MANILA, March 24 (UPI) -- Pakistan needs to attract financial capital to its power sector in order to take full advantage of lower crude oil prices, the Asian Development Bank said.
ADB Director for Pakistan Werner Liepach said the nation's economy should experience modest growth, but more attractive investment policies are needed.
"Ongoing efforts to make the power sector financially viable and reforms of public sector enterprises through restructuring and/or privatization are vital for macroeconomic gains," he said in a statement Tuesday.
ADB said in a development report for 2015 it expects Pakistan's economy to expand from 4.2 percent this year to 4.5 percent in 2016. Much of the regional economic growth is in part a reaction to lower oil prices, which benefits importing nations like Pakistan.
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The report said low oil prices are a boon for the global economy and growth in Asia in particular. Cheap oil slows inflation and regional policymakers should seize the opportunity to enact structural reforms across Asia, the ADB said.
For Pakistan, the bank said the economic growth rate was still below the level needed to attract labor and capital.
The bank, which has headquarters in Manila, in February announced plans to help Pakistan build its first liquefied natural gas terminal with a $30 million loan. The plant will be able to convert as much as 3 million tons of LNG per year to gas for use in state power plants.
Pakistan's aging infrastructure means the country lacks a reliable power sector. With the LNG facility, the bank said the Pakistan government would save about $1 billion per year on its fuel import bills.
