Pakistan aims for B- rating to reenter global markets

July 30, 2024 (MLN): The government is aiming for Pakistan to re-enter international capital markets and achieve a minimum credit rating of 'B-', Federal Minister for Finance and Revenue Muhammad Aurangzeb said on Tuesday.

A 'B-' rating is the minimum ranking for any finance sector to enter international markets.

Addressing the executive committee of the Pakistan Banks Association (PBA) at the Islamic Chamber of Commerce building on Tuesday, the finance minister said, "We are aware of the current challenges, but with the IMF's core approval, we believe the situation is manageable."

It is essential to continue focusing on agriculture and support initiatives like SIFC, the minister stated.

"The agriculture sector and IT industry, especially freelancers, need proper fund allocation. It is time for private banks to step up in terms of finance and fund allocation," he added.

He further noted, "We are urging the private sector to take ownership and lead these transformations." He said there was a need to create capacity to get the cash flow lending moving and move forward".

Muhammad Aurangzeb has stressed on the corporate farming in collaboration with the Special Investment Facilitation Council (SIFC) so that economic growth could be accelerated. 

He also highlighted key initiatives and discussed the macroeconomic situation in the country, as APP reported.

Muhammad Aurangzeb said it was encouraging to see the private sector taking proactive steps in advancing financial and technological infrastructure.

The minister stated that extensive talk has been conducted on the macro aspect, but moving on the external financing front, the government is comfortable with the current situation." We are moving forward with the IMF draft resolution", he added.

The minister also emphasized the importance of public-private partnerships, particularly with HBL and NBP, stating, "We need to create capacity and move forward".

Addressing the energy sector, Muhammad Aurangzeb noted that the development sector was facing issues with additional taxation, high energy costs and high interest rates.

While competitive energy tariffs are not currently available, progress can still be made.

He said the large-scale manufacturing sector is also facing challenges, but they are working on providing support where possible.

The minister concluded by urging banks to focus on agriculture, finance, and data collection.

The meeting concluded with an announcement that next week, the International Finance Corporation (IFC) will be expecting banks to share their updates and initiatives.

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