The economic benefits of the CPEC
At present, the overall plan of the China-Pakistan Economic Corridor has been completed. The Pakistani business community is also ready to work with China to advance the grand “Belt and Road” initiative.
The “One Belt, One Road” is an international development plan proposed by China. As part of it, the China-Pakistan Economic Corridor will build a modern Silk Road.
The key to creating a corridor
The China-Pakistan Economic Corridor has brought together many investment plans to fill Pakistan’s energy gap, revitalize the poorly-suffering industrial base, and provide loans.
This construction project aims to create the first north-south link between the “belt” and the “road,” and the confluence point is Gwadar Port. Therefore, this port is undoubtedly the key to China-Pakistan Economic Corridor.
The picture above shows the four key pillars of investment in the China-Pakistan Economic Corridor: Gwadar Port, energy projects, infrastructure construction, and industrial cooperation.
Business readiness for change
ACCA surveyed 500 accounting professionals across Pakistan. As a result, 79% of respondents believe that in the next five years, their companies will consider the changes brought about by the China-Pakistan Economic Corridor when formulating business strategies and appropriately adjust their business development methods based on expected growth and changes.
The survey clarified the direction of the company’s transformation:
1. Companies need to consider and analyze the global impact of the “Belt and Road” initiative and its impact on the way of doing business in Pakistan;
2. Effectively allocate resources to participate in global competition;
3. Companies in the information technology and communications industries need to consider major investments in human and organizational development to participate in global competition and promote collaboration between Chinese and Pakistani technology companies.
4. Geopolitical influence should be included in the business risk assessment. It will be very difficult to compete with Chinese companies in terms of production costs. In addition, with the continuous construction of infrastructure connecting the two countries, Pakistan’s trade with China is expected to grow, which will inevitably intensify the competitive pressure faced by local products. Therefore, it is necessary to make corresponding adjustments to the risk management mechanism to detect possible commercial risks promptly.
Financial skills needed in the future.
To take full benefit of the changes that the China-Pakistan Economic Corridor will bring, Pakistan’s financial professionals need to possess a range of skills, including better communication skills (the choice of 68.7% of respondents) and better business analysis skills (66.1%); In addition, 52.2% and 52% of the respondents believe that tax knowledge and leadership are also important to them.
Finance and business professionals should make the following preparations to prepare for future business growth:
1. Understand how changes will affect their lives and businesses;
2. Learn from the current “early harvest” project;
3. Consider what new skills need to be mastered to make better use of improvements in infrastructure;
4. Visit China and inspect relevant Chinese companies;
5. Develop detailed future strategies based on the long-term impact of the China-Pakistan Economic Corridor.
6. Think carefully about cross-border trade, Chinese culture, and moral values.