KARACHI, Feb 22: “Rhetoric is not enough. There must be action,” says the Karachi Business Declaration issued here on Thursday by the ICC national committee airing the views of the participants of the two-day ICC Regional Foreign Direct Conference held here on February 17-18.
The declaration was voicing the concern of business on such issues as consistency and continuity of the reform process and a policy for business free from excessive regulation. It also stressed that laws designed to promote investment and trade must be faithfully implemented.
In an informal meeting with the Finance Minister Shaukat Aziz on Monday, leading industrialists complained bitterly that even good policies lose their impact because of poor execution. In a representation given to the finance minister on behalf of those present at the dinner meeting, it was stated that “it is the bureaucracy, the legacy of poor governance, that is the greatest hurdle to restoring business confidence.”
Quoting a specific example, the President of Association of Builders and Developers Mr. Hafiz Butt complained that the HBFC financing has remained suspended for last two years and despite the amendments in laws, making the mode of financing Sharia-compliant .
Similarly, the Sindh government has promulgated an ordinance for de-freezing of lands allotted by the previous governments. The committee, which is to decide individual cases, has made no progress at all.
Businessmen feel that the executing agencies, numerous as they are, do not appear to be business friendly. The problem lies not as much at the policy level as at the execution stage, says the group representation and adds: “The success of official policies lies in their smooth and rapid execution. Words and deeds must match to push up growth rate.”
Mr Latif Ebrahim Jamal, a former president of the Federation of Pakistan Chambers of Commerce told the finance minister that the execution of policies, decisions, projects should be closely monitored to provide comfort to business.
On continuity and consistency in policies he observed that real stability would come from the economic and social progress and not by merely incorporating laws in the Constitution that may or not be observed in times of crises and distress. The Constitution itself suffers from lack of continuity and supremacy. It is the economy and the society, how they are organized, that impart constitutional and social stability.
Noting that the government is making serious efforts to pull the national economy from stagnation, he pointed out that the construction and its allied industries, which are the largest employer in the country, are in doldrums.
A trade leader said the government has a strong external agenda but weak domestic agenda. It’s focus is on budget deficit, exchange rate, forex reserves. Economic growth, investment and poverty reduction have not received the priority they merit.
The finance minister who has a lot of interaction with business told the ICC conference that the government will assess the existing regulation and procedures, affecting the interaction between the administration and business to eliminate irritants and red tape, and with it corruption opportunities.
Other irritants that came up for discussion in the meeting with the finance minister were: taxation, interest rate and law and order. The demands included a growth-oriented and not a revenue-oriented tax policy; an interest rate that does not make investment costly and prohibitive and personal taxes at reduce rates not to drive best talents to other countries.
