- Aurangzeb says the World Bank will give Pakistan a grant instead of a loan.
- The finance czar says: We will try to make this IMF program our last.
- The Governor of the State Bank of Pakistan says that dependence on foreign loans has decreased.
ISLAMABAD: Finance Minister Senator Muhammad Aurangzeb said on Sunday that his meetings with stakeholders in the US remained positive, adding that stakeholders appreciate low inflation in Pakistan.
He made this statement after concluding his visit to Washington to participate in the annual meetings of the World Bank and the International Monetary Fund from October 21 to 26.
The Finance Minister held a series of meetings with leaders of several international financial institutions and authorities, including rating agencies, multinational banks, the World Bank, the International Monetary Fund and the Asian Development Bank.
Aurangzeb said the US business community wants to invest in Pakistan as all rating agencies have said that the economy is moving in the right direction.
He also informed the media that the World Bank will give Pakistan a grant instead of a loan. He said that the government will try not to obtain a loan from the International Monetary Fund anymore.
“We have had constructive discussions with the IMF. We will try to make this IMF program our last one,” he said, adding that thanks to the government’s initiatives, the country was moving towards macroeconomic stability.
The finance czar also warned that the government may have to make difficult decisions to boost the economy.
“We are abolishing the term non-filer. Non-applicants will not be able to buy cars and properties and we will need a legal cover for this,” he said.
The Finance Minister said that they had worked continuously for six months for economic improvement and that reforms in the Federal Board of Revenue (FBR) were a step in the same direction. He said that the ratio of taxes to GDP will rise from 9% to 13%.
He added that the country’s foreign exchange reserves exceeded $11 billion.
The IT and agriculture sectors have game-changing status for the country’s development, so we have to boost their exports, Aurangzeb said.
Regarding privatization, he said that three electricity distribution companies will be privatized in the first phase.
Meanwhile, State Bank of Pakistan Governor Jamil Ahmed said the country’s debt stood at $100 billion in June 2022, falling to $98.3 billion. He added that dependence on foreign loans had been reduced.
On the other hand, the Finance Minister held various meetings with the leadership of various global finance companies on Saturday as well.
FinMin applauds VISA’s efforts
Separately, during a meeting with VISA Regional President Andrew Torrey in Washington, FinMin Aurangzeb expressed appreciation for VISA’s commitment to modernizing Pakistan’s payments ecosystem, including supporting local payment companies such as 1Link.
He praised Visa’s efforts in promoting financial inclusion and supporting entrepreneurs in Pakistan.
The two parties agreed on the importance of providing more routing options to customers and ensuring equal opportunities in processing local transactions.
Mohammed Kalala, Global Head of Corporate and Investment Banking at Natixis, visited Washington DC and was briefed on Natixis’ operations and its strong presence in the infrastructure, renewable energy, transportation, aviation, telecommunications and technology sectors.
The two sides discussed partnership opportunities with Gulf investors, especially from Saudi Arabia, to provide financing and advisory support for investments in Pakistan.
Kalala noted that the bank aims to cooperate with a select group of leading Pakistani companies to facilitate investments.
Both sides agreed on the importance of maintaining continued engagement in the future.
Vice President and Global Head of Government Affairs and Public Policy at Google, Karan Bhatia, also visited Aurangzeb in Washington.
During the meeting, Karan Bhatia provided an overview of Google’s recent activities and commitments in Pakistan, along with its plans to deepen investments and make tangible economic contributions in the country.
It raised regulatory, legislative, communications and financial concerns. The Minister of Finance assured full support in this regard.
Pakistan launches first Panda bonds in China
In his meeting with Chinese Vice Minister of Finance Liao Min in Washington, the Finance Minister reiterated the comprehensive strategic cooperative partnership between Pakistan and China.
He thanked the Government of China for its unwavering support for Pakistan’s socio-economic development and assistance in securing the IMF’s Extended Fund Facility.
Aurangzeb added that Pakistan is keen to learn from China’s experience in economic reforms. He also welcomed BYD’s decision to introduce electric vehicles in Pakistan.
The minister said that the government aims to launch the inaugural panda bonds in the Chinese market to diversify its financing base.
The Finance Minister noted that the majority of Chinese companies are interested in expanding their investments and increasing job opportunities in Pakistan.
He stressed that “the government is committed to providing guaranteed security for Chinese workers.”
He also asked the Chinese side to raise the limits under the currency swap agreement to 40 billion Chinese yuan.
The two sides stress the need to settle payments online and integrate payment systems in the two countries.