INTERVIEW WITH MR SHER AFGAN MALIK, FORMER MD PIA
Oct 22 - 28, 2012
PAGE: TELL ME SOMETHING ABOUT YOURSELF AND YOUR BUSINESS
SHER AFGAN MALIK: I grew in the country side in a medium sized village. After initial education, I moved to Karachi and obtained Bachelor of Arts degree from Karachi University. Thereafter I completed my Finance and Accounting degree from Institute of Cost & Management Accountants in December 1966. I became an Associate member of ICMA in 1967 and a fellow member in 1972. Although I had enrolled with Karachi University for post graduate degree in Economics but due to my relocation to Saudi Arabia in July 1967, this mission could not be completed.
In Saudi Arabia, I worked for an American Company from 1967 to 1982 and progressed to become Vice President Finance, Accounting, Contract Pricing and Contract negotiations. I left this wonderful Company upon completion of their projects with various U.S. and Saudi Defence Agencies. There after I joined Al-Rashed Group, one of the largest groups in Saudi Arabia involved in many activities. I managed Cement Marketing Div; Transport Div; Steel fabrication Factory and sale of Good Year tyres. I was responsible for a work force of over 1,500 employees and successfully handled a turnover of over 350 Million U.S. Dollars per year. During these years, I dealt with various Multinational Corporations from U.S; Europe, Japan and South Korea.
PAGE : YOUR VIEWS ON PAKISTAN'S TRADE WITH INDIA, CHINA AND BANGLADESH
SHER AFGAN MALIK: World is rapidly changing and free trade is the future in which Pakistan has agreed to be a part of the concept of global village. Myself I am a strong advocate of the concept of free trade and free movement of goods and services from one country to the other. I have seen the benefits of this concept during my 30 years stay in the Middle East. In Pakistan, many business leaders are skeptical and rather afraid of unrestricted imports. AS we are opening our markets to others, there will be adjustments and survival of the fittest concept will prevail but consumers at large will benefit from better products and lower prices. It will be a big cultural change as people are used to restricted policies and they feel threatened from opening their doors. With the passage of time, fruits of free trade will be liked and enjoyed by every one. We must understand that Pakistani goods and services will have access to huge markets in India, China, Bangladesh and other countries. There is a danger for inefficient and marginal businesses to fail but they have time to improve their lot by working hard to improve the quality of their products, lower their costs and be competitive. Some people are scared of dumping from India, China and Bangladesh but these are short term practices and eventually there will be smooth sailing for all. Although I must warn that prevailing shortage of electricity and gas in Pakistan is creating difficulties for the businesses to survive. Government of Pakistan must do their best to rectify this situation and provide energy at reasonable prices so that our industry has a level playing field with foreign competition. During the interim period, businesses must be helped out by the Government so that they can survive. Although I must warn that this help should be for a limited period only.
PAGE: WHAT ARE YOUR VIEWS ON INDUSTRY IN PAKISTAN?
SHER AFGAN MALIK: Pakistani industry is reasonably placed to face the international competition. We have a good mix of new and old plants with lower labour costs. We have to improve the quality of labour by training through Public/Private joint efforts. We must ensure that trained labour is available to ensure quality products and services at reasonable unit cost. Pakistan is lucky to have abundance of raw materials produced in the country. Again I must reiterate that Government can put their act together soon enough and ensure supply of Electricity and gas without interruption at a reasonable cost. Unfortunately law and order conditions in Pakistan are not good enough for businesses to work smoothly and at times to live. This must be corrected on a war footing and we must have complete peace and security for all.
PAGE: YOUR VIEWS ON EXPORT AND IMPORT DURING CURRENT FISCAL
SHER AFGAN MALIK: Pakistani exports are growing and have a further potential to grow. Unfortunately growth in imports has always outstripped exports mainly due to higher energy bill because of huge increase in oil prices. No serious efforts are being made to tap the potential of exports to markets in South America, East Europe, Central Asia, Africa and some Far Eastern countries. Joint and concerted efforts by private sector and related Federal Government authorities are required to tap the potential to these non traditional markets. Moreover, we have to seriously work with United States and E.U. and make them agree to further open their markets for Pakistani products. Pakistan is fighting a war along with the International Forces and has been facing huge economic losses. U.S; E.U; Japan and International Community must open their doors for Pakistani products so that we can stop looking for Aid.
PAGE: YOUR COMMENTS ON MONETARY POLICY AND ITS ROLE IN PROMOTING PRIVATE SECTOR
SHER AFGAN MALIK: Throughout our history, State Bank monetary Policies have been based to control inflation through higher interest rates. If we look back in the past, there is no denying the fact that these Policies have failed. Inflation has been at very high levels and higher interest rates have been a major factor for slow growth of our economy as compared to our neighbouring markets. I can easily point out that inflation was, to a large extent due to supply problems. Shortages of goods and raw material are sometimes due to floods and earthquakes and there must be a mechanism that these shortages must be offset by imports from neighbouring countries or other sources. Recently Central bank has started bringing interest rates downwards and it is a good sign for the business. It will help in economic growth, which will have positive impact on Government Revenues and also more products will be available in the market for domestic consumption as well as for export. Double digit inflation is cancer for any economy and reasonable level of inflation for a growing economy must not be more than 2-4 %. If we look at German and Japanese models of reconstruction and growth after Second World War, they achieved their objectives by strict control on inflation.
PAGE: YOUR VIEWS ON SPECIAL ECONOMIC ZONES IN PAKISTAN
SHER AFGAN MALIK: Development of Special Economic Zones is going to have healthy impact on the Economic development of the country. These zones can be for Industries as well for trade and storage. With the provision of these zones, more industries will be set up and it can create a revolution in the economic growth. There will be more goods and services available and more employment opportunities will be created for young people coming out of schools and colleges. We must ensure that these special economic zones must be in close vicinity of sources of manpower, otherwise it will take much longer to achieve the objectives. We have experienced in the past that Industrial Estates like Nooriabad and few other places could not be successful primarily due to lack of nearby manpower and security.
Pakistan is a wonderful country with lot of resources and raw materials. These resources are available at reasonable cost to Industries, so their products are competitive in the International markets. If managed properly, Pakistan can claim its place in the world within a reasonable period.