IMF has said that Pakistan’s Reform programme is on right track but warned that the risks are there.
KARACHI: (Urdu Point/Pakistan Point News-Dec 20th, 2019) The International Monetary Fund (IMF) has said that Pakistan’s programme is on right track and has started bearing fruits, warning that the risks are still there which must be addressed for strengthening the economy.
The IMF that approved second tranche of $452 million under the $6 billion Extended Fund Facility (EFF) said that said that the country’s EFF programme was on track and had started to bear fruit.
“Balance growth and stability of the national economy was important for which reforms must be ensured,” said Lipton, adding that “the planned reforms that Pakistan will take includes “strengthening tax revenue mobilisation, including the elimination of tax exemptions and loopholes, and prudent expenditure policies.”
Last week, Adviser to Prime Minister on Finance Dr Abdul Hafeez Shaikh and Governor SBP Dr Reza Baqir had signed a Letter of Intent and dispatched it to the IMF headquarters for approval of the next tranche of $452 million.
The letter signed by Shaikh and Baqir had demonstrated Islamabad’s commitment that it would pursue all committed reforms and conditions so the executive board grants approval for release of next installment worth $452 million.
The statement also quoted Lipton that preparation was needed for “comprehensive tax policy reform” for timely implementation. “Social safety nets should be enhanced, because these will help improve social costs and lead towards reforms,” said Lipton adding that “flexible, market-determined exchange rate” remains essential to cushion the economy against “external shocks and rebuild reserve buffers”. He also stated that the present monetary stance was appropriately tight and should only be eased once disinflation is firmly entrenched.
He also highlighted the role of State Bank of Pakistan saying that strengthening the State Bank of Pakistan in terms of autonomy and governance was the need to implement reforms to boost up the
