tag:blogger.com,1999:blog-84911919347524792382024-03-08T06:39:52.127-08:00MNCs in Pakistan (Multinational Corporations in Pakistan)MNCs in Pakistan, MNCs of Pakistan, Multinational Corporations in Pakistan, Multinational Companies in Pakistan, Multinational Corporations Pakistan, Multinational Companies Pakistan,Anonymoushttp://www.blogger.com/profile/06381985816828173099noreply@blogger.comBlogger4125tag:blogger.com,1999:blog-8491191934752479238.post-65276350943706945112012-04-05T06:51:00.000-07:002012-06-30T06:52:10.438-07:00EMERGENCE OF GSK (GlaxoSmithKline) as an MNC in Pakistan: case study<br />
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<span style="font-family: "Arial","sans-serif"; font-size: 12pt;">GlaxoSmithKline
(GSK) is one of the biggest names in the Pharmaceutical Market of Pakistan. It
would not be wrong to say that GSK is the Market Leader among the top
Multinational Corporations in Pakistan, as well all other national
pharmaceutical companies.</span></div>
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<span style="font-family: "Arial","sans-serif"; font-size: 12pt;">GSK
began operating from UK in 1880, by the name of Wellcome and Company. Glaxo was later formed in 1904. Originally,
Glaxo was a baby food manufacturer, processing the baby milk and marketing it
by the same name.</span></div>
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<span style="font-family: "Arial","sans-serif"; font-size: 12pt;">In
2001, Glaxo Welcome and Smithkline and French, Beecham Pakistan, merged to form
GlaxoSmithKline (GSK) becoming the largest Pharmaceutical Company in
Pakistan. There it launched a Central
Nervous System (CNS) Franchise, to combat depression, which affected 33% of
Pakistani population.</span></div>
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<span style="font-family: "Arial","sans-serif"; font-size: 12pt;">In
2002, GSK launched ‘Seretide’ a block buster drug to fight asthma, a disease
that effects 300 million people worldwide. ‘Augmentin’ became the first ever
drug in Pakistan, to cross the Rs. 1 Billion mark.</span></div>
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<span style="font-family: "Arial","sans-serif"; font-size: 12pt;">Providing
protection to sensitive teeth, GSK Pakistan begins to locally manufacture
‘Sensodyne’ in 2004, the number 1 tooth paste in the sensitivity worldwide.</span></div>
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<span style="font-family: "Arial","sans-serif"; font-size: 12pt;">In
2005, Pakistan was struck with a massive Earth quake. GSK immediately responded
to the earth quake relief efforts by contributing Rs. 400 million and life
saving medicines worth Rs. 20 million within 48 hours of the earth quake. Same
year, GSK received; Excellence Award in Best Practices’ by the Occupational,
Health and Safety by Employers Federation of Pakistan. </span></div>
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<span style="font-family: "Arial","sans-serif"; font-size: 12pt;">In
2006, GSK achieved a big miles stone, of launching ‘Rotarix’. This vaccine was
designed to combat Rotavirus, the leading cause of severe diarrhea in children.
