| Pakistan state of emergency: assessing the business impact
On 03 November Pakistan entered into a state of emergency citing a crisis brought about by militant violence, threats to Pakistan's sovereignty and a judiciary which had paralyzed the government. This short article analyses the potential reputation impact on the growing IT/IT Enabled services (ITES) sector in the country. Wikipedia defines ‘country risk’ as “the likelihood that changes in the business environment adversely affects operating profits or the value of assets in a specific country. For example, financial factors such as currency control devaluation or regulatory changes or stability factors such as mass riots, civil war and other potential events contributing to companies' operational risks.” In the current scenario, one of the major areas of concern is the perceived political instability and security and country risk among the businesses/investments flowing into the country. The government and industry associations like PSEB (Pakistan Software Export Board), Pakistan Software Houses Association (PASHA), The Computer Society of Pakistan (CSP), Association of Call Centers and Outsourcers (ACCO), Pakistan Computer Association (PCA) and TiE have engaged in several initiatives to increase awareness of Pakistan in the international markets and highlight the capabilities and opportunities in the country. The current state of emergency is likely to have a detrimental impact on these activities, seriously affecting the view that Pakistan is a safe and stable country to offshore to and to host services in. Direct investment in the country and its businesses by overseas companies is also likely to be affected. Overall these factors could seriously damage the fledgling IT/ITES industry, with investments and contracts being diverted to other regional offshoring destinations, including India, the Philippines, Malaysia and Singapore.
•Date: 8th Nov 2007• Region:Asia •Type: Article •Topic: BC general
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