Vulnerable Pakistan aims for climate-resilient economy

May 10, 2024 (MLN): Pakistan is committed to addressing climate change and promoting green investment opportunities, Federal Minister for Finance Muhammad Aurangzeb stated during his keynote speech at the UK-Pakistan Green Investment Forum, organized by the British High Commission in Pakistan.

In his address, he highlighted Pakistan's vulnerability to the adverse effects of climate change, despite its low contribution to global greenhouse gas emissions, said a press release issued today.

He cited a recent World Bank study, estimating potential annual GDP losses of up to 1% due to climate-related risks.

Acknowledging the significant funding gap in adaptation, resilience, and mitigation projects, the Federal Minister stressed the importance of bridging this divide.

He noted that the changing weather patterns in Pakistan are impacting agricultural yields and posing threats such as flooding, storms, and heatwaves.

Expressing gratitude to the British High Commission for organizing the forum, the Minister Muhammad Aurangzeb acknowledged the need for a better portfolio of green investment projects.

He emphasized Pakistan's reliance on the private sector for support and highlighted the government's efforts to enhance investor confidence in bankable green opportunities.

The Minister also outlined Pakistan's plans to utilizing innovative financing instruments to raise international climate finance.

He said that the government is working on issuing domestic green sukuk bonds by December 2024 to finance sustainable development projects.

The Finance Minister Muhammad Aurangzeb elaborated on the significant improvements in various macroeconomic indicators over the past 10 months.

He provided an overview of the country's macroeconomic stability, including improvements in inflation, GDP growth in the agricultural sector, increased forex reserves, upward trend in stock market, and the projected reduction of the Current Account Deficit.

The minister also communicated about the successful completion of the 9-month-long Standby Arrangement (SBA) of IMF, and expressed the intent to engage with the IMF for a medium-term fund-supported program which demonstrates Pakistan's resolve to pursue sustained economic growth and stabilization.

The Minister for Finance & Revenue concluded the speech with an invitation to investors, expressing eagerness to hear about the challenges they encounter when investing in Pakistan.

He reiterated the Government's determination to make the business environment more conducive for international investors.

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