Saad Amanullah Khan's 2011 ABC Economic Summit Presentation "How to make the Private Sector more Vibrant?"
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I made this presentation for the inaugural session of American Business Council (ABC) Economic Summit in 2011. That year I was the Vice President of ABC and the topic I chose was "How to make the Private Sector More Vibrant". Challenge for Pakistan is the our GDP growth is very poor and the only savior is if our private sectors, specially small and medium businesses pick up.
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Semelhante a Saad Amanullah Khan's 2011 ABC Economic Summit Presentation "How to make the Private Sector more Vibrant?"
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Saad Amanullah Khan's 2011 ABC Economic Summit Presentation "How to make the Private Sector more Vibrant?"
- 1. Unlocking True potential Boosting Pakistan’s Private Sector Saad Amanullah Khan Vice President ABC
- 4. LOWEST INVESTMENT IN 40 YEARS SLOW DOWN IN ECONOMIC GROWTH DISMAL GROWTH IN LARGE SCALE MANUFACTURING UNEMPLOYEMENT ROSE INFLATION ACCELERATED PROVERTY INCREASED FISCAL DEFICIT SURGED FDI (US$ M) DECLINED POST 2007
- 5. …. and more PUBLIC SECTOR BLEEDING PROFUSELY Rs. 450 Billion estimated to be its combined losses
- 6. What is Keeping it NORMAL ? 37o
- 7. CURRENT ACCOUNT DEFICIT TURNED SURPLUS FLUCTUATING YET RISING EXPORTS
- 9. GROWING IMPORTS PUBLIC DEBT as % of GDP EXTERNAL DEBT & LIABILITIES as % of Forex Earnings EXPANSION OF TAX NET
- 12. INLFATION
- 13. Improve Security and Law & Order
- 15. Consistency in Tax & Trade Polices
- 16. Attract FDI
- 17. Only ‘1’ economic indicator guarantees a nation’s long term success … GDP GROWTH RATE guarantees
- 18. GDP Growth has significant impact on “PER CAPITA” & hence “STANDARD OF LIVING”
- 20. - 1.0 2.0 3.0 4.0 5.0 6.0 7.0 60 - 70 70 -80 80 -90 90 - 00 00 -10 08 -10 6.8 4.8 6.9 4.0 4.6 3.2 GDPGrowthRate(%) Gen. Ayub 60 - 69 Gen. Yahya 70 – 72 Bhutto 73 – 77 Gen, Zia-ul-Haq 78 - 79 Gen. Zia-ul-Haq 80 – 88 Benazir 88 - 89 Nawaz 90 – 93 Benazir 93 – 96 Nawaz 97 – 98 Musharaf 99 Gen. Musharaf 00 – 07 Asif Zardari 08 - 99 Asif Zardari 08 - 10
- 21. WITH
- 22. GDP Growth (%) 60 - 70 70 -80 80 -90 90 - 00 00 -10 08 -10 China 3.0 7.4 9.8 10.0 10.3 9.7 India 6.7 2.9 5.7 5.6 7.4 7.9 Pakistan 6.8 4.8 6.9 4.0 4.6 3.2 LEGEND Above 7% 5% to 7% Below 5% +6.5%+4.7% 4 1 1 3 1 2 3 60 - 70 70 -80 China 3.0 7.4 India 6.7 2.9 Pakistan 6.8 4.8 LEGEND
- 23. - 200 400 600 800 1,000 1,200 1,400 1,600 1960 1970 1980 1990 2000 2008 2010 India Pakistan - 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 4,500 1960 1970 1980 1990 2000 2008 2010 China Pakistan Per Capita Current $ Avg. 90 -10 China 10.1 India 6.5 Pakistan 4.3 Avg 60 - 89 China 6.7 India 5.1 Pakistan 6.2 -($500) -($3,400)-($3) +$56 vs. INDIA vs. CHINA vs. INDIA vs. CHINA
- 25. GDP growth rate
- 28. Based on Current GDP Growth rates
- 36. This is the IMMENSE POWER of the Private Sector IF Properly Channeled
- 37. DID YOU KNOW THIS ABOUT PAKISTAN PRIVATE SECTOR
- 38. Last company in Fortune 500: Dia Nippon Printing $17 Billion Largest Pakistani Company: PSO $8.5 Billion Large Indian Companies: Indian Oil $68.8 Billion (# 1) Reliance Ind. $58.9 Billion (# 3) Reliance Industries alone is bigger then all Companies in Pakistan Turkey’s largest company, Koc Holding is bigger then our top 30 Co’s
- 39. German company ‘Volkswagen’ Top 4 Indian companies together THESE ARE LARGER THEN PAKISTAN’s GDP 9 largest companies in the world Top 3 Mexican companies together
- 40. PRIVATE SECTOR AND INDIVIDUAL COMPANIES CAN MAKE THE DIFFERENCE
