Leading economist and former Privatisation Minister of Pakistan Dr Hafeez Shaikh has accepted the government’s offer to become the country’s Finance Advisor. Dr Shaikh confirmed that he had agreed to succeed former Finance Minister Shaukat Tarin as an advisor — not a minister.
Dr. Shaikh has a Ph. D in economics from Boston University. With the World Bank, Dr Shaikh’s international experience included assignments in the Middle East, South Asia, East Asia, Europe and Africa.
As Minister for Finance, Planning & Development in Sindh from 2000-2002 he successfully designed and implemented a strategy for the financial recovery of Sindh. Within three years, Sindh’s economy and fiscal system was stabilized, expenditure and taxes were considerably reduced, revenues increased as well as allocations for development and social sector spending. The province’s State Bank overdraft was reduced by Rs. 11billion and old debts amounting to Rs 20 billion were cleared thus giving Sindh some fiscal space.
Dr. Shaikh was widely recognized as the architect of Sindh’s financial revival. During his tenure, the duty on the transfer of property was reduced from 9% to 3% and after simplifying the property tax system, 100,000 new properties were brought into the tax net. Despite a reduction in both the rate and number of taxes, Sindh’s revenues increased to such an extent that in his very first budget, it was announced that education would be made free up to Matriculation, textbooks would be provided free to elementary school students and a cash stipend introduced for girls in middle schools. Scholarships for university education were also introduced. It is to Dr. Shaikh’s credit that immediately after the province had some financial breathing space, his first priority was social services.
His tenure as Minster for Investment & Privatisation was undoubtedly a golden period in Pakistan’s economic history and he left behind a formidable legacy and a track record difficult to compete with. 34 transactions worth over US $5 billion were completed in line with international standards. Through the innovative “Privatization for the People” programme, shares in several companies were given to 0.8 million people, creating broad public ownership. His departure in 2006 caused widespread dismay.
Dr. Shaikh took on giants like the Karachi Electric Supply Company and Pakistan Telecommunications Company Ltd which were hemorrhaging the exchequer and were being virtually controlled by local political mafiosi.
During his tenure, investment in all sectors increased including foreign direct investment rose from US$ 800 million in 2003 to US$ 3 billion in 2006 – a 500% increase. Dr Shaikh was awarded Pakistan’s “Man of the Year” in 2004 by the business community in recognition of his contribution to the country. He left the government in early 2006.