Foreign investment/FDI hits 8-year high $2.41b in 2016-17, up 5%

[Kabira]

 

[Kabira]

Foreign investment hits 8-year high

KARACHI: Foreign direct investment (FDI) increased 4.6 per cent to $2.41 billion in 2016-17, data released by the State Bank of Pakistan (SBP) showed on Monday.

FDI in the last fiscal year was the highest since the PML-N government came to power four years ago. It was $1.45bn in 2012-13 and fell to $988 million in 2014-15. It improved to $2.3bn in 2015-16 and inched up further to reach the eight-year high in 2016-17.

China emerged as the top investor during the last three years with the onset of the China-Pakistan Economic Corridor (CPEC).

FDI from China in 2016-17 was $1.18bn, almost half of the total inflows received throughout the year. Growing investment from China is giving rise to both fears and hopes. The government expects the CPEC will stabilise the economy in the long run as its large-scale projects bear fruit.

China emerged as top investor in last three years

A Dutch company bought a majority stake in Engro Foods for $463m, which made Netherlands the second biggest foreign investor. The country had invested just $30m in 2015-16.

Turkey invested $135m, France $119m, United States $71m and United Kingdom $69m.

The United Kingdom invested $151.6m in 2015-16, but its FDI dropped over 50pc in 2016-17. FDI from the United States increased to $71m against just $13m in 2015-16.

Inflows from Arab counties remained small despite a significant volume of bilateral trade.

According to the SBP, overall foreign private investment declined 5.3pc to $1.88bn compared to $1.98bn a year ago. Portfolio investment witnessed an outflow of $531m compared to the outflow of $320m a year ago.

Compared to regional countries, Pakistan has been receiving smaller FDI over the years. According to one published report, India received $62bn while China attracted $59bn in 2016.

Pakistan’s current account deficit for the first 11 months of 2016-17 amounted to $10.6bn. In contrast, the country attracted FDI to the tune of $8.86bn in the last five years.

Published in Dawn, July 18th, 2017

 

[ziaulislam]

major challenges are low FDI, low exports, decreasing remittances and looming current account deficit and lack of planning regarding controlling imports(e.g govt still planning to import electricity rather than importing fuel and producing power at home)

 

[Devil Soul]

China leads as Pakistan sees FDI of $2.41b in 2016-17, up 5%
By Farhan Zaheer
Published: July 18, 2017
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PHOTO: AFP

KARACHI: Foreign Direct Investment (FDI) increased by 5% to $2.41 billion in fiscal year 2016-17 which ended on June 30, compared to $2.30 billion in the previous year, according to data released by the State Bank of Pakistan (SBP) on Monday.

Pakistan received $5.4 billion in fiscal year 2007-08, which is the highest amount in the country’s history, according to the Board of Investment (BoI).

However, the country has been recording low levels of foreign investment since 2008. Many foreign investors, especially from western countries, have pulled out due to the persistent energy crisis, poor governance and security challenges.

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CPEC praised for enhancing regional connectivity

China dominates with 49% share

Chinese investors are pouring cash due to the China-Pakistan Economic Corridor (CPEC) projects mainly in major infrastructure projects. Pakistan’s eastern neighbour leads the list of individual countries pouring investment in FY17 with $1.186 billion, up by 11% from $1.064 billion in the last year.

In June 2017 alone, the country received net FDI of $104 million from China.

Netherlands emerged as the second leading country with FDI of $463 million in FY17 compared to just $29.9 million in the same period of last year. This comes on the back of a $448-million acquisition of Engro Foods by FrieslandCampina – a Dutch food company.

Turkey came at number three with $136 million in FY17 compared to just $17 million in the same period of last year while France brought in investments of $119 million compared with $95 million in the corresponding period.

Major decline from Norway, Egypt, UK and UAE

Fiscal year 2017 saw a major decline in FDI coming from Norway, which dropped to a negative $13 million from $172 million in FY16. Similarly, this year Pakistan did not receive any FDI from Egypt though it got a decent FDI of $141 million from the North African country in 2016.

The FDI coming from UK declined to $69 million in FY17, down 54% from $151 million in last year. Likewise, the country received just $59 million from the UAE in FY17, down 46% compared to $110 in the previous year.

Overseas investors find 94% reduction in crime

Sector breakdown

Power sector received the highest FDI of $795 million in FY17, but it was still significantly down from $1.159 billion from the previous year.

This was followed by the food sector where the country received $493 million in FY17 compared to net outflow of $56 million in the previous year.

Surprisingly, construction was also among the fastest growing sectors in FY17; receiving a significant $468 million compared to just $46 million in FY16. The electronics sector also received a respectable $143 million compared to just $34 million in FY16.

Published in The Express Tribune, July 18th, 2017.

 

[BetterPakistan]

This is a good news. I hope Pakistan FDI increases to $4 bn in fiscal year 2017-18 and our exports also increases by 10%.

 

[SoulSpokesman]

Good news. I guess as CPEC ramps up this could peak at around USD 10 bn (assuming no incremental parallel infusions from other investors)

Regards

 

[volatile]

GReat news its time to fix exports with FDI in certain segments

 

[Abingdonboy]

This is a good news. I hope Pakistan FDI increases to $4 bn in fiscal year 2017-18 and our exports also increases by 10%.

For that FDI inflows would have to increase by more than 65% in one year, considering they only grew by 5% this year it is out of the question that FDI will touch $4bn in FY2017-18. At this rate, Pakistan may see that in 6-7 years.

 

[RealNapster]

 

[KN-1]

Meanwhile textile exports fell 23%....

 

[sparten]

Meanwhile textile exports fell 23%....

Meanwhile Industrial output increased by 7%.

Textiles saw an increase in output. More and more capacity is being used for the very lucrative domestic market,rather than the few cents on the dollar overseas one. Large industrial concerns especially. Like Nishat.

 

[BetterPakistan]

For that FDI inflows would have to increase by more than 65% in one year, considering they only grew by 5% this year it is out of the question that FDI will touch $4bn in FY2017-18. At this rate, Pakistan may see that in 6-7 years.

I hope you go & research first than commenting next time.

Pakistan FDI 2015-16 = $1,281.1 Million
Pakistan FDI 2016-17 = $2410 Million = 88% more than previous year not 5%