By Abdul Wajid Khan ISLAMABAD, March 2 (INP-WealthPk) The United Nations Development Programme (UNDP) says China Pakistan Economic Corridor (CPEC) offers an excellent opportunity for international investors to benefit from Pakistan’s emerging economic potential. In its report titled “Leveraging Private Investment for Pakistan’s Sustainable Development”, the UNDP says the CPEC adds further to Pakistan’s strength, as it enhances the country’s connectivity to new markets. The report highlights that under the CPEC, the focus is now shifting towards industrial cooperation and agriculture sector development. This offers an excellent opportunity for international investors to take advantage of Pakistan’s emerging economic potential, with a possibility to tap the regional markets of western China and Central Asia. It adds that CPEC is part of China’s Belt and Road Initiative (BRI) which was launched in 2013 with ambitious $575 billion investments in regional connectivity to develop new markets across 70 countries. Pakistan has already received substantial Chinese investment under CPEC in its early harvest projects in energy and transport infrastructure sectors. It further adds that CPEC offers enormous opportunities in trade and transport logistics, skill development, and developing regional value chains with western China and Central Asia. Highlighting the investment opportunities regarding Sustainable Development Goals (SDGs) related projects, the report says with a market size of 210 million people and a growing economy, Pakistan offers multi-billion-dollar investment opportunities in sectors aligned with the SDGs. These sectors include transport and logistics, renewables and alternative energy, healthcare, education, and technology and communication. It adds that projects have been identified to expand highways for connecting lagging regions, renewable energy, electric vehicle infrastructure, digital education, medical equipment manufacturing, and various technology start-ups. The report proposes a $1billion SDG financing pilot program to demonstrate sustainable and innovative partnerships for shared prosperity, stability and development in order to achieve the promise of UN’s Agenda 2030. The report further says Pakistan’s economy has shown great resilience in dealing with the challenges associated with the Covid-19 pandemic, while simultaneously putting in place key policies and reforms to stabilize fiscal imbalances. With a 3.98 percent GDP growth rate in 2020-2021, Pakistan aims to achieve a 5 to 6 percent growth in the next two years. The government’s stimulus package, combined with incentives to large-scale manufacturing to reduce the cost of doing business, has resulted in a 9 percent increase in the industry in 2020-21. The focus is now on increasing agriculture productivity, reaching out to marginalized segments, and export promotion to sustain the momentum of growth in the country. It says public-private partnerships (PPP) are being encouraged by the government in both infrastructure projects as well as for the delivery of social services. The government has passed PPP acts, corresponding regulations and implementation structures to facilitate private investment for development projects. Almost all transport and renewable energy projects are now being advertised on PPP bases. The government supports private investment through partial guarantees, viability gap funds and securitization of receivables. In order to expand production capacity, increase exports, and generate employment, the government is developing Specialized Economic Zones (SEZs) and Technology Parks. These zones provide tax incentives, security and cost reduction through the provision of utilities, banking, and logistic services. The government is keen to encourage investments in priority sectors like panel manufacturing, medical equipment, material for sustainable housing, and information technology ventures. So far, 21 SEZs have been approved by the Government of Pakistan. The report further says Pakistan’s financial market is vibrant, private sector-led, and offers possibilities of professionally raising capital for SDG investments. If technical assistance is provided and meaningful partnerships facilitated between the Global Investors for Sustainable Development (GISD) Alliance and leading financial institutions, there is potential to structure debt and equity funds of $1billion to finance sustainable projects in priority areas with a direct impact on SDGs. Going forward, it is time to explore a strategic partnership among policymakers, the private sector, technology providers, and international development institutions to expand the pool of development financing and to reach out to the marginalized segments of society. The best way to enter into informal or formal strategic partnership is to structure these partnerships around focused projects and outcomes. Financial sector institutions in Pakistan are well placed to partner with international investors to float SDG bonds or manage sector-specific private equity transactions. A blended financing model with investments from multi-lateral banks, government, and private investors will not only reduce risks, but will also provide shared spaces for mutual learning, it adds. Pakistan has implemented key reforms to improve Ease of Doing Business for existing and new businesses. As a result, the government has started to move away from excessive licenses, inspections and cost in many steps of the business life cycle. Pakistan improved 28 points from 136 to 108 in the World Bank’s Doing Business Report 2020. Now the government is focusing on improving yet another important aspect; contract enforcement and ADR (Alternate Dispute Resolution) for commercial cases. Pakistan has one of the most liberal policies in the region for international investors. The current policies allow for 100 percent ownership of most assets by foreigners, setting up companies without local partnership, expatriation of profits and tax exemptions for greenfield investments. Economic and technology zones are being created to provide maximum facilitation to investors while ensuring security and supply of essential services.