China's outbound investment to Pakistan shows upward trend
BEIJING, August 10 (INP): Pakistan is likely to be one of the
major countries, taking benefit of Chinese outbound investment
flows that may reach 1.5 trillion U.S. dollars over the next
10 years.
It is the part of key Chinese policies, strengthening future
overseas investment, mainly under Belt and Road’s initiative.
Being the part of this initiative, Pakistan could attract a
considerable Chinese investment to complete its future
projects under the China-Pakistan Economic Corridor (CPEC),
says a media report published here.
Net inflow of almost $600 million from China, foreign direct
investment (FDI) in Pakistan surged 38.8% during the last
financial year, according to statistics released by the State
Bank of Pakistan (SBP).
With almost all countries that had traditionally invested in
Pakistan now pulling out their investments, China has
increased its FDI as part of the CPEC.
President Xi Jinping while addressing Belt and Road's summit
held in Beijing assured his country's financial support to the
member countries including Pakistan.
China's outbound investment is set to grow 70 percent over the
next 10 years from a total of 880 billion dollars over the
period of 2007 to 2016, predicted the report published by
international law firm Linklaters LLP.
The outbound investment and acquisitions from China will
continue to be a significant force in the coming years, as
China's long-term policies and initiatives such as "Made in
China 2025" and the Belt and Road Initiative have outbound
deals at the core, the report said.
The "Made in China 2025" strategy, a roadmap released by
China's State Council in 2015 to guide the country's advanced
industrial manufacturing, has seen steady progress in
industrial capability, smart manufacturing, innovation, as
well as product quality and branding.
Proposed by China in 2013, the Belt and Road Initiative
comprises the Silk Road Economic Belt and the 21st Century
Maritime Silk Road, and aims to build a trade and
infrastructure network connecting Asia, Africa and Europe
along ancient Silk Road trade routes and beyond.
According to the report, such initiatives mean that the high
level of outbound investment is likely to be focused on
sectors such as energy infrastructure and high-end technology
and electronics, which may be seen by host governments as
"strategic" to national security or national interest.
This may lead to increased regulatory scrutiny of Chinese
outbound deals from foreign governments.
The report commended the Chinese government's efforts in
supporting the successful execution of outbound deals.
Peter Cohen-Millstein, partner of Linklaters in New York, told
Chinese media that "lessons are being learned both in China
and around the world which will undoubtedly help to reduce
friction and increase deal flow momentum."
INP/JAVED
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