Federal Planning and Development Minister Ahsan Iqbal on Monday convened a meeting in Islamabad with relevant authorities to assess the situation triggered by a Chinese company’s sudden announcement to shut down its operations in Pakistan and China, including a factory in Gwadar.
The company, Han Geng Group, had issued a statement on Friday citing administrative, policy and operational challenges that hindered its business activities.
Prime Minister Shehbaz Sharif and the planning minister took immediate notice of the development and directed officials to examine the company’s concerns and ensure swift resolution.
Mr Iqbal conveyed a firm message that all operational and bureaucratic obstacles faced by investors under the China-Pakistan Economic Corridor (CPEC) would be addressed on a priority basis to sustain investor confidence.
Following the government’s prompt response and assurances, the Chinese firm withdrew its decision and opted to continue its operations in both Pakistan and China.
In its earlier statement announcing the closure, the company said the decision stemmed from “persistent non-market factors and administrative obstacles” that made continuing operations unfeasible.
The company maintained that its facilities fully complied with China Customs inspections and international food safety standards. Despite meeting these requirements, it said it had repeatedly failed to secure the approvals needed for exports.
Over the past three months, the statement added, the company had remained cooperative and patient, but had incurred significant financial losses due to employee salaries, electricity costs, contractual penalties and container demurrage charges.
It also expressed concern that despite being involved in major initiatives such as Gwadar Port and CPEC, it continued to face “challenges beyond the capacity of any private enterprise”. The company pointed to administrative uncertainty and difficulties in policy implementation as the main factors behind its decision to shut down operations.
