In Pakistan, the government arrested further deterioration of trade and fiscal balances, but chronic structural weaknesses remained unresolved. Economic uncertainties heightened during the second quarter of 1998. First, high population growth will continue to strain the region s limited water and arable land and will exacerbate the already severe problem of unemployment. Third, lack of financial infrastructure constrains the mobilization of financing and resources for the private sector. Financial services accounted for more than half of IFC projects approved in the region in FY98.
Examples are tourism, agribusiness, and natural resources extraction.
A major challenge for Camena economies is establishing transparent legal and regulatory frameworks that lay the groundwork for private sector development and attract private capital inflows and investment. IFC s investment operations were complemented by substantial technical advice and training in privatization, risk management, policy advice, and legislation affecting leasing, securities, housing, and insurance. The year s IFC investments emphasized developing capital markets and foreign exchange generating activity, such as agribusiness and tourism. IFC spent significant time and resources on technical assistance to prepare for private sector development and attracting private capital inflows and investment. FIAS advised the Jordanian government on improving the environment for foreign direct investment and provided additional assistance in procedural reform following its diagnostic look at the investment climate last year.