ISLAMABAD: Minister for Finance Senator Muhammad Ishaq Dar said on Wednesday that Pakistan was implementing the China-Pakistan Economic
Corridor (CPEC), which would also complement the regional connectivity initiatives of the Central Asia Regional Economic Cooperation (CAREC) countries.
“The CPEC offers a massive opportunity for connectivity between Central Asia, Middle East and Africa and is bound to play a defining role in the economic development of our region,” he said in his welcome address at the 15th CAREC Ministerial Meeting on the theme of “Linking Connectivity with Economic Transformation in CAREC”, here at a local hotel.
Prime Minister Muhammad Nawaz Sharif inaugurated the meeting while President of Asian Development Bank (ADB) Takehiko Nakao, representatives of CAREC member states, members of the Diplomatic Corps, federal ministers, senior officials also attended the meeting.
The meeting was organized by the Ministry of Finance and Economic Affairs Division.
Senator Muhammad Ishaq Dar said that improving transport corridor was not an end in itself but it was an investment in establishing sound infrastructure and complementary frameworks for opportunities in shared prosperity for the present and future generations of our region.
He added that the Central Asia Regional Economic Cooperation (CAREC) and Transport & Trade Facilitation Strategy (TTFS) provided the platform to ensure effective implementation of communications, transport and trade-related projects.
This would enable more efficient and comprehensive approach to achieving the goals of establishing competitive corridors, facilitating movement of goods and people through these corridors and providing sustainable, safe, and user-friendly transport and trade networks, the Minister said.
“Once the six CAREC Corridors and major seaports start providing access to the global markets, they will deliver services that will be important for national and regional competitiveness, productivity, employment, mobility, and environmental sustainability”, he remarked.
The Finance Minister appreciated the efforts of the President Asian Development Bank, Takehiko Nakao, his team and the CAREC members for making this event possible.
“I understand that productive discussions have been held during the CAREC Senior Officials’ meeting yesterday. These discussions covered sharing updates on the progress of priority sectors of CAREC, mid-term review of CAREC 2020, and consultations on the development of a CAREC Economic Corridor”, he remarked.
He was confident that the areas of collaboration and specific initiatives under the CAREC Programme would significantly improve connectivity in the region.
“The projects being implemented in the four core areas of communications, trade facilitation, trade policy and energy coupled with the economic corridor development would enable increased trade, enhanced availability of energy and improvement in quality of lives for all people in the region”, he said.
The Finance Minister while sharing the participants about Pakistan’s economic poicies said that the government during the last three years had carried out economic reform agenda under the leadership of Prime Minister Nawaz Sharif and now Pakistan had moved to macro-economic stability road from macro-economic instability which prevailed prior to May 2013. He added that the international community was recognizing Pakistan’s efforts in pursuing economic policies which were aimed at ensuring inclusive and sustainable growth of the country.
“We have recently completed the first time in the country’s history a three-year IMF Extended Fund Facility Programme which tantamounted to completion of all the twelve steps of the reform agenda”, he remarked.
The Minister said that major factor which led to the successful completion of the programme was the election manifesto of April 2013 of Pakistan Muslim League (N) which provided a roadmap of economic reforms which after winning general elections 2013 under the leadership of Prime Minister Nawaz Sharif formed the basis of economic policies of the government.
Ishaq Dar informed the participants that by June 2013 the economy faced manifold challenges which entailed comprehensive structural reforms. “Energy shortages were significantly hampering all areas of growth. Agriculture, large scale manufacturing and services sectors were all underperforming. The foreign exchange reserve position had reached precarious levels, the interest rates and inflation were high”, he remarked.
He added that the external sector was heavily out of balance, and the performance of state owned enterprises had severely deteriorated.
The adverse impact of these economic difficulties, he said had been further compounded by the adverse security situation which prevailed in the country.
“After being sworn in office in 2013, our government immediately initiated hectic efforts to stabilize the economy and revive growth”, he said.
“We took necessary and difficult steps to avoid predicted default, and ensure fiscal discipline and consolidation. In this regard, we undertook structural reforms, including restructuring Pubic Sector Enterprises, and other measures including reduction in un-targeted subsidies and broadened the tax base. Measures were also taken to build foreign exchange reserves, contain inflation and overcome energy shortages”, he remarked.
To address energy issues, he said that Prime Minister Nawaz Sharif set up a Cabinet Committee on Energy and developed a National Power Policy which provided a roadmap to overcome the energy crisis and fully meet the future needs of power in the country by March 2018.
“We focused on reducing the fiscal deficit, while ensuring that social safety nets and development spending are not only protected but considerably enhanced. Initiatives were also undertaken to create an enabling environment for rebuilding the confidence of domestic and foreign investors in Pakistan”, he remarked.
Ishaq Dar said “Our government’s economic policies have resulted in Pakistan’s economic turnaround which is evident in the GDP growth rebound, fiscal consolidation, low inflation, strong rupee, and overall macroeconomic stability”.
The Finance Minister said that all key macroeconomic indicators have recorded significant improvement over the past three years.
He added that improvement in fiscal sustainability, foreign exchange reserve position, and governance structures, has led to the emergence of Pakistan as a trustworthy and long-term destination for global partnerships, collaboration and investment.
“We believe that Pakistan is now well positioned to play its pivotal role in enhancing economic cooperation between CAREC member states”, he remarked.
The Finance Minister said that in order to further spur regional economic growth the government was implementing large economic development programmers.
He said that the Transit trade was currently limited to Afghanistan, while imports and exports to the Central Asian Republics from other countries, via Pakistani or Iranian ports, were are negligible.
“Intraregional transit trade through Afghanistan has been hindered by logistical difficulties in the region. Therefore, development of appropriate national and regional coordination mechanisms will be a priority area which we will address during this conference”, he remarked.
The Finance Minister said that Central Asia enjoyed abundant energy resources.
“Our resources are diverse and spread over the region. For instance, Kazakhstan has large oil and coal reserves, Uzbekistan and Turkmenistan have sizeable gas reserves, and Kyrgyz Republic and Tajikistan have substantial hydro power resources”, he remarked.
He said that all countries in CAREC are developing and our energy needs are fast increasing.
This abundant reserve of natural resources in the region, he said provides a great opportunity for regional cooperation.
All countries in the CAREC region should be able to import and export the appropriate form of energy at the requisite time to the mutual advantage of all member countries, he remarked.
He added that furthermore differences in energy sources can be optimally combined to reduce costs and mitigate supply risks.
“We should create a complementary energy market in our region. The objective of this initiative should be to increase energy security and achieve energy efficiency by optimal expansion of integrated transmission and generation infrastructure”, he said.
