LAHORE, JAN 18: /DNA/ – The All Pakistan Business Forum (APBF) has urged the government to promote foreign direct investment (FDI), as Pakistan experienced a 32% decline in Dec 2024, with inflows falling to $170 million compared to $252 million in Dec 2023.
Quoting the latest data of the State Bank of Pakistan APBF President Syed Maaz Mahmood has said that drastic steps can revive the economy, which needs to grow significantly and constantly. He advocated the need for raising the country’s tax base so that tax-to-GDP ratio improves from the current 11%.
However, it is also the fact that despite the December setback, FDI surged by 20% in the first half of FY25, with total inflows reaching $1.33 billion between July and December, up from $1.11 billion during the same period last year.
The $221 million increase highlights improved investor confidence, even as portfolio investments faced significant challenges.
During the first half of FY25, total FDI inflows amounted to $1.88 billion, with outflows recorded at $554 million.
However, portfolio investments saw an outflow of $222 million during the same period, reflecting ongoing challenges in equity markets.
The SBP also reported that overall foreign investment, which includes FDI, portfolio investment, and foreign public investment, recorded a modest 5.8% increase, reaching $1.247 billion in the first half of FY25 compared to $1.18 billion in the corresponding period of FY24.
APBF Chairman Ibrahim Qureshi said that while FDI performance remains a bright spot for Pakistan’s economy, policymakers need to focus on addressing the challenges in portfolio investments to sustain overall foreign investment growth.
APBF Chairman said that the primary function of a trade office is to promote exports that have persistently been falling for a long time. He urged the trade officers to explore opportunities to diversify exports of goods and services in their respective areas.
Maaz Mahmood also urged the trade officers to explore opportunities to diversify exports of goods and services in their respective areas, asking them to meet the challenges faced by Pakistan in European markets.
He said that country’s major export markets did not see any significant growth in importing goods from Pakistan in the financial. He also suggested the ministry to devise strategies for promotion of Pakistani products, calling upon trade officers to take advantage of opportunities offered by China-Pakistan Economic Corridor (CPEC).
The APBF President said that Pakistan’s exports to the US and the UK, two high-priced markets, have seen substantial growth in the first quarter of the current financial year. However, exports to China have sharply declined during the same period. The UK has overtaken China to become the second-largest export market for Pakistani products. The US remains the top export market for Pakistan, with exports to the country crossing the $1 billion mark in the first quarter. Exports stood at $1.454 billion, compared to $1.309 billion in the same quarter of the previous fiscal year, registering an 11 per cent increase.
He said that Pakistan has remained a potential market for foreign investors, who still have plans to make fresh investment in the country, but they have continued to wait for the return of economic stability.
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