Local and foreign investments grow by 20 percent: Shaukat
LAHORE (December 20 2006):
Prime Minister Shaukat Aziz has said that domestic and foreign direct investments have grown by 20 percent, which is the highest in the last two decades.
Addressing the 22nd Annual General Meeting and Conference jointly organised by Pakistan Society of Development of Economists (PSDE) and Pakistan Institute of Development Economics (PIDE) here on Tuesday, he said the improving economic growth had started to cast its impacts on all segments of society as unemployment and poverty were declining significantly.
The government's financial reforms and privatisation strategy had led to a vibrant trade sector that was empowering the consumer for the first time, he added.
Through prudent economic management, first generation reforms of fiscal consolidation, debt reduction, deregulation, privatisation, and transparent governance, Pakistan's economy had grown at an average rate of almost 7 percent per annum during the last four years, he maintained.
"Our government is committed to good governance through transparency and accountability. Democratic institutions have been strengthened while a deep-rooted process of decentralisation has been set in motion, the Prime Minister said.
He further said that the government was committed to a continuous process of reforms and had embarked a second generation of reforms covering infrastructure up-gradation, institution building and human resource development. He said the government agenda of second generation structural reforms had three prongs, which were mutually reinforcing to achieve good governance and institutional strengthening.
Aziz further said that the government was determined to a market based economy and in this connection it was deregulating markets and improving supervision and regulation of markets to ensure greater competition.
"We have also been developing deeper and more liberal agricultural markets by allowing market based agriculture pricing, free movement of commodities and introducing private sector in wheat operations. We have also developed markets in media, energy and telecom sectors," he noted. The government was developing policies and regulatory mechanism that were aligned to global norms. He further said.
"We have thus adopted measures for better tax and tariff policy including better tax administration. Our fiscal responsibility and debt Limitation Act 2005 puts a check on the mismanagement of fiscal policy by future governments," Aziz said.
As part of the drive to strengthen institutions, the government had already launched initiatives to modernise several of the key agencies of government including judiciary, civil service, monopoly control authority and the police, he said.
This will of course be done by deepening decentralisation, developing greater transparency, utilising the latest technology and relying on a high degree of professional and technocratic management, he added.
The Prime Minister said that commercial, regulation and corporate laws, which defined and protected the rights of investors in debt and equity markets, needed to be constantly updated so that the legal framework facilitated market transactions and protected the rights of all transactions.
The Securities and Exchange Commission of Pakistan (SECP) had actively been pursuing a reform roadmap to develop an efficient corporate sector and capital market based on sound regulatory principles.
"We have provided security to minority shareholders and made efforts to bring transparency and better management and governance structure in the private sector," Aziz maintained.
He stressed upon the quality of law enforcement and said that it was the enforcement of good commercial laws, rather than their mere existence, which encouraged economic agents to engage in market transactions with each other. Access to justice including a fair and quick disposal of court cases was best viewed as a basic constitutional right while efficient justice system expedited economic transactions, ensured sanctity of contract and protected the marginalised groups, the Prime Minister observed.
"Our real challenge is to devolve effective power, citizen empowerment, community based accountability and financial autonomy to the lowest level of local government. It is indeed necessary for effective decision and implementation system down to the grass root level," he said.
He called for developing and implementing an agenda of second generation reforms that provided the rule of law, political stability, economic progress, security of life and property and an efficient transparent and accountable government. Earlier, speaking on the occasion, Director PIDE and President PSDE Nadeemul Haque highlighted the role and achievements and future plans of the society.
He also elaborated the efforts made by the society for collaborating with several Pakistani educational institutions, scholarship programme, conducting conferences and research work.
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$5 billion FDI during currnt fiscal year is another tribute to governments current policies.
