A number of Pakistanis companies have shown keen interest in opening their offices and warehouses in the UK, aiming to boost their exports and expand their businesses, according to UK Director General for Strategy and Investment Ceri Smith.
The businesses want to “use the UK as a platform to go global” Smith, who paid a visit to Pakistan recently, told Business Recorder.
Smith said he met with government officials including State Bank of Pakistan (SBP) Governor Jameel Ahmad as well as businessmen belonging to various sectors including IT, gaming industry, healthcare, textile and construction.
There is “a genuine commitment from the people in positions of influence, a real understanding that actually it’s in Pakistan’s interest to be able to grow the economy and to be able to not only focus on the exports of products, but actually to move further into the value chain around exports of services as well,” he noted.
UK is ‘fantastic platform to go global’
“When businesses reach a saturation point in Pakistan, it’s like, where can you go next?,” he asked.
The answer, according to him, is that “they can invest in expanding their business into the UK. And from there, they can then go on and access European markets, American markets…because we do have those kinds of cultural affinities, providing a kind of a good first point in the internationalization journey for these firms.”
“The UK, I think, is a fantastic platform for people looking to internationalise,” he reiterated.
Pakistan’s IT firm Systems Limited as well as textile firms Khaadi and Sapphire have already expanded their businesses to the UK and are exporting Pakistani goods and services there.
“We are seeing increasing headwinds…And I think it’s really important to work very closely with like-minded allies around the world to try and ensure that we do share the benefits of trade. And I think Pakistan is a trading nation, and I see that as an opportunity for mutual benefit,” he noted.
He said he met half a dozen Pakistani firms that want to expand their businesses overseas. Whether that comes to fruition will depend on how good their business plan is and whether they understand the market opportunities that exist in the UK.
Export-led recovery
UK plans to attract Pakistani investment coincides with ‘Uraan Pakistan’ – a government initiative to boost the economy through exports and achieve sustainable growth in the next five years.
The government has targeted the doubling of exports to $60 billion under the five-year business plan compared to $30.6 billion achieved in the previous fiscal year ended June 30, 2024.
“If you want an export-led recovery, actually making sure that you are setting up subsidiaries and building bases in the UK is an opportunity to really drive forward that export-led agenda,” said Smith.
He also stressed on the importance of deepening the relationship between the UK and Pakistan and “generating profits that flow back through into Pakistan.”
Pakistan and the UK witnessed bilateral trade at £4.3 billion in the fiscal year 2023-24 (FY24) with London exporting goods and services to Islamabad worth £2.1 billion, while the former made imports from the latter worth £2.3 billion in the year. Pakistan is exporting almost 94% goods at zero duties to the UK.
Smith said that through the Developing Countries Trading Schemes (DTCS), “94% of all Pakistan trade is now tariff free…And so those are the kind of things where we can improve the opportunity.”
Responding to a question, he said the UK has emerged as a developed economy worldwide through increasing trades and asked Pakistan to do the same to grow. He said Pakistan should open its economy to global investors and allow free movement of capital across borders to expand the economy.
“The foundation of the UK’s prosperity is on trade,” he said, adding Pakistan clearly understands the importance of trade well..
He said “the long-term future of Pakistan is from being an open economy…you might get some short-term turbulence, but I think (in the) long-term there will be benefits.”
