ISLAMABAD - Prime minister Shahid Khaqan has said that Pakistan will neither reach out to the International Monetary Fund (IMF), nor devalue its currency.
He conceded that declining reserves is a serious issue but said that Pakistan will look to solve it within its own resources. "I don’t think the IMF program is something that we intend to pursue."
Abbasi also accepted that falling exports and rising imports were widening the current account deficit but, he said, falling exports is a worldwide trend while the rise in imports "actually signals growth in the economy because the people have more money to spend on luxury goods."
Pinning economic hopes on the China-Pakistan Economic Corridor (CPEC), Abbasi said that the project will boost Pakistan's infrastructure which he termed "the basic ingredient" of any economy.
"It’s really a game-changer and it will have multiplier effect. It will attract more investment, it will attract more projects. So, it’s really something that we feel will pay very high dividends for Pakistan."
According to the Arab News article, Abbasi rejected suggestions that large investments would give China undue influence in Pakistan. “It’s a two-way relationship,” he said.
He added that Pakistan does not see the CPEC as being "a threat of any kind". "They have equity investments here but mostly, it is debt or loans of some kind and it is basically focused on certain areas."
"Pakistan’s economy has the capacity to repay those loans. They have been targeted very carefully and the economic dividends will pay for more than the loans are worth. So, it’s an economic relationship in that sense."