Current status of ROZs: Commerce to make presentation before ECC today

[Naveed Yaseen]

MUSHTAQ GHUMMAN
ISLAMABAD (September 15 2009): The Commerce Ministry will give a presentation to the Economic Coordination Committee (ECC) of the Cabinet on Tuesday on current status of the much-talked about Reconstruction Opportunity Zones (ROZs) in the bordering areas of FATA, AJK and Balochistan. Official sources told Business Recorder that the US House of Representatives had approved ROZs legislation on June 12, 2009.

They said that GoP has stressed the need for changes in product coverage (mostly garments) and area coverage to include the whole of Balochistan which, it is expected, would be given due consideration by the US administration. Pakistan is lobbying through US industry, Pakistan Embassy and Commerce Ministry. The bill is expected to be finalised by US Senate during this year.

Sources said that dialogue has been initiated with the governments of NWFP, Balochistan and AJ&K to finalise the sites for ROZs and institutional arrangements and to develop an incentives package. According to sources, campaign to inform potential investors has been launched in addition to allocation of Rs 3 billion in the Public Sector Development Program (PSDP). A study has also been initiated for in-depth analysis to identify possible changes required in the regulatory framework.

Initially, a Joint Study Group (JSG) was established with the US to discuss and finalise details regarding the setting up of ROZs, developing a roadmap for Free Trade Agreement (FTA) and discussing the possibility of easier market access. Sources said that an apex organisation will be established at the federal level under the administrative control of Commerce Ministry, under the name of program management unit.

This is expected to be finalised by October 2009. Provinces will be empowered to establish similar organisations and operate ROZs. Sources said ROZs will be established as corporate entities under contractual arrangements with provincial set-up. FBR units will be established in the provincial set up and ROZs.

They said legislation on ROZs is expected to be finalised this year as sites have already been identified. "We hope that in-depth legal study on ROZs and submission of its recommendations will be completed by next month and finalisation of institutional set-up is expected to be finished by December 2009," sources said, adding that work on at least one ROZ in every province/area would start by March 2010.

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