This was the only and first of its kid of vaccine available in Pakistan. In the same year GSK received 50star rating
from the Global Internal Audit, the highest rating in the industry. Same year,
GSKs site in West Wharf completed its 1 million hours without any
injury/illness. As one of the multinational companies in Pakistan, it really
gained a lot recognition.</span></div>
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<span style="font-family: "Arial","sans-serif"; font-size: 12pt;">In
2007, reaffirming its commitment towards the Pakistani market, GSK added a
77,000 sq/ft state of the art Penicillin manufacturing site. Since the minimum requirement for
infrastructure by multinational companies in Pakistan is about 60,000 sq ft of
area. GSK received ‘The Most Preferred Pharmaceutical Company’ award by the
Pakistan Society for Human Resource Management. </span></div>
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<span style="font-family: "Arial","sans-serif"; font-size: 12pt;">GSK
Pakistan supplies 71 million of doses of vaccines, the largest shipment in the
history of GSK Biological, to the Pakistan Government for Expanded Program on
Immunization (EPI). Gsk received the Excellence award for best management
practices by the Management Association of Pakistan. </span></div>
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<span style="font-family: "Arial","sans-serif"; font-size: 12pt;">Another
merger of Stiefel Laboratories and Bristol Mayers Squib business in Pakistan
took places in 2009. GSK won the Annual
Environment Excellence Award in recognition of it polices on safeguarding
health.</span></div>
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<span style="font-family: "Arial","sans-serif"; font-size: 12pt;">In
2010, ‘Augmentin’ crosses the Rs 3 Billion mark, in the history of
pharmaceutical market. Cervex a cancer vaccine was launched, as a sign of GSKs
commitment towards eradicating cancer in women.</span></div>
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<span style="font-family: "Arial","sans-serif"; font-size: 12pt;">In
2011, Panadol entered the club of billionaire, by crossing the Rs. 1 billon
mark. It became the fourth GSK brand to in the Pakistani market. </span></div>
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<span style="font-family: "Arial","sans-serif"; font-size: 12pt;">At present
GSK has a Market share of around 15%. After about 12 years of enabling people
to do more, feel better and live longer, GSK Pakistan stands as the largest
Pharmaceutical Company in Pakistan and leading the industry operation and
competition among the MNCs in Pakistan by volume, value and prescription.</span></div>Anonymoushttp://www.blogger.com/profile/06381985816828173099noreply@blogger.com1tag:blogger.com,1999:blog-8491191934752479238.post-36181884694456912722012-02-27T07:54:00.000-08:002012-06-30T06:45:48.026-07:00Contemporary Trends of Multinational Corporations or Companies; MNCs in Pakistan<div class="MsoNormal" style="line-height: normal; margin-bottom: 0in; text-align: justify;">
<span style="font-family: "Arial","sans-serif"; font-size: 12pt;">The
future is bleak or is it? Recently I read a report in a local paper about how
multinational corporations or companies view Pakistan. As per the article
‘despite several economic challenges Pakistan is currently facing,
multinational companies (MNCs) are considering expanding their business in the
country by bringing handsome investment, transfer of technology and advanced
business practices’. Yes it’s true and many of you reading this might be
pinching yourselves to make sure it is real.</span></div>
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<span style="font-family: "Arial","sans-serif"; font-size: 12pt;">However
here’s the catch (isn’t there always one?) they want the government to come up
with consistent policies and concrete plans before taking any step in this
direction. This was revealed by Ameena Saiyid, President Overseas Investors’
Chamber of Commerce and Industry (OICCI) to the press.</span></div>
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<span style="font-family: "Arial","sans-serif"; font-size: 12pt;">In
spite of the strife and problems, experts are confident about the importance of
Pakistan in the region as a growing economy of the world with lots of business
opportunities in various sectors.<br />
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Which areas are the multinationals really interested in? Five major sectors
have been earmarked for investment including ‘corporate farming’, agriculture,
infrastructure, skill development, minerals and alternative energy such as
coal, hydel, wind and solar energy production. It seems logical to expect
investment to be given for farming given the agricultural based nature of our
economy and infrastructure is solely lacking. There’s no question that Pakistan
is mineral rich but the field of alternative energy seems like a weak bet.
People might feel that if this field was so lucrative wouldn’t the government
be pursuing it?<br />
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Definitely Pakistan is a huge market with a significant population of middle
class, of up to 30 million people. To get an idea about how large 30 million is
in terms of figures, we need to remember how the UK has a population of around
70 million. More importantly than the middle class, youth under 25 years of age
has crossed the 100-million mark in the country. There are more than 70 million
TV viewers and 120 million mobile phone users in Pakistan. <br />
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Overseas investors and Multinational Corporations are looking forward expanding
their business in Pakistan because they have established themselves and
obtained experience to work in the local market. The majority of the MNCs in
Pakistan are also thankfully reinvesting profits to fuel their expansions.
