September 4, 2002	Wednesday	Jamadi-us-Saani25,1423

ISLAMABAD, Sept 3: The government has set up a “Procurement Authority” to ensure total transparency in contracts by local and foreign firms, says Minister for Finance Shaukat Aziz.

The authority, he pointed out, would frame ground rules for public spending on all projects and pre-empt chances of impropriety.

He was talking to Jung Koo Lee, President Daewoo E&C Co. Ltd, who called on him here on Tuesday with his delegation to discuss possibilities of investing in Pakistan.

After the meeting, the finance minister told Dawn that Khalid Javed has been appointed as the first Managing Director of the Procurement Authority. “This Authority will be an attached department of the Ministry of Finance which will frame strict penalties to discourage commissions and kickbacks in local and foreign contracts”, he added.

He said that commissions will have to be disclosed before the Procurement Authority, the writ of which will eventually be applied on all governments’ organizations. “I tell you that penalties will be higher to stop commission business”, the finance minister assured.

He said the idea of establishing Procurement Authority was conceived after having studied similar organizations in many other countries.

According to an official announcement, Mr Jung said that it was a matter of great satisfaction that Pakistan has achieved economic stability, introduced transparency through structural and financial reforms, its foreign exchange reserves have grown to over $7 billion and have provided conducive atmosphere to foreign investors to explore possibilities of increasing their investment in an economically congenial and friendly atmosphere.

The finance minister informed him that Executive Committee of the National Economic Council (ECNEC) has recently approved projects worth over $1.2 billion out of which an amount of $1 billion have been earmarked for construction of hydel power stations and communication network including development of railways.

He said since these projects would be offered through open tenders, Daewoo should consider participating in these projects through open bidding.

Aziz said that as a result of structural and financial reforms, the gross foreign exchange reserves have increased to $7.5 billion, free exchange rate has been introduced, non-oil and non-food imports have increased to over 51 per cent in July as compared to the corresponding period of last year.

“This indicates increased investment in manufacturing sector especially in textiles”, he said. Karachi Stock Exchange was the best performing market in the world and reforms introduced by Securities and Exchange Commission of Pakistan (SECP) has improved development of capital markets. Exports were likely to cross $10 billion mark by the end of current financial year.

The inflation has been contained to 3.5 per cent and GDP growth is expected to be around 4.5 per cent. These economic indicators, finance minister said, will restore confidence of investors in the business climate of Pakistan.

Mr. Jung expressed interest to take advantage of Pakistan business climate. He further said that his company was keenly watching reconstruction activities in Afghanistan. It would shortly engage itself to explore possibility of participating in various projects there.