Talk by Ayla Majid @ The Future Summit

Assalamu alaikum everyone. So Belt and Road is a very interesting project that we in Pakistan have been talking about since 2013. A lot of people have speculations, unanswered questions, and see it as an opportunity. Here representing ACCA, I'll share the broader context of what is One Belt One Road, then talk about one of the corridors, the China-Pakistan Economic Corridor, and what people think about it. ACCA has done considerable work on this. ACCA is a global body of accountants, almost 200,000 members around the globe, present in 24 of the 60 plus Belt and Road countries. We figured we need to move with the new world economic order, so we've been doing a lot of research. I'll share findings from two reports: 'Belt and Road Initiative: Reshaping the Global Value Chain' and 'Opportunities in Pakistan and particularly around the CPEC corridor.' So what is One Belt One Road? There are five priorities: global trade, policy coordination, people-to-people relationship, and connecting infrastructure. Infrastructure is the most important to create linkages. Belt and Road affects about one-third of the world's GDP and two-thirds of the global population, connecting 4.4 billion people in over 60 countries. The map shows six corridors, including the China-Pakistan Economic Corridor. It is about rebalancing the global economy, the new economic order, and promoting globalization. Millennials do not believe in boundaries, and this is what they want. Bulk of this is about creating infrastructure. McKinsey has predicted global infrastructure needs of about $50 trillion till 2030. I'll link this with CPEC. Obviously, there are geopolitics, but even if it is geopolitics, it's majorly about geoeconomics. There are concerns about China becoming the largest economy, but we need to think differently. There are external challenges like market instabilities, competition, turmoil, trade protectionism, but overall we see positive things. Moving on to CPEC: we've been hearing the magic number of $46 billion. In the global context, that's only 0.13% of the $50 trillion needed. Pakistan's infrastructure index is close to Nigeria's. We need to invest. Bulk of this infrastructure development is through public-private partnership. The major chunk is energy, then roads, transport, rail, and economic zones. It will create about 700,000 to 800,000 jobs and increase Pakistan's economy by 2.5%. ACCA interviewed 500 companies: 79% said it's part of their five-year plan, 86% want to learn the language. There are challenges, but strengths include human capital, natural resources, strategic location. Opportunities include public-private partnership, job opportunities, outsourcing. The biggest weakness is lack of awareness, so we are having this discourse. There are concerns about transparency and environmental degradation, but strengths and opportunities outweigh threats and weaknesses. I encourage you to ask yourself how this will affect your life and organization. We need to learn new skills, prepare human resources, and engage with experts. Think ahead. The entire project is about inclusive growth, not just economic but social. It's about creating a more harmonized and peaceful world. We want to co-exist and create a better humanity. Thank you. Happy to take questions.

I think it's a very simple answer: the private sector and the people of the country. Everybody has got an opportunity in this whole pie. It is about increasing your business, your trade, your access to global markets, and also benefiting financially, economically, and in terms of human capital development.

I think I would go back to something that I said a little bit earlier. How is the world moving forward? How do people integrate with each other? Do we really want a world where countries are apart, people are apart? Obviously everybody needs to look at their own interests, but globally, how is the world moving forward? People need to be connected. They want to be at peace with each other. I personally do not see this as China's attempt to take over. China cannot build this entire project on their own. It is about China's partnership with many different countries. It is about inclusive growth. I personally don't feel even the slightest bit of threat. What we need at the country level is a good regulatory framework and the right kind of policy. But we cannot let inertia hold us back. We need to overcome this inertia and turn this threat into an opportunity.

Thank you so much for calling it a perception, because it is very much a perception. I'm glad you asked this question because a lot of people feel that. If in a project Chinese people are working, I don't see that as a problem as long as they bring the skill set. You mentioned that there are prisoners working. How does that affect your life? Personally, I don't think that would affect your life as long as those people are regulated. That's again a perception. And when we talk about coming from a culture which is not so open, we've got our own culture, but we've got to be open to let others have their own culture. When I've asked various Chinese people how they see their interaction with people from other parts of the world, they do not want to impose their culture at all. I was at a similar conversation in the Middle East last month, and a Chinese professor was asked the same. He said we don't differentiate people on the basis of being Muslim or Jew or any other religion. We want our own interest in terms of economic growth and inclusive growth. A lot of Pakistanis and Muslims are working in different parts of the world in sync with the rest of the world and have been great success stories. We need to open our minds and break these mental barriers. Explore more and do away with these mental barriers. Increase your knowledge and look at whether these perceptions are created by the media or what is your own linkage. Are you being affected? I'll leave you with that.

Yeah, I'll just very briefly add one thing to this. We really need to rethink our education infrastructure and model. We need to produce leaders for tomorrow. When the future is changing, the existing enabling environment of the education system may not be fit for the future. So we need to continuously think and evolve in that domain.

All right. Okay, so you know, first of all, we need to look at what we have to offer. Have we invested enough? Have we diversified enough in our own industry? What do we have to offer to the rest of the world in terms of competitive products and services? There are certain sectors where Pakistan has its strength, but we need to look inward. Regardless of China, Pakistan's exports have gone down because the world has evolved in production, bringing down costs, having access to global markets. If we do not stay relevant, it is not just CPEC, but we can face threats. I'll give you an example of Nokia. Nokia started with making wood cutting machines and became one of the finest engineering models and developed phones. How many of you use Nokia phones? A few people. Less than a percent. Companies, countries, people, if they want to stay relevant, they need to invest in themselves. Now coming back to the industry, how Pakistan industry will be affected: we need the right kind of policy framework and regulatory framework. Our policy makers need to think this through to benefit local industry and population. Here I find a great opportunity for Pakistan businesses to work with Chinese. We need to look for opportunities within these threats.

Okay, I have a question. I'll just add to what's said. What is the biggest resource that we have? It's our human resource. This human resource with brilliant ideas can actually take over the world in terms of economics.

All right, so quickly on Gwadar and Bilal's point about the model implemented by the company. I said at my presentation also that I am a firm believer that there has to be social and economic inclusion. I love the model that they have there, and I said that this is what we need to do: look after the local people throughout the economic corridor in Pakistan, provide these people opportunity. We need to create that environment, work together. The private sector needs to work with policy makers. Policy makers need to hear from us how this is all going to benefit. So I would completely echo the same understanding. Gwadar is essentially important, and we need to empower the local people and provide them opportunity, not make them sufferers like in Sui, but make them beneficiaries like in Thar. Now coming back to the toll roads: toll roads have different models. Who is the user? The ultimate user is actually paying. Whether it is developed by finance from the US, Germany, Pakistan, or China, it has to be paid back. But look at the economic benefit. Do not look only in isolation at fund flow. Capital doesn't have borders. We need to look at the fund flow and the ultimate economic benefit. Pakistan is a country stressed in terms of finance, and public-private partnership is the answer. If private finance can come from Pakistan, excellent. If it comes from any other part of the world, it's completely fine.