Speaking of expansion and area: in a survey of the Multinational Companies in
Pakistan, it was found that as a habit they have offices over 60,000 sq ft in
area. To get an idea how large that is a typical bungalow is a good 1,000 sq
ft. <br />
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Here’s something really interesting I read in that paper’s piece: Foreign
Direct Investment (FDI) is likely to increase if the government improves the
perception of the country, which is far worse than it actually seems. That raises an intriguing question, we all
know how we accuse the non- Pakistani media (yes it’s come to that) of being
biased etc. Yet is the situation really not as bad as it seems? <br style="mso-special-character: line-break;" />
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</span></div>
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<span style="font-family: "Arial","sans-serif"; font-size: 12pt;">Coming
back to the article, the writer also described the way forward as outlined by
the OICCI chief. OICCI members will be presenting comprehensive recommendations
along with their business enhancement plans and put it forward to the
government for its support in future. However no mention was made of the
timeframe for these recommendations to be submitted.<br />
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“This is high time for the government to cash in on the trends of the global
economy and make Pakistan’s environment attractive for foreign investors with
curbing the weaknesses in the present system,” stated Ameena Saiyid. The OICCI
chief expressed the threat that Pakistan faces – if the foreign firms don’t get
the required environment/climate they will change their attention to our well
set neighbors (yes India, China even Bangladesh). Once again Pakistan will lose a golden chance
to reap the benefits to be had. <br />
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Fortunately the present much maligned government has started showing its
seriousness and opened the channels of communication with foreign investors. Only
time will tell whether these steps are going to have any impact or just be a
false flag. The only thing we can be sure of is we can’t afford to miss the few
opportunities we get to change the fate of our nation. </span></div>Anonymoushttp://www.blogger.com/profile/06381985816828173099noreply@blogger.com0tag:blogger.com,1999:blog-8491191934752479238.post-55149960879421129532010-04-07T07:10:00.000-07:002012-06-22T05:12:39.905-07:00Multinational Corporations and the Future of Pakistan<br />
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<span style="font-family: "Arial","sans-serif"; font-size: 12pt;">Pakistan is a third world state with
a agricultural based economy. The nation which has nearly 190 million
inhabitants is facing numerous issues and obstacles. Yet it is part of the
group of emerging nations after BRIC with a potential for growth.</span></div>
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<b style="mso-bidi-font-weight: normal;"><span style="font-family: "Arial","sans-serif"; font-size: 12pt;">Pakistan
economy outlook</span></b></div>
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<span style="font-family: "Arial","sans-serif"; font-size: 12pt;">The GDP growth rate in Pakistan is
at levels that more developed nations such as the USA and Britain would be
eager to have. The nation also enjoys a young population with over 505 of
Pakistanis under the age of 25. The economy is growing and the per capita
income has increased over the years along with the country’s foreign
reserves. The growth spurt has been
somewhat decreased in the recent past due to the worsening situation and
political uncertainty.</span></div>
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<span style="font-family: "Arial","sans-serif"; font-size: 12pt;">However an idea of the resilience
and strength of the Pakistani economy can be gauged from the fact that the
global financial crisis did not impact the nation till about a year or a year
and a half after it broke. The country’s
growth is attracting major MNCs –those already in the market are gearing up and
putting their money on Pakistan while new companies are eager to set up shop.
The companies are ready to meet government requirements such as having an
infrastructure of over 60,000 sq ft and face extra regulation especially in the
pharma sector.</span></div>
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<span style="font-family: "Arial","sans-serif"; font-size: 12pt;">Recently it was reported that big
companies such as Unilever and Nestle with a sizeable investment in Pakistan
are hoping the country will be a source of growing profits. Figures suggest
that Nestlé Pakistan boosted sales by
29% in 2011This is in line with the Swiss brand owner has a target of deriving
45% of total revenues from the emerging world by 2020. Unilever Pakistan also
enjoyed sales growth of 15% over the period of January to June 2011. Globally,
the company has set a goal of increasing sales 100% by 2020, with most of the
growth coming from outside the USA and Europe.</span></div>
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<span style="font-family: "Arial","sans-serif"; font-size: 12pt;">The fact that Pakistan has a largely
untapped rural market is a great incentive for big MNCs. Local companies are
hard pressed to compete with the incredible economies of scale that these mega
corporations (what multinational corporations are called by some detractors)
can bring to bear. </span></div>
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<span style="font-family: "Arial","sans-serif"; font-size: 12pt;">Issues of sovereignty and transfer
pricing as well as the ability of the MNCs to put pressure on the government
which sorely requires the advantages they bring will continue to cloud the
issue. However it is clear to people who are realistic that the future of
Pakistan depends on multinational corporations and the benefits they bring.</span><span style="font-family: "Arial","sans-serif";"></span></div>Anonymoushttp://www.blogger.com/profile/06381985816828173099noreply@blogger.com0tag:blogger.com,1999:blog-8491191934752479238.post-65487764775093130882008-12-04T06:55:00.000-08:002012-06-22T05:09:26.157-07:00Multinational Companies (MNCs) in the Pakistani Economy<br />
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<span style="font-family: "Arial","sans-serif"; font-size: 12pt;">Pakistan today provides an ideal
environment for investment by multinationals and other foreign companies and organizations.
