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Budget 2018-19 is balanced with many pro-business measures

Pakistan losing business competitiveness both regionally and globally, collective efforts and wisdom can usher well

Interview with Mr Shamim Ahmed Firpo — A leading businessman

PAGE: KINDLY TELL US ABOUT YOURSELF AND YOUR BUSINESS:

SHAMIM FIRPO: I am a self-made person and I feel proud whenever I share my success story to motivate others especially the students. I entered the business field at a very young age. My business journey began in 1968, when I started my food business with the name of “Firpo Restaurant” at Tariq Road Karachi. By the blessings of Allah SubhanahuTa’ala and my mother’s prayers, my business got success and after serving into this dynamic & tempting field, the “Firpo” brand was well accepted by the people of Karachi and Firpo has become part of my name. There may be thousands of Shamims but there is only one Firpo, as whenever the “Firpo” name is taken anywhere across Pakistan, people come to know that it is Shamim Ahmed Firpo.

After getting success in food business, I decided to diversify my business and penetrated into trading and started import and export business with the name of “Sohail Enterprises” in 1975. Now Firpo is a Group of Companies and we have diversified product range. We mainly deal in Auto Lamps & Auto Parts. The core philosophy of our business is to provide “Quality Products with Better Services.”

My sons have joined me in business and our journey is on and Alhamdulillah in 2018 we are going to celebrate 50 Years Golden Jubilee of our business. We always focused on consumer satisfaction with the motto of “Only The Best is Good Enough”. We are well known amongst automobile industry in Pakistan, all the top auto manufacturing industries purchase and use our bulbs for lighting and automotive parts, which we import and some of it we manufacture too. I am holding different public and private portfolios. I am also in business politics and have served the business community of Karachi as President of Karachi Chamber of Commerce & Industry for the year 2016-17 and recently handed over my charge to the newly elected president. I have also served the business community of Karachi as Senior Vice President of Karachi Chamber of Commerce & Industry for the year 2012-13.

PAGE: WHAT ARE YOUR VIEWS ABOUT THE BUSINESS ACTIVITIES IN PAKISTAN DURING 2017?

SHAMIM FIRPO: In my opinion, business environment in Pakistan was not much good during 2017. Political instability affected all economic activities and our economy over all has suffered the most and Pakistan is declining in competitiveness in global markets as well. Our stocks are not performing well since they are down due to uncertain political situation. Exports are also declining day by day and have reached at the alarming level. Once Pakistan was the market leader in textile exports but now Bangladesh and Vietnam have got this position.

Pakistan is among those few countries where political instability has badly damaged the prospects of growth despite the fact that the our beloved country is rich in natural resources and has excellent geographical position. Due to high cost of doing business even we are not able to compete in regional markets. Industrial gas tariff in Pakistan is 73% higher than in Bangladesh, 44% higher than India’s and 12% higher than Vietnam and if we talk about industrial electricity tariff, it is 19% higher than in Bangladesh and India and 41% higher than the tariff in Vietnam. Bangladesh also has low wage rate and Pakistan’s minimum wages is 98% higher than in Bangladesh, 17% higher than in India and 16% higher than in Vietnam. And the minimum wage in Pakistan is also expected to rise ahead than our competitors. Therefore Pakistan’s competitiveness is not expected to improve in the coming years under the present business strategy. Due to all these circumstances, Pakistan’s global ranking in “Doing Business” has dropped to 144th out of 147 countries on the list of the survey conducted by the World Bank.

PAGE: DO YOU THINK THE INCUMBENT GOVERNMENT HAS DONE ENOUGH BEFORE AND DURING 2017 TO HELP THE ECONOMY GROW IN PAKISTAN?

