WASHINGTON - The World Bank has warned Pakistan that its increasing fiscal deficit could put macro-economic management at risk and said it needs around USD 17 billion to cover the rising current account deficit and debt payments in the year 2018.
“Pakistan is facing headwinds in the external sector and a rising fiscal deficit that could put macro-economic management at risk,” the Bank said after it concluded talks with a visiting Pakistani delegation on the sidelines of the annual meetings of the International Monetary Fund and the World Bank .
“This has resulted in increased external financing needs of 5-6 per cent of GDP in financial year 2018, or around USD 17 billion, to cover rising current account deficit and debt payments,” the bank said.
The Pakistani delegation met with a World Bank team led by Annette Dixon, Vice President, South Asia region.
On the macro-economic outlook, the discussions acknowledged that Pakistan has done well in stabilising its economy over the past four years, and in achieving 10-year high growth of 5.3 per cent in financial year 2017, a statement said.
Following the talks, the bank said, “it would continue to support” Pakistan to implement broad economic reforms and address current risks towards achieving its development aspirations.
The Pakistani delegation included Shahid Mahmood, Secretary, Finance Division, Tariq Bajwa, Governor the State Bank of Pakistan, and Arif Ahmed Khan, Secretary of the Economic Affairs Division.