INITIATIVE TO UPGRADE COMPETITIVENESS
OF PAKISTAN’S ECONOMY
Arthur Bayhan
Chief Executive Officer
Competitiveness Support Fund (CSF)
World Economic Forum - Global Competitiveness Report (GCR)
Improving Pakistan’s Competitiveness
Improved
Competitiveness
Sustained
Economic
Growth
Poverty
Reduction
Globalization is a reality that
countries can no longer escape
Competitiveness is the only way to
benefit from globalization and not
become a victim
Competitiveness Support Fund – Pakistan
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World Economic Forum - Global Competitiveness Report (GCR)
Improving Pakistan’s Competitiveness
Improved
Competitiveness
Sustained
Economic
Growth
Poverty
Reduction
The World Economic Forum’s Global
Competitiveness Report Is the Most Influential
Ranking of Country Competitiveness and Effects
Pakistan’s Image in the World Among Business,
Government and Financial Leaders
Understanding and Monitoring the Rankings is
Important
Improved Competitiveness Leads to Sustained
Economic Growth Which Has Proven to Be Effective
in Poverty Reduction
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World Competitiveness Ranking 2006
(Total 125 Countries)
FINLAND - 2
USA - 6
S. KOREA 24
THAILAND - 35
JORDAN - 52
India - 43
S. Africa - 45
China - 54
KAZAKHSTAN - 56
TURKEY - 59
PAKISTAN - 91
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Global Competitiveness Index
Components for 2006: Pakistan
•
•
•
•
•
•
•
•
Institutions=
Infrastructure =
67
Macro economy =
Market efficiency =
Technological readiness =
Innovation =
Business sophistication =
Education =
Competitiveness Support Fund – Pakistan
79
86
54
89
60
66
104
5
Global Competitiveness Index
Components for 2006: Pakistan, India, Thailand
•
•
•
•
•
•
•
•
Institutions=
79
Infrastructure =
Macro economy =
Market efficiency =
54
Technological readiness =
Innovation =
60
Business sophistication =
Education =
Competitiveness Support Fund – Pakistan
34
67
86
21
89
26
66
104
40
62
31
31
55
33
25
49
38
88
48
40
42
6
Global Competitiveness Report Has Two Indices
Pakistan ranked 67th on the Business Competitiveness Index of Michael Porter
Pakistan ranked 91st on the Global Competitiveness Index up from 94th place in 2005
Lower rankings on the GCI reflect inclusion of low health and education indicators
Global Competitiveness Index (GCI)
Business Competitiveness Index (BCI)
Rank
Rank
120
120
108
100
100
91 94
100
80
65
64
72
60
79 80
80
67 67
57
60
43
40
27
45
54
48
40
31
20
20
0
0
India
99 98
China
Sri Lanka
Pakistan
Bangladesh
India
China
Sri Lanka
Pakistan
2006
2005
Source: World Economic Forum, Global Competitiveness Report, 2006-2007
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Bangladesh
CSF Action Plan to Improve Pakistan Ranking on Global Competitiveness Index
Pakistan Can Improve by 6-8 Rankings Per Year
Rankings Can Improve to 60-65 by 2010
63
70
RANKING
77
50%
84
44%
91
38%
33%
27%
2006
2007
2008
2009
2010
YEARS
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CSF Action Plan to Improve Global Competitiveness Index Rankings
Improving Pakistan’s Competitiveness
CSF Action Plan: Next Steps
1. Promote Broad Understanding and Support for Government’s
Economic Reform Agenda
• Provincial Government Leadership Workshops
• Presentations on Competitiveness to Business Leaders
• Orientations for Local and International Press
2. Communicate Priorities to Relevant Ministries and Institutions
and Ensure Timely Provision of Data to International Sources
3. Ensure Accurate Implementation of Executive Opinion Survey
for Next Global Competitiveness Report – March 2007
4. Focus CSF Activities on High Impact Areas
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Operational Windows of the CSF
Competitiveness
Support
Fund
Technical
Assistance:
Sectoral and
Regulatory
Matching
Grants:
Cluster
Development
Competitiveness Support Fund – Pakistan
Business Incubators/
Venture Capital
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Technical Assistance Window
1.
Prepare and publish First Annual State of Pakistan’s
Competitiveness Report
2.
Carry out Competitiveness Analyses to Recommend Specific
Actions with High Potential Impact Beginning with:
–
–
–
–
–
3.
Motorcycle industry
Food processing sector
Fishery
Automotive industry
Gender contribution to economic growth
Increase Public Awareness of Innovation and Competitiveness by
Better Preparing Journalists in Cooperation with Stanford
University Innovation Journalism Fellowship Program
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CSF PARTNER ORGANISATIONS
CSF Has Signed MOUs for Cooperation With:
•
HEC:
•
PARC: Agribusiness
•
Government of Sindh: Cluster Development
•
World Economic Forum
Commercialize Research for
Knowledge-based Enterprise
Development
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Matching Grant Window
•
Main Criteria:
–
–
–
High potential to generate jobs, income, exports
and investments
High potential to improve quality of products and
services
Benefits a “cluster” of firms in an economic
sector
•
Amounts: US$20,000-US$125,000 (catalytic
investments triggering large potential impacts)
•
Co-Financing Requirement: 50%
•
Participants: Private Sector, Government and
Academia: “Triple Helix”
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Matching Grant Window
CSF Uses the "Triple Helix” Approach
CSF Uses the “Triple Helix” Approach
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CSF-HEC Joint Initiatives
• Commercialize applied research and link private sector
with university research
– 20% private industry, 30% HEC and 50% CSF
• Promote knowledge-based enterprise sector by
facilitating international patent registrations from
Pakistanis and Pakistani institutions
• Organize for first time trade fairs highlighting science
and technology-based projects developed at
universities to attract private-sector investors looking
for innovative products and systems to commercialize
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Business Incubator Window Concept
Incubator Set-up
GOP (Min. of Ind.)
Fin)
Funds for Business
Incubation
Bilateral Agreement
Application
IBA/University/
LUMS/IBA/Uni
versity/
Pub
-Pvt. Consortia
Approval
50%
contribution
Bilateral
Agreement
with TOR
50% contribution
• Details of investment and
contribution by applicant
institutions
• Industry Specialization
based on local competitive
advantage
• Annual Targets/output
• Commitment for outcome
• etc
Business
Incubator
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Business Incubator Window: Operations
Business Incubator
Board of
Directors
Potential
Potenti
Incubate
al
es
MANAGERS
Detailed Joint 2 yr.
Proposal with
Funding & ValueAddn.
Requirements
Approval
Funding
$ 15,000– 150,000
2 Year
Incubation
Period
Graduate after 2 yrs.
Create Commercial Entity
With 85% B.I.
Reclaim company
Board
Ownership
ownership after
Business Incubator Services
• Links to industry, universities,
research institutes
• Business support services to
enhance and develop business
• Daily hands-on managerial
mentoring (general
management, finance,
accounting, marketing,
production, R&D)
• Financial resources for R&D
and initial marketing expenses
• Access to potential private
investors and strategic partners
• Training and coaching on
dealing with the potential
foreign investors and strategic
partners.
share buyback
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