Article by Maria Paula Tolentino
With context and photos provided by Stephen Araneta
Manila – 28 November 2019 – OLLI Consulting Group Inc. Principal Atty. Leo Dominguez and Government-Industry Alignment Consultant Stephen Araneta met with key members of the Pakistan trade mission led by Pakistan’s very own investment lead, Mr. Ali Jehangir Siddiqui.
Siddiqui has made a name for himself both as an entrepreneur and diplomat. He is an experienced businessman who helped set up various companies such as Airblue, the second largest airline in Pakistan; Arabian Gulf Steel, a steel producer in the UAE; Jura Energy, a Canadian oil and gas company; and RAK Ghani Glass, the largest pharmaceutical glass producer in the UAE and GCC countries. He also served as Pakistan’s Ambassador to the United States in 2018 and is currently serving as Pakistan’s Ambassador for Foreign Investment in an Honorary Capacity. At just 42 years old, this man continues to champion his country as an investment destination and is keen to tap the Philippine market.
The OLLI Consulting Group together with the Chairman of AG&P and Country Chairman of Oceana Gold Philippines Inc., Jose Leviste Jr., had the rare privilege of sitting down and talking economic diplomacy with Siddiqui and his colleagues: Ahmed M Saeed, ADB Vice President; Werner Liepach, ADB Director General, Central and West Asia Department; and Shahid Mahmood, ADB Alternate Executive Director.
The meeting covered key industries in Pakistan: Agriculture, Power, Mining, Franchising & Retail and Pakistan’s interest to invest in the Philippines
According to Siddiqui, Pakistan’s main crops are rice and wheat and grows apples, apricot, oranges and a wide variety of mangoes. However the industry experiences 30%-40% in losses due to the lack of technology in processing and supply chain management. Pakistan is currently looking for Philippine companies to invest and address these concerns.
Siddiqui says there is much opportunity for renewable energy, specifically wind and solar. Pakistan currently has Nuclear power and is setting up new plants near Karachi. However, distribution losses are high. They want to set up more power plants to be near the target consumers. As power resources become competitive, upfront tariff is being reduced over time. Pakistan is offering low debt-financing interest rates at 8%. Coal is also another power source and quite indigenous to Pakistan, though the quality is not that high. The country has 250B tons of coal reserve in total.
Pakistan is a country rich in reserves of Copper, Gold, Uranium and Zinc. Siddiqui says there are no restrictions to foreign ownership of land. Land ownership is structured as a long term lease, and as a requirement, the foreign company should be locally registered. Though the tax regime is unclear, Siddiqui mentioned that Barrack Gold winning an arbitration in the supreme court vs the Pakistan government is a good case study.
Franchising / Retail
With a population of 220M, Siddiqui says that there is potential for snack food manufacturing and distribution. He cited that Frito Lay recently invested in Pakistan and that there are reputable families in Pakistan wanting to enter the franchising business.
Pakistan Investing in the Philippines
Siddiqui adds that Pakistan currently manufactures pharmaceutical glass and is looking for markets for this product. Dominguez mentioned that there is a huge market in the Philippines since the country is trying to lessen and eventually replace single use plastic. Glass could be that option. On energy, Dominguez brought up the possibility of supplying power in the BARMM region, which Siddiqui was receptive to. Their only parameter for investment would be the scale of development. Siddiqui mentioned that Philippine business tycoon Ricky Razon is an investor of Pakistan.
At the conclusion of the meeting, it was decided that a Philippine trade delegation to Pakistan will be organized come February 2020.