BEIJING: Pakistan has emerged as a major beneficiary of Belt and Road Initiative since it helped the country to improve its macroeconomic conditions and maintain a momentum of rapid growth during the last five years.
According to a report, published by China Economic Net, over the past five years, Pakistan’s GDP grew by an average of 4.77%, especially in the 2017-2018 fiscal year when Pakistan’s GDP grew by 5.8% — highest growth ratio in the past 13 years.
Pakistan’s annual foreign direct investment grew from US$650 million to US$2.2 billion, and the per capita annual income rose from US$1,334 to US$1,641.
CPEC has solved the problem of limited investment capacity caused by insufficient savings and shortage of foreign exchange in Pakistan and provided a high-quality source of impetus for Pakistan’s economic development.
As of January 2019, CPEC included 9 completed early harvest projects and 13 projects under construction, with a total investment of US$19 billion. It drove Pakistan’s economic growth by one to two percentage points every year and created 70,000 jobs in Pakistan.
The Chinese government provided US$5.874 billion in concessional loans to Pakistan, with a consolidated interest rate of only 2%, far lower than the average interest rate. The Chinese government also provided US$143 million in interest-free loans for the Gwadar East-Bay Expressway project and free assistance for some livelihood projects in Pakistan.
According to the report, CPEC has played a flagship leading and demonstration role in the “Belt and Road” construction. It has become a platform for all-round pragmatic cooperation between China and Pakistan.
China’s support also helped a lot to overcome its economic crisis. The electricity gap was costing Pakistan an annual average loss of US$13.5 billion in GDP, according to a study by PwC in 2012.
CPEC has regarded the alleviation of energy shortage in Pakistan as one of the important areas of construction since its launch. Currently, 12 projects with a total installed capacity of 7,240 MW have been commenced or put into operation.
Gwadar Port has taken on a new look in the past five years. The port roads, storage yards, loading and unloading equipment, seawater desalination, oil supply and port monitoring facilities have been further improved.
More than 30 Chinese and Pakistani enterprises, including hospitality, banking, insurance, financial leasing, logistics, overseas warehousing, grain and oil processing, fishery processing and home appliance assembly, started working at the free zone. The direct investment exceeded RMB3 billion.
These facts were particularly highlighted at a seminar, recently arranged by the China Economic Net.