The senior representatives of European Union (EU) have given
positive signals regarding investment climate in Pakistan. Kurt Juul EU
Ambassador in Pakistan and the French Ambassador Yannick Gerard while replying
to a question about their observations regarding investment climate in Pakistan
said that their visit and meetings with banking sector, business representatives
and Universities are enough to indicate the confidence the EU has in Pakistan.
Speaking at a Press briefing the two diplomats said that EU
is the second largest investor in Pakistan and desires to further promote trade
and economic ties and cooperation with Pakistan. The current visit to Karachi is
the part of our programme to identify areas of economic cooperation. There were
no sanctions whatsoever from EU against Pakistan over the last 3 years. They
said that it was a misconcept, which has been removed from the minds of the
government as well as businessmen in Pakistan.
They said that EU has got funds for economic cooperation with
Pakistan and other developing countries, the idea behind the current visit to
Karachi is to identify partners in the private sector to go for joint ventures.
Answering to a question regarding volume of investment, which is much larger in
India as compared to Pakistan, the EU ambassador invited the attention of the
questioner towards the size of the market available in India. He however said
that Pakistani businessmen take advantage of the open market in EU countries.
The quality of products always counts. Pakistan has a variety of fruits,
vegetable and other products from manufacturing sector including textile
products. There is no reason why Pakistani fruits and vegetables can find their
place in EU market if they are hygienically fit for consumption. He referred
large size of fish export from Pakistan with the technical assistance from EU.
Similar exercise can also be undertaken for export of fruits, vegetable or other
products to EU, he suggested.
They observed that EU is Pakistan's first partner in trade
and its second partner in investment. Pakistan's exports to the EU's single
market account for 31 per cent of Pakistan's total exports or Euro 2.2 billion.
Trade is now largely in Pakistan's favuor with a surplus of Euro 575 Mio. Under
WTO agreements the EU will remove remaining quantitative restrictions on
Pakistan's textile exports by 2004.
The EU operates one of the lowest average import tariffs in
the world and EU market is open for new exports from third countries as long as
they are competitive and safe to use and consume.
The business climate in Pakistan is of clear interest to the
EU. As Pakistan needs to export to the EU so does the EU need to export to
Pakistan. Our exports to Pakistan have been declining in recent years. So have
European investments in Pakistan. The government's efforts to restructure the
economy are closely followed by the EU and its member states and we hope this
will result in reversal of trends, they observed.
They said that EU-Pakistan cooperation is another important
chapter in our relationship. The EU is the world's biggest donor of grant aid
and this also holds true for Pakistan. The EU's existing portfolio or
development projects is worth in excess of Euro 200 Mio mainly focused on the
all important primary education sector but also giving importance to social
issues such as primary health, rehabilitation of child labour, food aid and aid
to victims of drought, drugs and AIDS. Environmental degradation is also
actively addressed in our cooperation, they said.
Karachi is the economic center of gravity of Pakistan. This
is particularly true as regards trade, the largest part of which goes to
European Union (EU) as exports (31 per cent). Karachi is also the capital of the
province of Sindh and the largest city of Pakistan.
As the important partner it is the EU wants to create more
awareness about itself in Sindh with a view to strengthening its relations
through the Pakistani society. The EU also wishes to become more aware of the
problems and perspectives of this important Province. EU already has strong
links with Karachi. Earlier the EU funded the development of Karachi's fish
harbour. Its fish processing plants are now able to export for Euro 160 Mio to
the EU and elsewhere on an increasing trend. The EU activity supports the Area
Study Center for Europe at the University of Karachi to strengthen academic
ties. The EU funds through grants a number of projects in the social sector:
advanced education for teachers, child labour rehabilitation, women's health and
more generally strengthening the capacities of NGOs. The EU's existing
cooperation programme with Pakistan is worth in excess of Euro 200 Mio.
The present visit follows visits by EU Ambassadors to the
Northern Areas and to Punjab and will include meetings with the Government of
Sindh, the banking and business communities as well as visits to projects.