Pakistan government significant gains on the economic front

Pakistan government significant gains on the economic front

ISLAMABAD - Adviser to Prime Minister on Finance and Revenue Abdul Hafeez Shaikh on Wednesday said the government was committed to increasing production capacity of micro-finance sector to grab maximum benefits out of minimum resources.

Addressing a two-day micro-finance conference here, the adviser said that stable economy was pivotal for promotion of micro-finance sector and due to timely and effective measures by the government, the economy had become stable now.

He said the unprivileged segment of the society could be brought out of extreme poverty by promoting micro-finance sector.

Hafeez Shaikh pointed out that due to huge fiscal deficits in past, the provision of loans to private sector got affected.

However, he said the fiscal deficit during first five months of current fiscal year not only went down as compared to the last year, but it had gone in surplus if the interest payment was not taken in account.

“For the first time, the primary fiscal balance is in surplus now. Our revenues are more than expenditures, which is a positive sign for the economy,” he added.

The adviser also said the government would bring down the cost of doing business especially in micro-finance sector.

Talking about the government’s achievements in macroeconomic indicators, he said last month (November), almost 10% increase was recorded in exports while imports declined considerably, which resulted in contraction of the current account deficit by over 36%. He said revenues had also increased by 17% in the first five months of current fiscal year as compared to the same period of last year.

“Due to positive macroeconomic indicators, more and more people (investors) from abroad are attracted towards Pakistan as evident from portfolio investment of around $1 billion during the current fiscal year.”

If all institutions performed well then there would be no need to go back to the IMF again, he added The adviser said last month the foreign direct investment also witnessed a record increase of 236%, whereas local investors were also showing more trust as evident from the fact that the country’s stock market witnessed a significant positive change and crossed the 40,000 barrier.

“Bloomberg has reported that in dollar terms, PSX (Pakistan Stock Exchange) have proved to be the best performer in the world during the previous three months.”

Hafeez Shaikh said non-tax revenues had also posted a record increase of over 100% as compared to the same period of last year and hoped that the government would easily surpass the target of collecting Rs1,200 billion non-tax revenue by the end of current fiscal year.

He said Moody’s, the leading international rating agency, normally compared the economic performance of different countries. However, on Monday it upgraded Pakistan’s economic outlook from negative to stable which sent a positive message across the globe about the country, he said.