The Punjab Board of Investment and Trade is fast emerging as one of the country’s active public sector agencies fetching foreign direct investment for different sectors of the economy.
In the last six months, according to the numbers provided by the PBIT, it has helped bring in a substantial amount of nearly $250m for different projects in chemicals, cement, entertainment, construction, hospitality, packaging, footwear, waste-to-energy, dairy and livestock sectors in Punjab.
“The amount of foreign direct investment for different businesses varies from $400,000 to $60m, depending on the requirements and the size of the project,” Amena Cheema, who took over as chief executive officer of PBIT in November last year, stated in an interview.
The Punjab Board of Investment and Trade is negotiating projects worth over $1.1bn with foreign investors
She said the board was negotiating projects worth over $1.1bn for Punjab with foreign investors. “I’m positive that we will be able to attract double this amount of FDI during this financial year,” said Amena, who has worked as
advisor to the President of the UN General Assembly and special advisor to the Ambassador of Saudi Arabia to the United Nations in New York.
The PBIT-assisted projects include Chinese investment of $500m in a special economic zone near Lahore, Korean investment of $100m in a joint venture on the establishment of a special agro-based economic zone near Faisalabad, Chinese, American, Turkish and Gulf investment of $200m in the construction of grain storage silos, Turkish investment of $100m in a diapers, sanitary papers and a range of detergents manufacturing facility.
“So you see we are fetching investment from a number of European and Asian countries for different sectors of the economy,” she smiled.
Amena, who has an experience of working in areas of policy analysis, mediation and inter-government negotiations for more than 16 years, argued that Punjab was fast emerging as next investment hub in the region.
“What makes Punjab attractive for foreign investors is the fact that its gross regional product (GRP) is bigger than many European and Asian countries, a considerably high per capita income (greater than the rest of Pakistan) and over a third of its population living in cities,” she said. “Our cost of labour is still very low and we have smarter human capital than anywhere else in the world.”
“Besides, the bulk of the province’s population is under 30, literate and has skills. Additionally, the Shahbaz Sharif government has created a world-class infrastructure across the province over the last few years.”
A graduate of Columbia University, New York, and University of Richmond, Virginia, Amena said the board worked with foreign governments and investors through their embassies in Islamabad to build a positive image of Punjab as an important investment destination as well as link local businessmen with foreign investors for collaboration and joint ventures.
“We act as matchmakers between foreign investors, provincial departments and private businessmen. Moreover, we also play an important role as an after-care agency to help resolve issues with local government agencies and departments, acting as a one-stop shop for investors. The idea is to enhance the business climate in the province.”
The CEO said the board was not only trying to attract foreign investment for new projects. “We are equally focused on convincing foreign investors to invest in sick and closed industrial units in the province.”
The PBIT, for example, has helped Gharibwal Cement secure financing of $45m in recent months. At present, the PBIT is working to link a major textile group to access foreign funds for reviving their factory.
“There are many closed textile and other factories in the province and we are trying to help them secure funds from foreign investors to revive production. The revival of closed factories is as important as the establishment of new projects. We are trying to reach out to entrepreneurs to work with them and help them secure investment they require,” she said.
“There are many foreign investors, especially Chinese investors, who like to invest in an existing business outside their country rather than set up a new one. The idea is to attract foreign investment, enhance existing businesses and create jobs in the province in line with the growth vision of chief minister Shahbaz Sharif.”
Amena said the board was compiling data of businesses in a difficult situation in Punjab. “Several large groups have gone bankrupt over the last few years and jobs lost. We need to help them revive.”
Amena said she was focusing on bringing investors who were interested in putting their money in infrastructure projects like airports and in the social sector like education, clean drinking water and health.
She was frustrated to note that overseas Pakistanis were mostly interested in investing their capital in real estate rather than in productive areas.
Soon after taking over the PBIT, she sat down to revamp it to make more focused efforts. “I have re-strategised the board in the last eight months to achieve our objectives and involved the World Bank to train our staff.”
She is taking a roadshow to Shanghai in September to market opportunities of investment in large format retail, manufacturing, dairy, textiles, fruit and vegetable cold chains, grain storage silos, halal food, automobiles, chemicals, footwear, pharmaceuticals, etc.
The PBIT chief said: “Now we make more targeted efforts here instead of doing things randomly. It’s a tough and competitive world out there. When you are competing in global markets for finances you have to be alert, smart and pro-active. There’s lot of liquidity in the world markets and we can bring it here if we play smart. China, Europe and Gulf countries have to expand and we can use this opportunity to our advantage.”
Published in Dawn, Business & Finance weekly, July 11th, 2016