Pakistan has Asia's top-performing stock market this year. But, as Eve Johnson reports, there's a big challenge ahead for the country's economy.
After ten years of conflict, things are looking up for Pakistan It's Asia's top performing stock market this year and it's economy is growing.... But when it comes to bringing in foreign investment....there's a fly in the ointment. (SOUNDBITE) (English): REUTERS REPORTER IN ISLAMABAD, DRAZEN JORGIC, SAYING: "Many foreign investors and foreigners in general associate Pakistan with some of the problems it's had over the last ten years, mainly attacks by Islamists, the Pakistani Taliban, the death of Osama Bin Laden in Pakistan and a difficult relationship with the United States and other western countries. And this image problem is basically hampering Pakistan as it tries to rebuild its economy." A drop in violent attacks and a growing middle class have given growth a big boost. And some foreign companies are looking interested.... Like carmakers Renault-Nissan and Suzuki But when it comes to the stock market, investors have long memories. (SOUNDBITE) (English): REUTERS REPORTER IN ISLAMABAD, DRAZEN JORGIC, SAYING: "In 2008 Pakistan's stock market begun to collapse, the share index was in free fall. And Pakistani officials imposed a floor on the stock exchange, which basically means that they limited withdrawls and trapped investors in the falling stock market for about three months time. And that unnerved investors and led to huge outflows from Pakistan in terms of foreign uh investment." The government has pushed through new reforms - saying the same mistakes will not be made again But foreign investors haven't returned in droves... even though the stock market has delivered a 500 percent increase since 2009... But there may be help ahead The MSCI index is getting ready to upgrade the country from frontier economy.... to emerging market status.