ISLAMABAD: The International Monetary Fund (IMF) Tuesday said that improved macroeconomic stability as well as strengthened external buffers and public finances would provide a solid foundation for the country’s economy.
Addressing a joint press conference with Finance Minister, Senator Muhammad Ishaq Dar here at a local hotel, the Managing Director IMF, Christine Lagarde congratulated Pakistan for successfully completing its three years programme with the Fund.
She said the removal of many tax exemptions and concessions, coupled with higher tax collection, has allowed for greater public investment and social spending.
She said that about 1.5 million more poor households were benefiting from targeted social assistance than three years ago, which she said was success of the reform programme.
In addition, she said, the power outages have gradually decreased and the financial performance of the power sector has strengthened while the government has implemented a country-wide strategy to improve business climate.
However, she was of the view that although many achievements have been made but still there was much more to be done to promote economic stability.
“Much has been achieved and much more remains to be done, so this is Pakistan’s moment of opportunity to forcefully address remaining economic challenges and lay the foundation for more private sector job creation and higher living standards for all segments of the society,” she remarked.
She said that while the IMF-supported programme has been completed, Pakistan’s partnership with IMF continues through ongoing close policy dialogue and capacity building engagements, adding that the fund would continue support Pakistan to address economic challenges.
“I would like to reiterate the IMF’s support for Pakistan as the country moves forward to address its economic challenges and realize its vast economic potential,” she said.
Managing Director IMF, Christine Lagarde said that during her discussion with the government representatives, she highlighted that achieving higher and more sustainable growth would also require completing important structural reforms in the energy sector and tax policy and administration.
She said that for sustainable growth there was need to plug losses in public enterprises and making a sustained effort to improve governance and offer a dynamic and export-oriented private sector.
The MD IMF said that Pakistan needed to rely on the strength of its own policies to generate more jobs and improve living conditions.
The main priorities , he said were to reinforce Pakistan’s economic resilience and put in place reforms for higher and more inclusive growth.
In parallel, she added, focus on strengthening health, education, closing the gender gap and providing social protection can ensure that gains in living standards are widely shared.
She was of the view that Pakistan’s economic transformation could not happen without the country’s youth, who comprise about 60 percent of the population. Responding to a question over how to overcome perceived or actual corruption, she said that transparency and accountability was the best recipe to overcome the menace while to another question, she said that reducing budget deficit and broadening revenue tax base would help grow resilient and sustainable economy.
To yet another question, she said that there was no loan programme in pipeline, however added that cooperation between IMF and Pakistan would continue.
She also highlighted the importance for taking multi-prong measures to promote exports and also stressed the importance to regional tarde initiatives.
She also condoled the tragic loss of lives in Quetta attack, saying, “we are deeply sorry for families of those who lost their lives in the attack.”
Meanwhile addressing on the occasion, Finance Minister, Muhammad Ishaq Dar said that it was historic that Pakistan has successfully completed the three years IMF programme.
He said that it was the election manifesto of the Pakistan Muslim League Nawaz (PML-N) was to focus on four Es (Economy, Energy, Education and Health and eliminate Extremism) and it has carried on this policy.
He said that the economy has been turned around and now focus was on increasing growth and job creation.
Responding to various questions, the Finance Minister dispelled the impression that there was 4 percent increase in tax to GDP rate, clarifying that the ratio increased due to elimination of SROs and introduction of reforms programme.
He said that there has been considerable decrease in budget deficit and expressed the hope for further decline in it.
To a question related to upcoming PTI protest programme, the minister said that law would take its course, adding that nobody was above constitution and law.
The Finance Minister said that government has increased it spending on Public Sector Development Programme (PSDP) from Rs.300 billion in 2013 to Rs.800 billion in 2016.
Similarly , he said that on social safety net the present government has enhanced its allocations manifold.
