News
Sunday, November 20, 2011
Pakistan’s economy facing serious challenges, needs urgent care: IMF* Fund says govt should immediately resolve energy crisis for economic growth
By Sajid Chaudhry
ISLAMABAD: The International Monetary Fund (IMF) said on Saturday that Pakistan’s economy was facing serious challenges, including energy crisis and declining investment and would not be able to move on the economic front without resolving these issues.
The IMF identified that Pakistan was facing some short-term issues, and stressed the need for addressing the issues on a long-term basis.
Addressing a press conference after attending a seminar on Revival of Pakistan Economy, IMF Assistant Director Adnan Mazarei, said that Pakistan’s external account position would not be as good as it was last year. “We are going into difficult global situation and Pakistan has to adopt a policy mix to achieve growth and employment generation,” he said.
He said that there was a need to focus on fiscal growth, the banking sector and the energy sector on a long-term basis.
Mazarei said that long-term issues were very simple as investment required safe and transparent regulations, the elimination of the energy crisis and investment in the human development sector to achieve sustainable and long-term growth.
He said that the government had to bring about structural and management changes in the power sector to resolve the problem because price changes would not improve the situation.
Equitable taxation among all sectors of economy, broadening of the tax base and honest unitilisation of tax proceeds would help Pakistan make the business community confident and move towards sustainable growth. The broadening of tax base was critical, but needed to be done in an equitable way. He said that fiscal imbalances were also needed to be addressed because the global economy was facing a difficult situation.
The IMF representative said that they had positive and constructive talks with the Pakistan economic team about the economic situation of the country during the Article IV discussion in Dubai.
Finance Minister Dr Abdul Hafeez Sheikh said that the role of the government representatives during the daylong seminar was to listen to the economists, business community and development partners and share with them the steps taken for economic reforms in the country. He said that the economic team held a very constructive discussion with the IMF during the Article IV discussion in Dubai on economic reforms on policy mix to help them move on to a high-growth path.
Hafeez Sheikh said that the first four months of the current fiscal year were very positive with exports going over $6 billion, which were 23 percent more than the same period of the previous year and remittances, $4.2 billion, 23 percent up by the same period of the last year. The minister said that the growth in taxes during the first four months was 28 percent with a total collection of Rs 509 billion compared to the same period last year.Courtesy www.dailytimes.com.pk