ISLAMABAD: As Pakistan adapts to a dynamic global economy, partnership with China offers avenues for prosperity. By adapting to China’s evolving agenda, Pakistan can drive sustainable growth and become a key beneficiary for years to come, said Dr. Liaquat Ali Shah, Head of Policy at the Center of Excellence for CPEC, in an interview with WealthPK. “China’s rise as a global economic power has ushered in a significant realignment of global economic forces and relationships.
As China has become a leading exporter of goods and services, its significant demand for raw materials and other inputs has catalyzed economic growth in many countries. It has changed the way countries interact economically, affecting trade patterns, supply chains, financial markets, and geopolitical dynamics on a global scale.
The policy leader said: “If developing countries like Pakistan want to fully benefit from China’s transition, they need to understand what the ‘New Normal’ entails. Amid China’s shift towards a consumption-based, service-oriented growth model in the current economic environment, Pakistan has a compelling opportunity. “To tap into this potential, Pakistan needs to strategically align its manufacturing capabilities with the evolving demands and preferences of the Chinese market.
This will position Pakistan to access and cater to the expanding consumer base in China,” he said. He suggested that Pakistanis engage in collaboration with their Chinese counterparts to effectively address regulatory issues, streamline business processes and promote cultural exchanges. Pakistan must understand Chinese consumer preferences and market trends and be able to skillfully adapt Pakistani products to meet the demands of the Chinese market.
Speaking to WealthPK, Malik Sohail Hussain, Coordination Chairman, Federation of Pakistan Chambers of Commerce and Industry (FPCCI), said, “For many years, Pakistan and China have shared a strong and enduring bond, exemplified by their strong trade relations. As Pakistan strengthens its trade partnership with China, it opens avenues for strengthening economic ties with Central Asia.
This strategic tie-up has not only strengthened Pakistan’s regional influence but also underlined its potential as a key player in the global market. He said Pakistan stands at the threshold of immense opportunity, driven by its diverse market dynamics. Harnessing this diversity is key for Pakistan to unlock its full economic potential. Creating a joint venture (JV) with an international partner could bring strategic benefits such as cost reduction, access to global markets, increased competitiveness and acclimatization to the distinctive global business climate.
“Joint ventures with China across specific sectors hold promise not only for economic growth but also for job creation. China’s continued focus on mines and minerals has drawn attention to Pakistan’s rich natural resources, paving the way for significant cooperation and investment opportunities. With China’s high demand for raw materials to support its industrial expansion, Pakistan can benefit immensely from enhanced trade relations and partnerships in the mining sector,” Sohail said.
He claimed that China has invested huge sums in infrastructure development of the region, especially in South Asia. All these events indicate that the region will experience economic integration and ultimately a transformation of political integration. China has taken some measures, including expanding institutional opening, reducing restrictions on foreign investment, improving the business environment, improving market access, improving regulatory transparency, and committing to fair competition, which has provided promising prospects for foreign investors.
In the latest development, the State Council or Cabinet issued in December 2023 a comprehensive plan to promote the institutional opening of China’s (Shanghai) Pilot Free Trade Zone (FTZ). A total of 80 measures were outlined in the plan, including initiatives to facilitate trade in goods and services, promote digital trade, and strengthen the protection of intellectual property rights, among others.
On January 1, 2020, China implemented the landmark Foreign Investment Law, which includes a comprehensive and basic set of legal standards for foreign investors and aims to better protect their rights and interests. The country is also actively seeking to continually lower the threshold and reduce the costs and risks associated with foreign investment. China’s expanded opening-up agenda presents a compelling opportunity for Pakistan to accelerate its economic development and strengthen its ties with key partners.
