June 11, 2024 (MLN): Federal Minister for Finance and Revenue, Senator Muhammad Aurangzeb on Tuesday said that despite challenges, the country had made significant progress in achieving macroeconomic stability, with a remarkable 30% growth in revenue collection, a reduced current account deficit, reduction in inflation and a stable currency, as APP reported.
Addressing a press conference at the launching ceremony of Economic Survey of Pakistan 2023-24, the minister said, this situation indicated a remarkable turnaround from a precarious economic situation, characterized by a 0.2% GDP contraction, 29% rupee depreciation, and a shrinking foreign exchange reserves, which had declined to just two weeks’ worth of import cover.
He said, despite challenges in the large-scale manufacturing (LSM) sector due to interest rates and energy issues, the country’s GDP growth had found a silver-lining in the agriculture sector, which had been boosted by bumper crops.
He said, the agriculture and the dairy and livestock sector were expected to remain a key driver of growth in the years to come.
Finance Minister Muhammad Aurangzeb said the economic journey of Pakistan in the current fiscal year commenced under the leadership of Prime Minister Shehbaz Sharif before caretaker administration, who took the bold step of approaching the International Monetary Fund (IMF) and singing of 9-month Standby Agreement, which was very important part of the progress the country had been witnessing today.
He said had it not been signed, the situation would have been very different and there would have been discussions on economic figures in a very different context.
He said the decision of going to IMF had proven fruitful for the country’s economy.
He was of the view that successful conclusion of the IMF’s Stand-By Arrangement (SBA) had also restored the confidence in Pakistan’s economy.
Talking about future program with the Fund, the minister said Pakistan and IMF have had a productive and constructive dialogue during the fund’s recent visit. He said, the successful conclusion of the SBA has demonstrated Pakistan’s commitment to discipline, which had been acknowledged by the IMF.
He said, the dialogue focused on the constructive nature of Pakistan’s reform agenda, which the government had pledged to continue.
He said the program with IMF, was for the benefit of Pakistan to improve its economy. “This is Pakistan’s program, which was being aided, supported, and funded by the IMF.” The key areas of focus include enhancing tax revenues, improving the complex energy equation, and implementing power sector reforms besides privatization of state-owned enterprises (SOEs).
He said, the discussion with IMF were progressing positively, with both parties committed to working together to achieve Pakistan’s economic goals.
The minister said the country’s Current Account Deficit (CAD) had also seen a significant reduction, from an estimated $6 billion to just $200 million. “The country has even experienced a current account surplus for three months adding the surplus is expected during the month of May as remittances stood at $3.2 billion during the month.”
He said the currency had stabilized and inflation had come down, leading to a reduction in policy rates by State Bank of Pakistan adding market rates had responded positively, with foreign buying returning to the market.
The currency had stabilized due to a series of administrative measures taken by the caretaker government, including the crackdown on Hundi-Hawala, smuggling, and the regulation of transit trade to Afghanistan.
Additionally, he added, the State Bank of Pakistan’s structural interventions had successfully eradicated speculation in the market, contributing to the currency’s stability.
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Posted on: 2024-06-11T21:30:05+05:00
