Foreign direct investment dips 21pc
After a drop in both remittances and exports, foreign direct investment (FDI) fell 21 per cent in the 11 months through May, though inflows in May rose on both month-on-month and year-on-year bases. The State Bank’s data issued on Tuesday noted an FDI inflow of $149.6 million in May compared to $121.6m in April 2023 and $141.2m in May 2022. Due to prolonged political and economic uncertainties, there was little hope in the financial circle for improvement in foreign investments. For more than a decade, Pakistan has lost attraction for foreign investments. The current economic turmoil has badly damaged the country’s image as an attractive place for investments. Moreover, the serious shortage of foreign exchange reserves turned ugly when most companies failed to send their profits and dividends out of the country. The government held back at least $1 billion in profits from foreign investments. This is important because already only a few countries are investing in Pakistan, while China has been the biggest investor for years.