Lars-Gunnar Wigemark, EU ambassador to Pakistan, on Wednesday expressed the hope that the incoming government will strengthen Competition Commission of Pakistan (CCP) to get rid of cartels, price-fixing, distorting subsidies and kick-backs, which are hampering both domestic economic growth and inflow of foreign investment and trade.
Speaking at the 3rd International Conference 2013 on 'Role of Competition in Fostering Trade and Investment,' organised by CCP, Wigemark said that the incoming government should create a truly level playing field for businesses in Pakistan. He suggested the incoming government to enhance trade and business with India and implement the competition laws in country to improve economic conditions.
"The new government has a set of competition laws but they need to be enforced, he said, adding the new government has a strong political mandate which should be used to get rid of cartels. "Make CCP as strong as the Election Commission of Pakistan...give it more resources and use its professional staff to the fullest. Improved competition is a win-win governance issue, which will benefit Pakistan and all of its consumers," he maintained.
About the significance of competition, he said that a proper competition framework in the energy sector will also help tackle the circular debt issue and attract foreign direct investment in energy production, distribution and management. He said that the international conference was significant as it held just two weeks after the historic general elections.
The ambassador observed that there has been much debate about the role of the Election Commission in the recent elections, but it is clear that without a strong Commission it would have been impossible to hold elections. In fact, the ECP could have been even stronger and more transparent, he said. He pointed out that a proper competition framework in the energy sector will help to tackle the circular debt issue and attract foreign direct investment in energy sector including generation, distribution and management.
The ambassador said that EU was Pakistan's largest trading partner as trade with EU accounted for about 20 percent of Pakistan's total trade in 2012. The EU received 21 percent of Pakistan's total exports whereas 17 percent of Pakistan's imports comprised of EU manufactured products, he said. Pakistan's exports to EU are dominated by textiles (41.8 percent) and clothing (33.6 percent) products followed by leather products accounting for 12 percent.
The main imports from the EU are mechanical and electrical machinery (48 percent) followed by chemicals and pharmaceuticals (13.5 percent) and telecommunication equipment (12.4 percent). The current euro 8.2 billion EU-Pakistan trade has potentials for further expansion and it will be facilitated by fair competition and a transparent investment regime.
"Regional economic integration in South Asia is priority for the EU. The potentials for increased trade and investment in Sub-continent is enormous. Pakistan's largest trading partner should not be the EU, but it should be your neighbours, particularly India," he added. The CCP is already tackling some of the distortions in Pakistan's economy and it has developed a substantial body of jurisprudence through the numerous orders it has issued. Pakistan now has not only an agency that enforces the law but also home-grown "knowledge" about the application of competition law principles to local conditions, he said. The EU envoy said that for realising the potential of trade and investment in the region a strong competition system was necessary. The CCP should seek to become a regional champion of competition, opening of borders for trade and investment, Wigemark added.