KARACHI: Pakistan’s Business Confidence Score (BCS) fell to negative 4% in September-October 2022, compared to positive 17% in March-April 2022, the Overseas Investors Chamber of Commerce and Industry (OICCI) announced on Wednesday.
OICCI’s Comprehensive Business Confidence Index (BCI) Survey – Wave was conducted from September 22 to October 2022 across the country.
It revealed that the biggest decline in confidence was recorded in the “services sector” (24%), followed by the “retail and wholesale trade” (22%) and the manufacturing sector (20%).
The survey sample comprised 42% of respondents from the manufacturing sector, 33% from the services sector, and 25% from retail/wholesale trade.
Despite recording a significant decline in confidence of 20%, the manufacturing sector recorded a net confidence level of positive 3%, while the services and retail sectors remained at negative 8% and 14% respectively.
Commenting on the BCS, OICCI President Ghiyas Khan said, “The significant decline in overall business confidence to negative 4 percent is regrettable but surprising given the extremely challenging political and economic environment during the last six months. do not have.”
Apart from high inflation and rising fuel prices, significant currency depreciation also affected economic activity.
“Record-level rains during August have further restricted business activities due to severe flooding in Sindh and other parts of the country,” he added.
The OICCI BCI survey, conducted face-to-face periodically in nine cities across the country, gives heavy weightage to key business hubs of Karachi, Lahore, Rawalpindi-Islamabad, and Faisalabad, covering 80% of GDP. is done
The OICCI survey feedback covers the business environment at the regional, national, sectoral and enterprise level over the past six months, as well as the expected business and investment environment over the next six months.
Overall, more than half (56% vs. 19% in the previous wave) of survey respondents were negative about the business climate in the past six months, and going forward only a net 2% (vs. 18% in the previous survey) were negative in the next. were positive for six months.
Commenting on the business outlook for the next six months, OICCI Vice President Aamir Pracha said, “These are challenging times, and the authorities are doing everything possible to meet the major challenges that lie ahead, including managing inflation, limited availability of foreign exchange and resources. Trying as possible. Obstacles.”
He added that key stakeholders, especially foreign investors, will continue to support the authorities in taking long-term policy measures to smooth economic fundamentals, including fair taxation for all, and business and investment in the country. Making things easier.
Sentiment among OICCI members, leading foreign investors, who were randomly included in the survey, stands at a positive 6%, down from a positive 33% in the previous wave. Foreign investors have shown more confidence than non-members in the past as well.
Commenting on feedback from OICCI members’ survey, Ghiyas Khan observed that “foreign investor sentiment could have been more positive but unnecessary delays in pharma price revisions and overseas shipments of goods For serious concerns on some important issues such as extreme delay, services, and profits”.
Such measures were seriously detrimental to attracting foreign direct investment in the country. He said that the survey identified three major threats to business growth, namely inflation (78%), high taxes (71%), and currency devaluation (70%) as the main threats to business in Pakistan. Can potentially slow down growth.
Looking ahead, only 18% (34% in Wave 21) expect to expand business operations, 2% (21% in Wave 21) plan new investments, and 7% of respondents (in Wave 21 A positive 16%) expect employment to increase. their respective businesses.