- 42. But current status is DISMAL 0.2% of Global GDP 0.3% of Global Trade 118/144 in Country Competitive Index* We have a great NATION with rich resources and potential to be GREAT * Dropped 17 positions 2011 vs. 2009 World Economic Forum World’s largest Copper Reserves 2nd Largest Coal Reserves 3rd Largest Cotton Producers 6th Largest in Wheat Production 6th Largest Population 10th Largest Work Force 3 Million workers entering workforce every year
- 45. 21.8% 23.6% 54.6% Agriculture Industry Services GDP Split by Sectors
- 46. HOW IS OUR INDUSTRY & SERVICES SECTOR PERFORMING
- 47. 2 KEY QUESTIONS a) How Developed is this sector b) Is it Organized a) How Developed is this sector
- 48. One way to check if Industry & Services Sector is Under-Developed is when: Agricultural Sector split of GDP is in Double Digits
- 49. Double digit Split: 6 countries > 15% = 3 Countries > 20% = Pakistan ONLY World Largest 30 Economies – Agricultural Split 0% 5% 10% 15% 20% 25% World EuropeanUnion UnitedStates China Japan India Germany Russia UnitedKingdom Brazil France Italy Mexico SouthKorea Spain Canada Indonesia Turkey Australia Taiwan Iran Poland Netherlands Argentina SaudiArabia Thailand SouthAfrica Egypt Pakistan Colombia Malaysia Belgium 1. India 2. Indonesia 3. Iran 4. Thailand 5. Egypt 6. Pakistan 1 2 3 4 5 6
- 50. For any economy with a Developed Industry/Service Sector the AGRICULTURE SPLIT <10%
- 51. 0 50 100 150 200 250 300 350 400 Current Services/Industry Developed 36 36 134 400 Agriculture Services & Industry 9% To Be DEVELOPED Services & Industry has to grow 3 times Agriculture Split of GDP 22%
- 53. 2 KEY QUESTIONS a) How Developed is this sector b) Is it Organizedb) Is it Organized
- 54. - 20 40 60 80 100 120 140 160 180 22 173 166 93 81 74 107 * World Bank website Market Capitalization of Listed Companies as % of GDP Pakistan Organized Corporate Sector extremely Under-Developed @ 22% it DWARFS in comparison
- 55. 550 600 650 700 750 800 2011 2006 2000 637 651 762 # of Listed Company Karachi Stock Exchange (Guarantee) Ltd. 125 LESS Co’s in 10 years
- 56. * KSE Only * 0% 20% 40% 60% 80% 100% 120% Switzerland Netherland Taiwan Australia China India Pakistan 103% 102% 66% 24% 19% 18% 11%
- 57. SYMBOL COMPANY NAME MARKET CAP (Rs) OGDC Oil & Gas Development 734,727,598,572 PPL Pakistan Petroleum 259,489,514,176 MCB MCB Bank Ltd. 173,739,531,529 HBL Habib Bank Ltd. 122,169,247,200 NESTLE Nestle Pakistan Ltd. 107,698,834,688 NBP National Bank Pak. 103,358,443,001 FFC Fauji Fert 85,399,409,730 UBL United Bank Limited 83,525,780,112 PTC P.T.C.L.A 73,291,080,000 POL Pak Oilfields 70,008,130,483 ENGRO Engro Corporation 63,518,664,557 ULEVER UniLever Pak 57,963,576,760 ABL Allied Bank Ltd. 54,864,373,505 PSO P. S. O. 50,629,155,528 HUBC Hub Power 43,289,146,104 SYMBOL COMPANY NAME MARKET CAP* (Rs) GOVERNMENT OWNED ENTITIES ACCOUNT FOR 66% OF TOP 15 FIRMS * Dec 2010
- 58. In Pakistan:
- 59. Organized Sector UnorganizedSector Why ? 1. Too Regulated ? 2. High Taxation ? 3. Difficult govt. polices & procedures ? 4. Political will ? 5. ….. Estimated to be 2 to 3 times organized
- 61. PRIVATE SECTOR IS THE FIRE THAT WILL DRIVE OUR ECONOMY
- 62. We need to address the 3 C’s: 1. What govt. policies will help drive ‘corporatization’ ? 2. What do we need to do to become ‘competitive’ ? 3. How to gain ‘confidence’ of businessmen & investors?
- 64. NOW YOU KNOW
- 66. WE HAD A PROGRESSIVE ECONOMIC OUTLOOK Pakistan was called out amongst “THE NEXT 11” by Goldman Sachs Research in 2005
- 68. WE MUST DRIVE DOUBLE DIGIT GDP GROWTH FOR A FEW DECADES 1. Having a Clear Vision & Select Strategies 2. Robust Corporate Governance Structure 3. Conducive Government Polices 4. Invest in Human Capital & Resources 5. Simple & Easy Financing Available
- 73. THANK YOU