Making PM’s visit to China successful

Pakistan must communicate its financial situation, pressure it faces from IMF, West

ISLAMABAD:

A few days ago, the deputy prime minister and planning minister of Pakistan visited China. The planning minister was in China to discuss the Joint Cooperation Committee (JCC) agenda and explore options for further enhancing cooperation under the China-Pakistan Economic Corridor (CPEC) framework.

The deputy PM engaged with the Chinese leadership to discuss the future course of cooperation, the acceleration of the second phase of CPEC, and matters of mutual security. He also discussed the upcoming visit of the prime minister of Pakistan to China.

The PM’s visit to China is expected in the coming days, most likely in June. Therefore, these two visits were important, and it is expected that the premier’s visit will conclude with positive outcomes.

The prime minister is visiting China at a crucial moment for several reasons. First, China has just started the journey to achieve the goal of high-quality development and adopted the New Quality Productive Forces.

It is perceived that these new productive forces will assist China in achieving the goal of high-quality development and transition from Industry 3.0 to Industry 4.0. This transition will create numerous opportunities along the supply chain, and Pakistan can benefit from these opportunities by adopting a wise policy.

Second, regional and extra-regional situations are becoming extremely complicated. Western powers led by the USA are creating a web of chaos around China. Many experts believe that the USA is encouraging India to play an active role in Afghanistan and regional countries to complete this web of chaos. Third, a new world order is emerging. Many countries have shown resistance to Western bullying attitudes. President Xi Jinping’s recent visit to Europe and President Putin’s hosting in China have further accelerated this process.

President Xi visited Europe to explore options for mutual win-win cooperation, but Western media described it as an effort to divide the West. This is a clear sign that the Western bloc did not like it.

Fourth, Pakistan is considered a stumbling block to netting the web of chaos around China. Therefore, all efforts are being made to weaken Pakistan and create a wedge between China and Pakistan.

Fifth, Pakistan’s weak financial status is being exploited by international financial institutions like the International Monetary Fund (IMF) and many Western countries. China is helping Pakistan avoid default, but the IMF is pushing hard to accept its terms and conditions, with CPEC being a primary target.

Therefore, the visit is important not only for bilateral cooperation but also for its global relevance and significance. Pakistan must analyse the dynamics carefully and devise a policy to make the visit successful.

The biggest challenge at this point is the security of Chinese personnel and investment in Pakistan. After the withdrawal of USA and NATO forces from Afghanistan, terrorists are using Afghan soil to attack Pakistan, and Chinese investment and personnel are the prime targets.

Recently, I visited China and met with businesspeople, experts, policymakers, and other officials. They all emphasised the importance of security. Businessmen were eager to invest in Pakistan, as the government of China and the Communist Party of China encouraged people to invest in Pakistan. However, they stressed the need for a solid security framework.

Thus, a security plan must be devised according to the needs of the second phase of CPEC, regional dynamics, global changes, the emergence of the new world order, and the significance of fifth-generation warfare.

Two fundamental changes are needed: the roles and responsibilities of civil and military agencies and the relationship between the security apparatus and Chinese companies and personnel working in Pakistan.

Moreover, the government must put in serious efforts to address the concerns of potential investors. First, the government must carefully map the potential elements of security threats. Second, identify the actors involved. Third, prepare an action plan to eliminate threats without any discrimination. Fourth, Pakistan and China must work hand in hand to devise a security policy and plan to secure mutual interests.

The government must also have concrete policies and plans to facilitate the investment and business community. Despite improving the “Ease of Doing Business” ranking, the ground-level business environment is not very conducive to investment.

Pakistan established the Special Investment Facilitation Council (SIFC) to solve these issues, but it remains a facilitation body without decision-making or implementation powers. To benefit from the SIFC, Pakistan must take five steps: minimise the role of bureaucracy and the army in devising economic policies, staff SIFC with economic experts, grant SIFC decision-making powers, study the Shenzhen model for reforms, and ensure the ruling elite invests in Pakistan to build trust.

Unfortunately, leaks show that the ruling elite is taking money out of Pakistan. Against this backdrop, how can we convince investors, let alone Chinese investors?

Since its creation, Pakistan has implemented a liberal economic and governance system. Despite all efforts, we cannot progress; rather, we are in reverse mode. The economy is deteriorating daily, and financial status has become extremely fragile. Thus, we can try something different.

We can learn from the Chinese system of economy, people-centric governance, the balanced role of state-owned enterprises and the private sector, merit-based governance, and whole process democracy, among other things.

Additionally, Pakistan must communicate its financial situation with China and the undue pressure it faces from the IMF and Western countries. Pakistan needs more financial cooperation from China to avert this pressure.

In conclusion, the visit will not benefit Pakistan much without taking the required decisions to solve the issues of the business environment and security. Therefore, it is suggested that the government spend less time on rhetoric and more time devising concrete policies and plans that can satisfy the concerns of China and the business community.

THE WRITER IS A POLITICAL ECONOMIST AND A VISITING RESEARCH FELLOW AT HEBEI UNIVERSITY, CHINA

Published in The Express Tribune, May 27^th, 2024.

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