CPEC Summit speakers share experiences, stress mutual benefits of economic corridor
The China-Pakistan Economic Corridor (CPEC) will benefit Pakistan as well as China in several dimensions, but the investments in infrastructure need to be sped up, economic experts and analysts told attendees of the two-day CPEC Summit in Karachi, jointly organised by the Dawn Media Group and the Ministry of Planning and Development.
Dr Nadeem Javed, an expert on economic policy, noted that energy investments under the corridor clock in at almost $34 billion.
"The energy sector has already started experiencing improvements in the shape of reduction in unit costs," he said. Thanks to all the spending, the efficiency factor in the energy sector could be increased by 41 per cent, he added.
"Given that around $190bn worth of merchandise will pass through Pakistan under CPEC, the corridor will help Pakistan generate huge [tax] revenues," he later remarked. The corridor will also improve regional connectivity, he said.
"Apart from the energy and infrastructure sectors, CPEC will also benefit the industrial sector," the analyst commented. "Pakistan will become a favourite destination for investments, whereas jobs will also be relocated from other countries in the region to Pakistan," he added.
Shoaib Siddiqui, federal secretary to the Ministry of Planning, noted that the proportion of the workforce on CPEC projects is in favour of Pakistan.
"Two-thirds of the workforce on CPEC projects is Pakistani, compared to one-third Chinese nationals. So we need to understand that this is benefiting us," he said.
The top planning official also hinted at a new system of interaction with Chinese officials. "China-Pakistan relations are not based on unnecessary litigation," he said.
Tang Hao, vice president of the China State Construction Engineering Corporation (CSCEC), said that the economic and social benefits of the corridor will be visible within the next few years. "We will also train Pakistani engineers and technicians," he promised.
He thanked the government and the army for their cooperation.
He thanked Planning Minister Ahsan Iqbal in particular, noting that the minister had extended the visas granted to more than 300 Chinese workers in Pakistan "so they could concentrate on their work here instead of having to return to China for the sole reason of renewing their visas."
Businessman Arif Habib termed the corridor "a win-win situation for both Pakistan and China". However, "Pakistan needs much more in order to make up for infrastructure shortages," he said at one point.
"I am disappointed that only around $4.5 billion have been invested in infrastructure development so far. I am also disappointed at the lack of coordination between stakeholders and policymakers," he said while stressing the need for improvement in dealing with the multi-billion project.
According to him, CPEC projects, after completion, would add 2 percentage points to GDP growth. He also noted that the ongoing construction of CPEC projects has already increased the demand for cement, steel and other construction materials.
Talking about risks to Pakistan, he said that the country must ensure that the quality of machinery and supplies being imported is of international standard. He further recommended that the State Bank give quick approvals for repayments etc, so that more Chinese interested in providing loans can lend money.
"Chinese banks are taking an interest in financing projects in Pakistan. Other banks are also interested in investing in the country," he noted.
China Railways Construction Company General Manager Wang Lei, on the other hand, stressed the need for an improvement in the infrastructure and power sectors.
"Industries need to be upgraded too. They are at least 30 years behind in terms of technology and machinery," he added.
"Pakistan is portrayed as a dangerous state [in international media]. The media should change itself or be changed," he suggested. "News of a bad security situation scares investors."
He also made a few observations regarding Pakistani society.
The official also talked on Pakistan's political instability. He noted that no prime minister in the country has ever completed their term.
"The judicial system is also very different from China — courts take forever to decide cases [here]," he noted. "We can learn a lot from each other."
Senior researcher Hassan Khawar shed light on the trade disparities between the two countries, noting that Pakistani businessmen pay 60pc duties on some products, as opposed to 20pc by other countries.
"For Pakistan, the main incentive in CPEC is economic growth," he stressed.
Former State Bank of Pakistan governor Mohammad Yaseen Anwar, in his speech, stressed the need to address the problems of urbanisation, agriculture and power shortages.
Comments (11) Closed
Pakistan should think carefully about it's socio-economic benefit from CpEC.
One critical component of ‘infrastructure ‘ is having a skilled workforce. Sadly nothing is being done on this front under CPEC.
The article says investment in energy sector almost stands at 34 Billion USD. The government should invest in hydropower projects in the mountainous locations including Gilgit-Baltistan, Chitral , Swat and Khohistan . One location in Bonji has 8100 MW potential. And this can supply electricity to china as well .
There is a great future in Pakistan China friendship.
All the major key position is holding by the Chinese as they are educated and skilled, local worker is facing problem as they not as skilled and educated as Chinese . Government should start program to enhance the skills for local worker. The benefits of CPEC can get the common Pakistan.
In 5 years one can see that CPEC is still about the future and nothing about the present .yes projects are being done and it’s financec by China but we are also obligated to return the money at unfavorable terms , accounting standards are poor , transparency is questionable, security costs are high and the overall viability requires all these missing parts to come together . Pakistan can gain from CPEC can not be the slogan what are Pakistan’s gains from CPEC must be the vision . After all you don’t borrow money at 18% if you cant make greater sense Jan 18% in your investment .
@Jalal You have no idea what CPEC is about, clearly.
All speakers are praising the Chinese for the CPEC. The Pakistani speakers are not giving the correct picture. 34 billion dollars for energy projects. What is the energy cost per unit it is double the cost in India. What will happen to the industry at such high cost of energy. They can never be competitive. One speakers has said that over 900 billion dollars trade will be through CPEC roads. Pakistan will earn huge tax but 90 % will go to Chinese and Pakistan will have to repay the loan and do the maintenance of road and spend on security. Even for a layman the projects viabilities leaves a question mark.
Cpec will definitely improve infrastructure but it will make more easier way for chinese imports to pakistan and no local production which will definitely going to hit economy and jobs
True statements
@Shiva CPEC is leading to moving of Chinese industries to be set up in 9 separate Economic zones on Pakistani territory.
These free zones will create a huge number of jobs that previously did not exist. Moreover as the Chinese Economy replaces the US as the world largest economy in the next decade, Pakistan will be ideally placed to benefit immensely from this change and its growth. The future is bright, you just need to open your eyes.