Economic Diplomacy Essential for FDI

Foreign Direct Investment plays key role in the economic prosperity of any country. In today’s world major powers are busy in snubbing each other through trade tariffs and restrictions. As per latest foreign direct investment trends, the US reclaimed top spot of the countries with highest amount of FDI followed by Switzerland, United Kingdom, Hong Kong, Netherlands, Singapore, Germany, Sweden, Denmark and Canada.

So far Pakistan is concerned, Pakistan’s Foreign Direct Investment (FDI) increased by $151.3m in Sep 2018, compared with an increase of $160.1m in the previous month. Foreign Direct Investment in Pakistan is expected to be $3500.00 million by the end of this quarter. In the long-term, the Pakistan Foreign Direct Investment is projected to trend around $4100.00 million in 2020.

To meet the economic challenges, in today’s modern world, the economic diplomacy not only promotes the state’s prosperity but also, as occasion demands and opportunity permits, manipulates its foreign commercial and financial relations in support of foreign policy. Accordingly, economic diplomacy is a major theme of the external relations of virtually all countries.
At home, economic ministries, trade and investment promotion bodies, chambers of commerce, and of course foreign ministries, are all participants in economic work. Current trends include increasing collaboration between state and non-official agencies, and increased importance given to issues, the negotiation of free trade and preferential trade agreements, and accords covering investments, double taxation avoidance, financial services and the like.

Abroad, embassies, consulates, and trade offices handle economic diplomacy. The main focus is on promotion, to attract foreign business, investments, technology and tourists. Economic diplomacy connects closely with political, public and other segments of diplomatic work. This online course is practice-oriented, and aims at capacity development.
Being strategically and geographically located with improved security situation, Pakistan has immense potential for foreign investment in diverse fields and sectors. Keeping this factor in view, more and more international firms and companies are showing interests in investing in Pakistan.

In this scenario, Pakistani economic managers are also required to pursue the economic diplomacy to attract more and more FDI to bridge the widening trade and current account deficit. In this connection, a close collaboration among all the concerned Ministries and their departments with the foreign missions especially the commercial attaches is very important. Foreign missions and commercial attaches must be given a targets for attracting FDI along with a timeline and their performance must be evaluated; failing people must be called back.

Worthy Readers! February edition of Melange, International Magazine is in your hands to quench your reading thirst. This edition carries a number of articles, special reports, interviews and others which may keep you well informed about the world economic politics.

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