SHAMIM FIRPO: As we all know, the incumbent government is in the 5th year of its governance but the present government has not done enough before and during 2017 for the betterment of business and economy. When the present government took its charge, the business community of Pakistan was hopeful that due to having business background, the government will take positive and bold steps to support business activities in Pakistan but nothing was done like that. Due to present strategies, Pakistan’s exports and foreign direct investment (FDI) are continuously slugging, and trade deficit is on the rise among other factors, and as I shared the most important is that Pakistan is losing out on competitiveness in global markets where price and quality are two top deciding factors. In my option, there is no consistency in economic policies like every previous government, the present government is also working on ad hoc basis. The present government has put no emphases on betterment of economic condition. There must be right and consistent policies so everyone can follow the right direction. At present, everyone is moving and following his own direction. There is no ease of doing business, due to present strategies cost of doing business is increasing day by day. We have lost regional competitiveness because of higher cost of business. Bangladesh, India, Vietnam and other regional countries are doing better than us because they have low cost of doing business in terms of labor and utility charges. So other regional countries are increasing their export day by day and our export is declining day by day.

PAGE: HOW WOULD YOU COMMENT ON FOREIGN AND LOCAL INVESTMENT IN PAKISTAN DURING 2017?

SHAMIM FIRPO: Again I will say that since the day one of this government, Pakistan has been suffering from political unpredictability that is why investors always remained reluctant to invest in Pakistan. Economic growth and political stability are deeply interconnected. On the one hand, the uncertainty associated with an unstable political environment may reduce investment and the pace of economic development. On the other hand, poor economic performance may lead to government collapse and political unrest. In present scenario, CPEC is a good project that will bring positive change in Pakistan’s economy as there are lots of investment opportunities is expected to come under this project but still we are putting IF and BUT on this project due to which we will not be able get true benefits from this project. We all should think in national interest instead of our own interest. Due to these IFs and BUTs other investors are also reluctant to invest as there is no much progress in this project so far.

It is a true fact that political instability lowers local and foreign investment, slows economic growth and gives rise to unemployment and poverty. At present only China has major share in Pakistan’s FDI mostly flowing into power and infrastructure projects. However, despite some increase in foreign investment, the FDI inflows were not sufficient to fully offset the widening in the current account gap.

PAGE: WHAT IS YOUR TAKE ON THE BUSINESS SENTIMENT IN KARACHI DURING 2017?

SHAMIM FIRPO: Karachi is the largest city and economic hub of Pakistan, which is also called revenue engine of the country owing to its contribution of about 70 percent of the total revenue but during the last decade majority of the investors have shifted their businesses in neighboring due to law and order situation and political instability. Karachi is always been neglected by every government while formulating strategies and policies. There is a lack of unity among those how owns Karachi that is why it is suffering and suffering. Karachi is not getting its right share as it deserves. Neither Federal Government has put any intention to progress of Karachi nor the provincial Government. No government is sincere with Karachi.

PAGE: ARE WE AS A NATION MOVING IN THE RIGHT DIRECTION AND SHOULD WE BE HOPEFUL OF BEING AN ECONOMIC POWER IN NEAR FUTURE?

SHAMIM FIRPO: I do not expect anything from the present government but I am hopeful for future as our country is blessed with natural resources, all seasons, excellent strategic position, and economic gateway to Central Asia. So we need to explore our resources and I am very positive that the day will come when our beloved country will be the economic power. As a nation, we only need to move in the right direction we have very bright future we only need honest and sincere leadership and consistency in policies which can put Pakistan on path of growth. There may be economic growth in coming years due to CPEC and non-CPEC related investments and business opportunities and in my opinion these activities will further grow in long term and we will see the trickle down effects of this growth.

Recently, the government has launched Vision 2025,it serves as a detailed road map for the economic revival to address future challenges. It is pertinent to mention here that social stability and development issues are directly linked to the economic sustainability in the country. For smooth journey towards development, it is unavoidable to set aside the democratic process in the country. The need of the hour is to follow an approach which could address the national economic challenges with collective wisdom. In my opinion, no government alone can undertake these reforms. It requires commitment from all the major political parties under the Charter of Economy. They must remember that economic stability and political stability are deeply interconnected. No amount of foreign assistance will push growth unless conditions like a stable and honest government, market-oriented policies, and willingness to undertake reforms are in place. It is not difficult to comprehend what the real issues are.

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