KARACHI: “The unique geographic, demographic and economic characteristics of Central Asian countries make it imperative to pursue regional integration and cooperation if they are to integrate globally,” said Philippines, Dr Guoliang Wu, the unit head of Central Asian Regional Economic Cooperation (CAREC) at the Asian Development Bank in Manila. He was speaking at the inaugural session of the three-day international conference on “Central Asian regional Economic Integration and CPEC: prospects, challenges and the way forward” organised by the Applied Economics Research Centre (AERC), at the University of Karachi here on Tuesday.

“Positioned in a vast land-locked location, Central Asian countries face thick borders among themselves with their Eurasian neighbours and with global markets. There resides a relatively small population in the region and their combined economic mass constitutes only a modest-sized economy. Intraregional integration is the only sure path leading to interregional integration and the definite prerequisites transforming from being land-locked to land-linked,” he added.

Dr Wu mentioned that Pakistan and Central Asia have shared a geo-cultural affinity and a long tradition of historical contacts. “The China-Pakistan Economic Corridor as the flagship component of the Belt Road Initiative provides a great opportunity serving as a catalyst to further boom the economic, social and cultural ties between Pakistan and the Central Asian countries,” he said.

Dr Imtiaz Arif of Iqra University spoke about the determinants of Chinese foreign direct investment (FDI) and lesions from CAREC countries. He mentioned that in order to compare Chinese investors’ sentiments for CAREC region and the rest of the world, a panel data set of 76 countries around the globe was used. According to him, the empirical results show that natural resources are a significant positive determinant of Chinese foreign direct investment inflows to CAREC region, whereas, the institutional quality has been found to be insignificant.

Mahnaz Muhammad Ali from the Islamia University of Bahawalpur presented a paper on ‘FDI and current account balance: the case of south Asian economics.’ She said that the current account balance is an indicator of external balance and it plays a significant role in determining macroeconomic stability in the country.

Earlier, the advisEr to the Prime Minister on Institutional Reforms and Austerity, Dr Ishrat Husain, the chief guest on the occasion, said that CPEC was very important for both countries and the main objective of the conference was to debate and design all those development policies and strategies that could help in understanding the issues pertaining to regional economic integration of the Central Asian countries and the game changer project CPEC.

Mubashar Hussain from Muhammad Ali Jinnah University spoke about exploring the nature of the relationship between political instability and economic growth in Pakistan. He observed that political stability has been an issue for the country since its inception and consequently economic growth presents a marked fluctuation.

“The current situation and the era of globalisation have set some bench marks in various fields of applied economics but at the same time Central Asia and Pakistan are facing lots of challenges to achieve sustainability of the economy,” he said. It was also observed that the effective plan for an economic integration system may help in making sound and workable policies to ensure a concrete base for lasting economic and social development of countries in the region and Pakistan as well.

Karachi University VC Dr Ajmal Khan said that all sectors of our economy are in need of new set of rules and state of the art methods to improve the economic situation and set it on the path of lasting growth.

Published in Dawn, December 19th, 2018

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