KARACHI: Confidence of overseas investors has improved significantly to 21 percent since May this year, a survey (wave 15) of Overseas Investors Chamber of Commerce and Industry (OICCI) showed. The 8 percent improvement reflected a major turnaround after negative trends recorded in the last two surveys – in wave 13 and 14- indicating that the business community was once again bullish and increasingly confident of the investment opportunities available in Pakistan. The survey results were largely influenced by retail and wholesale trade sectors which led the upswing with 40 percent positive sentiment, recording a 27 percent improvement against wave 14. The manufacturing sector followed with a confidence level of positive 16 percent showing a substantial net increase of 7 percent, while the service sector at 15 percent net positive sentiment recorded a marginal decline of 3 percent against wave 14 survey. OICCI BCI survey, conducted every six months, is a comprehensive review of both local and global business aspects and is indicative of the direction in which the economy is moving based on the perceptions of key stakeholders of the business community The latest increase of BCS to 21 percent was mainly due to the significantly improved perceptions of global, country and industry business situation during the past six months as well as expected positive industry business situation with increased level of capital investment over the next six months. The views of the survey respondents were largely based on improvement in security, law and order and the overall economy, increased consumer demand, better business alliances, decline in the energy crises and decrease in fuel prices and low inflationary pressure on various other products. The sentiments of leading foreign investors, represented by the OICCI members, who were part of the survey, also recorded an increase, albeit by 5 percent only, to go up to 42 percent from 37 percent in the wave 14 results. Commenting on the highly improved business confidence survey findings, OICCI President Khalid Mansoor congratulated “the government and the business community for keeping faith in the economy of the country and focussing on meeting the growing consumer demand and economic opportunities brushing aside serious distraction and media hype during the past six months”. He further pointed out that “the current positive business sentiment should not be taken for granted as it is strongly co-related with good governance that needs to be supported by a progressive, transparent, consistent and predictable policy framework”. Going forward, Khalid Mansoor advised the government, including the provincial governments to “become more proactive and expedite critical interventions on all issues hindering investment and economic activities including foreign direct investment and exports. There is an urgent need to focus on addressing the country’s very poor rating of 147 out of 190 countries in the recently issued World Bank’s 2018 Ease of Doing Business report, down from 144 in 2016 and way below the 75 rating of Pakistan in 2010.” The sectorial business confidence gauged by the survey reflects that chemical/cement (41%), financial services (30 %), non-metallic (23%) and food (21%) were the growing sectors. A more modest growth was also recorded in transport & communication (12%) and automobile (7%). Metropolitan cities across the country recorded higher business confidence and showed an increase in BCS of 12% in wave 15. The change was mostly driven by Lahore which grew by a significant margin of 47%. BCS in Karachi remained the same while there was a slight decline in Rawalpindi/Islamabad as well as non metros, of 3 percent and 2 percent respectively. Looking ahead, wave 15 survey respondents expressed continuing optimism for the next six months with 60 percent of the respondents believing that the current overall business environment was good or very good, and 57 percent confident about the economy in the next 6 months. Moreover 26 percent, 29 percent and 25 percent respondents were expecting increase in sales, profitability and ROI respectively in the next six months. There was also improvement, as compared to the last survey, in sentiments regarding intention to make new capital investment, mainly because of more optimism on availability of energy, security and stability in government policies, leading to relatively higher demand for products. Published in Daily Times, November 17th 2017.