IMF to launch Pakistan economic outlook on May 2, 2018 in Dubai, UAE

Jihad Azour, Director, Middle East and Central Asia Department, IMF in a press briefing held last week announced that International Monetary Fund is expected to launch the update for the outlook for the Middle East, North Africa, Afghanistan, and Pakistan on May 2nd in Dubai. He announced that later in the month of May, IMF will launch the outlook for the Caucasus and Central Asia (CCA).

He also made a few remarks about the forecast for the regions focusing on the Middle East, North Africa, Afghanistan and Pakistan regions. The good news is growth is improving in 2018 in both oil importing as well as also oil exporting countries. In the region’s oil exporters, economic growth bottomed out in 2017 at 1.7 percent but is projected to stage somewhat of a recovery this year and beyond, growing at 2.8 percent in 2018 and 3.3 percent in 2019. This is due in part to strengthening activity in the non-oil sector, which has helped mitigate the effects of lower oil production under the terms of the extended OPEC+ agreement.

Answering a question by a journalist on Afghanistan and Pakistan, Mr. Azour mentioned that the political agenda in Afghanistan is heading to election in almost year-and-a-half, and the priority is now to keep the momentum on the reform agenda even during this transition period. IMF is helping Afghanistan with a program, and the objectives of the program are to provide them with a macroeconomic framework that will allow Afghanistan to stabilize the situation, as well as also allow the international community to provide them with assistance.

Any improvement in security conditions will immediately have a positive impact on the economy in Afghanistan. Any smooth and peaceful transition in power will also strengthen institutions, and this is, in fact, the purpose of our assistance to Afghanistan.

Pakistan had a relatively high level of growth over the last few years, but it came at high cost in terms of fiscal and external vulnerabilities, and those vulnerabilities need to be addressed in order for growth to be sustainable for the medium term. We hope after the election, that will take place soon, the government will reconfirm their resolve to the reform agenda that will allow gradually to reduce the level of deficit that grew in the past, as well as also to address the current account deficit that is currently impeding their economy from having sustainable level of growth.

Regarding the other emerging economies in the region he said that Egypt has significantly improved. And in the last assessment by the rating agencies IMF has seen some improvement. The lower credit rating is an incentive for the government to be serious in achieving and maintaining stability especially for people with high debts.

About interest rates in Egypt, interest rates dropped really tremendously. And also managing the monetary policy is something that should be very accurate and precise. And that's why Egypt needs to be balanced, and to give confidence in the mechanisms used.

The general objective is to redirect resources to highly productive areas, and studies proved that spending on subsidies is not effective. So the implementation mechanisms and the timing, this is up to the government of Egypt.

Posted on: 2018-04-26T11:15:00+05:00