By Ayesha Saba

ISLAMABAD, Aug 17 (INP-WealthPK): Pakistan can materialize the dream of economic progress and development by benefiting from its strategic location and long-standing affinity with China, said a CPEC official while talking to WealthPK.

Dr. Liaqat Ali Shah, Executive Director and Head of Policy Division at the CPEC Authority, said, “China's rebalancing in the new normal towards consumption and service-led growth creates opportunities for Pakistan. To capture the potential benefits, Pakistan must rely on the comparative advantage in certain product lines vis a vis China and other regional competitors and develop them as per the Chinese market demand and preferences including leisure products, textiles & apparel, handmade items, medical & surgical instruments and discretionary staples in agriculture.”

Dr. Liaqat further said, “If developing nations like Pakistan want to fully benefit from China's transition, they must understand what the "new normal" in China involves. In light of China's economic transition, it is widely believed that industrial relocation will take place in the labour-intensive sectors.”

“China's upgrading to upper-stream industries will offer a significant space for Pakistan to enter a labour-intensive industrialization development phase. The sectors where Pakistan can benefit are tourism, entertainment, agriculture, and advanced industrialization”.

“China is experiencing transformations; it’s time to broaden our thinking and look for avenues of cooperation, both within and outside of CPEC. Moreover, our strategic relationship with China continues, but the long-term social and economic benefits can only be realized if our approach to cooperation with China is people and business-centric.”

Under this new normal, the economy is shifting from a high to a medium-high rate of growth, from a growth model that emphasized scale and rate to one that emphasizes quality and efficiency, from an economic structure in which economic growth was mainly fuelled by the increment and increased industrial capacity to one in which the existing capacity is adjusted and the increment is put to best use, and from being driven by production factors such as resources and low-cost labour to being driven by innovation. Such changes are essential for China's economy to upgrade to a more advanced level, with a better division of labour and a more rational structure.

For Pakistan, the CPEC offers a rare opportunity to address some of its long-standing bottlenecks to sustained economic growth, not least its chronic energy deficits, poor transportation infrastructure and connectivity, and weak industrial development. Pakistani firms, especially diversified conglomerates, are aggressively seeking access to Chinese finance and technology through the joint ventures. New market entrants are also emerging in Pakistan — local firms that are aligning themselves closely with China as an intrinsic component of their growth strategies.

Credit: Independent News Pakistan-WealthPk