Published On: Mon, Aug 21st, 2017

Malaysia Leads as Pakistan FDI Jumps to 162%

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Pakistan FDIAccording to State Bank of Pakistan (SBP), Pakistan FDI (foreign direct investment) raised from 162% – $85 million in last year up to $223 million in July 2017.

Trade sector got highest FDI in July 2017 of $94 million compare to $1.1 million in the same month last year. Power sector received $57 million compared to $26 million in the corresponding month of last year.

Oil and gas sector received $20 million, construction $20 million and financial business $9.5 million among other sectors.

Pakistan had got $2.41 billion in FDI in the fiscal year ended June 30, 2017, up 5% from $2.3 billion in the previous year. It received $5.4 billion in fiscal year 2007-08, which was the highest amount in the country’s history, according to the Board of Investment.

However, the country has been recording low levels of foreign investment since 2008. Many foreign investors, especially from western countries, have pulled out due to a persistent energy crisis, poor governance and security challenges.

The investors have been skeptical because of the current political instability in the country. In order to observe the foreign investors reaction to the current political scenario of Pakistan, a quarter would be a time period to predict the future of FDI.

Pakistan received a surprised investment of $92 million from Malaysia in July 2017 compared to just $0.1 million in the same month of previous year.

China came at second position with $73 million worth of FDI compared to $24 million in the same month of previous year.

Other notable FDI came from the UAE, which stood at $16.2 million, while $12.2 million came from Japan, $9.6 million from the US and $9.5 million from France.

Chinese investors are pouring in cash in the wake of the $57 billion China-Pakistan Economic Corridor (CPEC), mainly in major infrastructure projects.

Pakistan’s eastern neighbor led the list of individual countries, pouring an investment of $1.186 billion in FY17, up 11% from $1.064 billion in the previous year.

The Netherlands emerged as the second leading country with its FDI at $463 million in FY17 compared to just $29.9 million in the previous year. This came on the back of $448-million acquisition of Engro Foods by Friesland Campina – a Dutch food company.

Turkey came at number three with $136 million investment in FY17 compared to just $17 million a year earlier while France brought in investments of $119 million compared with $95 million in the preceding year.

The power sector received the highest FDI of $795 million in FY17, but it was still significantly lower than $1.159 billion in the previous year.

It was followed by the food sector where the country received $493 million in FY17 compared to net outflows of $56 million in the previous year.

Surprisingly, construction was also among the fastest growing sectors in FY17, receiving a significant $468 million compared to just $46 million in FY16.

The electronics sector also received a respectable $143 million compared to just $34 million in FY16.

About the Author

- An enthusiast working in Dubai as an Assistant Operations Manager. Writing about Pakistan and the latest happenings, trends around the globe is my passion. A dreamer, learner and a major foodie.