Technological advances have opened up many possibilities for trade in services across borders: Razak

ISLAMABAD: Advisor to the Prime Minister on Commerce and Investment, Abdul Razak Dawood on Tuesday said technological advances have opened up many possibilities for trade in services across borders in many sectors.

He said this while addressing a consultative meeting on service exports and examined the state of service trade of Pakistan and steps taken to expand this trade, here in the Ministry of Commerce, said a press release.

He said now after decades, the British American Tobacco (BAT) has decided to move its business shared services (BSS) operations from Malaysia to Pakistan.

Razak Dawood said this is an indication that Pakistan is now being considered as a cost effective location for activities like back office services, business process outsourcing (BPO), call centres, etcetera.

This is a major development and it is hoped that other multinationals will follow suit, he added.

He said after Deutsche Bank withdrew its BPO operations from Pakistan, no major multinational company considered moving its BPO operations to Pakistan.

He informed that this was especially true for back office services which are now called BPO of which the BSS are a specialised form. These include customer support, sales and marketing support, bookkeeping, payroll management, fee collection, transcription, he said.

The advisor reiterated the importance of these services and informed the participants that Pakistan Tobacco Company (PTC), a subsidiary of BAT, had been competing for BAT’s global business services (GBS) to be setup in Pakistan.

He informed that earlier this year, he had held a meeting with the management of BAT, over video link, in order to market Pakistan as a favourable destination for the shared services.

He informed the participants that the PTC has succeeded in accomplishing this monumental task and has announced BAT's plan to set up its BSS organization hub—the BAT GBS for Asia Pacific and Middle East Region—in Pakistan.

He further informed the meeting that this had been a rigorous process, which spanned over several months, during which Pakistan was evaluated by BAT, along with countries like India and Bangladesh, for deciding to set up its organization.

This decision was taken after evaluating countries on key factors like existing commercial presence of BAT, country sustainability, availability of workforce and talent, amongst many other factors, he said.

Razak Dawood informed that the decision for setting up BAT’s shared services hub in the country is a matter of great pride for Pakistan and the PTC.

He praised the management of PTC for having accomplished this task because it was the first time after many years that a multinational has shifted its shared services hub to Pakistan.

He added that this would add Pakistan to the list of countries like Malaysia, Romania, Costa Rica, etcetera where BAT operates its service hubs for servicing 180 entities across the globe for finance, human resources, information technology and other functions.

He informed that this is likely to create thousands of jobs over the next 5 years and it would also serve as a talent incubator and will create global careers prospects for Pakistani youth.

He informed the meeting that the shared services organization is covered under Mode-II of the service exports and it will earn USD$ 100 million annually in service exports initially, with potential to increase further in future.

Razak Dawood announced that the government of Pakistan will facilitate the company in fulfilling the legal and regulatory requirements for establishing the Organization.

He hoped that this would encourage other multinational subsidiaries in Pakistan to make efforts with their Principals for moving such shared services organizations to Pakistan.