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CPI Preview: Inflation to fall below 14% YoY in May

Pakistan seeks extended IMF program after achieving economic stability: FM

Pakistan seeks extended IMF program after achieving economic stability: FM
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April 18, 2024 (MLN): Pakistan has achieved a semblance of economic stability after the 9-month SBA with IMF and is fully committed to entering into an extended program with the Fund to continue on the path of economic growth and development, Finance & Revenue, Muhammad Aurangzeb highlighted during the JP Morgan seminar on "Pakistan: Economic Policy Outlook".

During the Seminar, he presented an overview of Pakistan’s economic landscape, highlighting strong performance of the agriculture sector, diminishing inflationary pressures, stable exchange rates, declining trade deficit and strong remittances.

He said that the government was cognizant of the challenges/risks ahead and was taking short and long-term measures to address them.

Outlining the government’s reform agenda, he identified taxation, energy and privatization as key areas of reforms for the government.

Finance Minister attended the Middle East, North Africa, Afghanistan and Pakistan (MENAP) Ministers and Governors meeting with the Managing Director of the International Monetary Fund (IMF), Ms. Kristalina Georgieva.

The meeting provided an opportunity for the Finance Minister to engage with IMF leadership and counterparts from MENAP region on key economic issues and policy priorities.

In his intervention, the Minister highlighted the impact of geo-economic fragmentation on Pakistan's economy.

He expressed gratitude to the IMF, multilateral development banks, and bilateral partners for their support in helping the country respond to unprecedented challenges.

He underscored the government's aggressive reform agenda, including broadening the tax net, privatizing loss-making state-owned enterprises (SOEs), expanding the social safety net, and facilitating the private sector.

The Finance Minister underlined the importance of rechanneling Special Drawing Rights (SDRs), reviewing the surcharges policy, and prioritizing the Resilience and Sustainability Trust (RST) in view of Pakistan's climate vulnerabilities.

He called for a more proactive and responsive Global Financial Safety Net to tackle elevated risks. The Finance Minister also welcomed the IMF's renewed emphasis on capacity building through Regional Capacity Development Centers (RCDCs).

Donald Lu, Assistant Secretary and Elizabeth Horst, Principal Deputy Assistant Secretary of US State Department met Finance Minister Mohammad Aurangzeb at World Bank headquarters to underline the political will in Washington to strengthen Pak-US ties.

The emphasis during the meeting was on upgrading economic partnerships, with special emphasis on alternate energy, agriculture, climate resilience, and tech industry.

The Minister briefed them on Pakistan’s reform agenda encompassing broadening the tax base, streamlining the energy sector and fast-tracking the privatization process of state-owned enterprises.

He identified emerging opportunities for American investments in IT, renewables, agriculture and minerals extraction. The Minister said that Pakistan will work closely with US International Development Finance Corporation and Exim Bank.

Finance Minister met with UAE’s Minister of State for Financial Affairs Mohamed bin Hadi Al Hussaini to discuss bilateral economic cooperation and explore avenues for strengthening ties between the two brotherly nations.

The Finance Minister acknowledged the long-standing ties between Pakistan and the UAE, anchored in shared history, culture and faith. He expressed gratitude for UAE’s financial support to Pakistan in times of need.

He said that the government intended to continue with reforms initiated under the current IMF program in the priority areas of taxation, energy and privatization of SOEs.

He highlighted Pakistan's firm resolve to address economic challenges and create a conducive environment for sustainable growth and investment.

He also expressed Pakistan’s keen interest to re-engage with Middle Eastern Banks to revive their interest in potential investment opportunities in the country.

The Finance Minister held a meeting with Hiroshi Matano, Executive Vice President of the Multilateral Investment Guarantee Agency (MIGA), a member of the World Bank Group, to discuss Pakistan's investment landscape and measures to enhance investor confidence.

During the meeting, the Finance Minister appreciated MIGA's continued support in attracting foreign direct investment (FDI) into Pakistan.

He highlighted government's ongoing economic reforms aimed at improving the investment climate and creating a business-friendly environment for both domestic and international investors.

He briefed Matano on the efforts being made to resolve the issues faced by a Korean investment company operating in Pakistan, underscoring the government's commitment to addressing investor concerns and facilitating the ease of doing business.

The Finance Minister reiterated Pakistan's focus on promoting sustainable and inclusive economic growth, emphasizing the crucial role of FDI in achieving this objective.

Matano commended the government's efforts to enhance investor confidence and expressed MIGA's readiness to continue supporting Pakistan in attracting quality foreign investments across various sectors of the economy.

The Finance Minister held a productive meeting with representatives from Deutsche Bank. During the interaction, he appreciated the long-standing support extended by Deutsche Bank to the Government of Pakistan in various financial endeavors.

The representatives from Deutsche Bank briefed the Minister on different transaction structures that could assist the government in accessing international capital markets effectively.

A key area of discussion was the establishment of a Sustainable Finance Framework for the issuance of green or sustainability bonds.

Other engagements of the Finance Minister included meetings with Fund-Bank Staff Association, Daniel M. Zelikow, Vice Chairman, Public Sector, JP Morgan, print and electronic media interviews at the Bloomberg Headquarter and get-together with representatives of think tanks and media hosted by the Ambassador of Pakistan.

Finance Minister is leading Pakistan’s delegation in the IMF / World Bank’s 2024 Spring Meetings being held in Washington DC.

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Posted on: 2024-04-18T11:14:17+05:00