Business

From Yamaha to Careem and now P&G: Why are Multinational Companies leaving Pakistan?

By Web Desk lahore

Copyright pakobserver

From Yamaha to Careem and now P&G: Why are Multinational Companies leaving Pakistan?

ISLAMABAD – Pakistani government has long promised to create a favorable environment for businesses, but recent corporate moves show another trend as multinational giants are winding up their operations in the country. The latest example is Procter & Gamble P&G group, the maker of Gillette razors and household products, which is exiting Pakistan.

P&G is the latest company to wind down operations as part of a broader global restructuring plan, but it is not the only company. The recent move follows trend of multinational corporations cutting their footprint in Pakistan over past three years.

Whats behind these exits

As masses are raising questions government’s policty, these companies generally have their own reasons for making such decisions. In case of Shell, the oil ginat exited retail fuel businesses in Mexico and Indonesia as well as Pakistan to tap LNG business.

The reasons behind such exits actually vary by sector. Pharma giants leave due to delays in price change approvals and unethical practices among some local competitors. P&G is also leaving amid global strategic shifts. Other factors contributing to exits include weak enforcement of intellectual property rights, competition from local firms, the large informal sector, shrinking profit margins, high taxes, and a depreciating Rupee.

It is to be noted that leaving Pakistan does not always mean the company’s products will end from the market as several companies make their via third-party agencies.