Qudsia Bano

Pakistan needs large scale public and private investments, as the development outcomes have not kept up with its income growth. The current favorable economic climate affords the country a chance to overcome the structural bottlenecks that are preventing it from achieving its enormous potential.

This is the outline of an exclusive interview by WealthPK with Spinzer Equities Pvt. Ltd’s Chief Executive Officer (CEO) M Liaquat Ali in which he gave an honest analysis of the state of Pakistan’s economy. The following are the details of the interview.

Q: How your firm may be impacted by its increased vulnerability to changes in the economic and political landscape as well as other external factors, and how you are handling them?

A: Businesses serve as the cornerstone of local, regional, and national economies; therefore, when they are disrupted by disasters or political landscape, not only do they suffer direct commercial losses, but also indirect losses and wide-reaching consequences for economy leading to job losses that have a negative impact on earnings and make it even harder for households and communities to recover from catastrophes. Pakistan is experiencing an extensive political unrest, which has a detrimental impact on its economy, and resultantly every sector is affected by this landscape.

Q: What do you think the market sentiment is in light of Pakistan’s economic situation?

A: This year, the country faced unheard-of difficulties and problems. Lack of corporate activity is a result of an unstable capital market, decreasing Pakistani Rupee, growing inflation, and uncertainty on the political and economic fronts as well the floods. When compared to its closing value of 47,356 points on June 30, 2021, the equity market index showed a 14% downward trend and finished at 41,540 points on June 30, 2022. The Consumer Confidence Index in Pakistan increased from 31.6 in July to 34.5 in September 2022, which was the lowest reading since September 2012 when the nation was severely devastated by floods brought on by above-average monsoon rains and melting glaciers. Both the current and expected economic conditions received lower negative ratings.

Q: Who crafts your company's investing policies, and how do you aim to protect the value of your investment portfolio from possible market risks? 

A: The Board of Spinzer Equities has established efficient risk management, human resource & remuneration, and audit committees, authorized their respective terms of reference, and provided the committees with sufficient funding to carry out their duties effectively. To improve and standardize corporate decision-making, the board or its committees are provided with all key topics during the year. Prior to the board's meetings and those of its committees, the board receives prepared agendas and accompanying materials in plenty of time. Independent and non-executive directors participate equally in key decisions. The board has always given compliance with the applicable laws and regulations top priority and used its authority in line with the applicable laws and regulations.

Q: What are the major causes of economic instability in the country, and how we can improve it?

A: Pakistan's falling potential and actual economic growth during the previous decades can be attributed to declining worker productivity and low capital accumulation. Pakistan must increase its investments to address its major problems. The current favorable economic climate gives Pakistan the chance to overcome structural bottlenecks that are preventing it from achieving its enormous potential supported by a sizable, young, and expanding population. To achieve the ambitions of its population and boost the nation's competitiveness, large public and private investments are required as the country's development outcomes are not in step with its income growth.

About the company

Spinzer Equities is among the top brokers in the market, particularly in Islamabad. It invests in companies with ambitious business plans that work in industries like healthcare, education, FMCG, real estate, logistics, and technology. With a proven management team, a strong market position, and a clear plan for value creation through both organic development and acquisition, Spinzer Equities focuses on investing in growth areas.

Credit : Independent News Pakistan-WealthPk