The investment friendly climate in terms
of government regulations--there are no restrictions on remitting back the
profits- is drawing them in droves. Facilities for maintaining foreign currency
accounts concessions have also been allowed to foreign firms in respect of
rules for borrowing, etc. A large number of multinationals have been operating
in the country for many years.</span></div>
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<b><span style="font-family: "Arial","sans-serif"; font-size: 12pt;">USA leads the way</span></b></div>
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<span style="font-family: "Arial","sans-serif"; font-size: 12pt;">The multinationals have invested
extensively in Pakistan. USA leads with $190 mn, followed by UK $122 mn. Other
countries that have brought in investment are in order of FDI: Netherlands, UAE, Switzerland, Singapore, Hong
Kong. China surprisingly appears down the list after these states at number 8,
with Japan following. </span></div>
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<span style="font-family: "Arial","sans-serif"; font-size: 12pt;">The Germanic firm Siemens is perhaps
the oldest in the industrial field in Pakistan, having set up in 1932, while
ICI is the second. Unilever (formerly Lever Brothers, Imperial Tobacco, Shell
and Burma Oil came soon after Independence in 1947. Many European, Korean and
Arab companies such as Orascom are active in construction, communications and
other fields. Japanese like Toyota, Suzuki, Nissan, Honda are mainly in the
automotive industry.</span></div>
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<b><span style="font-family: "Arial","sans-serif"; font-size: 12pt;">Agriculture as a base</span></b></div>
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<span style="font-family: "Arial","sans-serif"; font-size: 12pt;">Pakistan's industry is mainly
agro-based. Exxon (now Engro in the country) came first in this field in 1960,
establishing the urea factory. Hercules of USA were next to arrive, soon big
names in the agriculture field Massey Ferguson, Fiat and Belarus established
joint ventures. In the infrastructure development as well, the French firm
Sogea was involved in the construction of Karachi airport terminal. </span></div>
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<span style="font-family: "Arial","sans-serif"; font-size: 12pt;">Financial institutions such as banks
always play a very key role in the development. Presently foreign banks are functioning
in the country and have taken the lead in developing the services sector as
well as mobilizing deposits and promoting credit card culture. Over 33 per cent
of the trade handled by the MNCs was through the foreign banks. The foreign
banks facilitated the flow of foreign currency. The burgeoning Islamic banking
trend was started off not by any local bank but by Standard Chartered. Islamic
options are a viable way for banks and DFIs to circumvent the concerns of
people about interest and its usage. </span></div>
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<b><span style="font-family: "Arial","sans-serif"; font-size: 12pt;">Multinationals and government</span></b></div>
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<span style="font-family: "Arial","sans-serif"; font-size: 12pt; line-height: 115%;">Many complaints
are leveled against the presence of MNCs .However multinational corporations in
the pharma and health sector are subject to the Ministry of Health. MNCs also
are watched over by the regulatory bodies such as the Securities and Exchange
Commission of Pakistan. Many MNCs that compete against local companies in key
sectors are restricted from competing in a fair way as the state favors the
local company- companies facing off against PSO are not allowed to open as big
stations. Other stipulations such as the requirement of having an
infrastructure over 60,000 sq ft to be considered as an MNC are also
criticized.</span></div>
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<b><span style="font-family: "Arial","sans-serif"; font-size: 12pt;">Multinationals and the stock market</span></b></div>
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<span style="font-family: "Arial","sans-serif"; font-size: 12pt;">These multinational companies are
operating in different sectors like pharmaceuticals, fertilizers, food
products, including milk and tea and engineering, consumer products, polyester fiber,
chemicals etc. They lead the stock market in the same way as they dominate the
economy. Out of the total companies on the list of Karachi Stock Exchange, over
50 companies are multinationals. The leading companies include Shell, Unilever
Pakistan, PnG etc.</span></div>Anonymoushttp://www.blogger.com/profile/06381985816828173099noreply@blogger.com2