainable and competitive basis. We note from the TOR that protection and subsidies to SOEs & industries are to be addressed. “We welcome this as we do not support open-ended indefinite protection beyond offsetting Pakistan’s cost of doing business and which works against the long-term public interest.”
The ToR does not cover exports explicitly. Nor does the EAC include the Ministers of Commerce or Industries. Pakistan’s major challenge is to grow and diversify its exports. “We recommend that the Ministers of Commerce and Industries are included in the EAC. This would also be useful in the analysis of cost and benefit of import protection as the National Tariff Commission falls under Commerce. The PBC’s recommendations on a national charter for exports are available on: Charter for Exports. We also have recommendations on reindustrializing the country on: Contours of a New Industrial Policy.
The country faces significant economic challenges. As an interim government, your urgent attention will no doubt be on restoring fiscal prudence. We hope that through the EAC you will also have an opportunity to begin some of the fundamental reforms in energy, broadening the tax base, addressing state owned enterprise losses and privatization, improving public debt management and dealing with the growing pension liability - even if it is to agree a direction through a Charter of Economy.
Copyright Business Recorder, 2022