OICCI survey: Most foreigners want to expand operations

Investment plans come despite issues of security and energy.

KARACHI:

Foreign investors and members of the Overseas Investors Chambers of Commerce and Industry (OICCI) have indicated positive investment plans for next few years, despite issues of security, access to energy and governance.

Moreover, there are concerns related to contract enforcement, tax refunds and intellectual property implementation in the country, show findings of the 2011 Perception and Investment Survey unveiled by OICCI on Thursday.

The survey, conducted every other year, has collected data from OICCI members only. OICCI represents investors from 33 countries that have a presence in 14 sectors of Pakistan’s economy and contributes about 22% to total tax collection and 29% to the gross national product (GNP).

Nearly, all the members who participated in the survey intend to continue operating in Pakistan, and two-thirds of the respondents indicated an intention to expand operations.

Over 45% of the respondents plan to invest more in the next four to five years as compared to the corresponding past period and 59% of respondents plan to increase their headcounts.

The positive business plans show expectations of some economic stability and a modest improvement in Pakistan’s economic growth parameters.

Total investments indicated by the respondents amount to approximately $3 billion over the next two to five years, which, though an improvement over the past, is well below the potential and opportunities in the country.

In terms of business prospects, over 80% of respondents expect an increase in sales and 66% expect their profits to go up. This is expected to increase the contribution to the national exchequer, provide better employment opportunities and have overall positive impact on both the economy and society.

Commenting on the report, OICCI president said foreign investors were concerned with the law and order situation, which was the biggest challenge faced by the business community, closely followed by energy supply. Political instability and high inflation are other major challenges.

Published in The Express Tribune, February 24^th, 2012.