PM Shehbaz Loses China Investment Turf
Diplomacy is an art. And economic diplomacy is a special skill. If you don’t have it, don’t let others know. If you don’t have any positives to tell, don’t tell negatives otherwise.
This is where Prime Minister Shehbaz Sharif along with his entourage of ministers and key officials has failed miserably during his recent China visit. It has turned out to be all but a damp squib when it came to attracting Chinese investors.
Approximately 100 businessmen flew on a special chartered flight from Islamabad to Shenzhen, China, for the B2B sessions organized by the Embassy of Pakistan in China, at the Pakistan China Business Forum.
The Government delegation was headed by PM Shehbaz Sharif, accompanied by, Ishaq Dar (DPM & Foreign Minister), Khawaja Asif (Defense Minister), Mohammad Aurangzeb (Finance Minister), Ahsan Iqbal (Planning Minister), Jam Kamal Khan (Commerce Minister), Aleem Khan (BOI & Privatization Minister), Rana Tanveer (Industries Minister & MNFS&R), Dr. Mussadiq Malik (Minister for Petroleum), Shaza Fatima (Minister IT), Atta Tarar (Minister Information) Pakistan Ambassador to China, Trade Counsellor to China and other staff members of BOI, Ministry of Commerce and Information, who were greeted by Executive Mayor (Deputy Mayor) of Shenzhen and Ambassador of China to Pakistan.
In his opening speech, Muhammad Aurangzeb, the finance minister spoke about Pakistan’s ongoing pursuit of an extended IMF program and Pakistan’s current debt woes. It was a non-starter as the finance minister couldn’t go beyond Pakistan’s crippling need for macroeconomic stability and financial discipline. His speech was of no interest to the Chinese business since it lacked any success story and the audience was left desperately unignited.
The Mayor of Shenzhen, on the contrary, delivered a speech that was on the spot. He spoke about the success of China in the last 30 years and the transition of Shenzhen as a newly developed city becoming a modern technology hub that is leading China’s growth in IT, AI, and micro-chip Manufacturing.
The Mayor informed the audience about Shenzhen’s continued growth and stressed that Shenzhen will continue to grow and reach a $1 trillion economy by 2030. Shenzhen’s current GDP is $ 491 billion which he hopes to double in the next 5 years. Whereas Pakistan’s GDP stands at $374 billion. The brazen fact that our PM was received by the deputy mayor of a province boasting a GDP double our entire country’s says all about reality.
Then came the Deputy PM of Pakistan, Ishaq Dar spelling out stats he had memorized, dwelling in the past and reminding everyone that he had left in 2017 a Pakistan that was doing so good according to Moody’s reports.
Deputy PM spoke about Pakistan missing the train and wasting the last 5 years with no economic growth. “Come and invest in Pakistan since we have SIFC there waiting for you,” came the bland message from Mr Dar which didn’t seem to impress the foreign community completely uninterested in Pakistan’s internal economic mess.
PM Shehbaz Sharif, already in stolen mandate crosshairs back home, did little to restore the country’s repute as an investor-friendly destination. Addressing around some 200 Chinese companies, PM Shehbaz Sharif unleashed a shocker for investors while being over-apologetic and elaborative regarding Chinese staff’s recent killings in Pakistan, creating a sense of fear across potential Chinese investors.
PM’s mentioning of the death of Chinese workers was EXTREMELY unnecessary as Chinese people are one of the most apolitical communities in the world. Also, when one is looking for investment, one should paint a promising picture to lure investors in, NOT a Doom’s Day scenario.
PM Shehbaz spoke about his Punjab Speed, a title given to him by a Chinese counterpart. He stressed that he needs Shenzhen speed now. PM invited the business community to invest in Pakistan in the fields of solar manufacturing, textile, mining, IT, and other areas.
It marked the third unimpressive speech in a row offering no perspective on investment in Pakistan. The speech lacked any friendly policy announcement, business plan, targeted sector, and investment approach. The PM along with his team was running around in circles not knowing what the Chinese approach to investment is.
Time to buckle up for the fourth player! Planning Minister, Ahsan Iqbal remained fixated on his opponent in jail while others spent their speech time on IPP issues and IMF packages.
What Chinese investors were interested in knowing was why they should invest in Pakistan. “Sadly, none of the speakers addressed that”, informs a source privy to the development.
Former PM Imran Khan was no different. With ‘corruption’ and ‘accountability’ being the buzzwords throughout his tenure, he was criticized by the corporate sector for all those references to corruption he made at international forums.
With an already inconsistent and challenging business environment for investors, who would want to risk their investment in a country marred by controversies, corruption, security concerns, a reeling economy that takes a new hit from protest calls, political instability, and redundant administrative processes including dozens of taxes and multiple NOCs required to start or expand businesses.
With the United States and other Western countries reevaluating their foreign investment regulations, foreign investors in Pakistan continue to dwell through a plethora of problems, while many have already left the country finding it difficult to do business.
The same goes for domestic investors. While IMF bailouts can provide temporary relief but these are never enough to reassure investors and foreign businesses in a country where the foreign exchange reserves are dwindling.
Key failures of the trip:
- No top-tier Chinese company attended the forum
- The companies that attended were mid-tier and their sales agents were looking for sales.
- Some companies that couldn’t get much success in Pakistan were looking to meet government delegations to push for their past projects.
- Pakistani PM Security annoyed the Chinese Business Community, as many were not allowed in the ballroom and were made to wait for over 2 hours for the security screen much to their dismay. The Chinese businessmen were unaware of this pre-condition. One Chinese businessman was heard telling the Pakistani organizer not to bring their country’s problem to China as he had never heard of such protocols.
