ISLAMABAD - IMF Resident representative Tokhir Mirzoev said Pakistan required to initiate immediate reaction in policy actions to resolve challenges being faced on the budget and external sector side.
Mirzoev was doubtful about the success of government’s plan to raise customs duty for restraining imports. When queried about if Pakistan could seek another bailout, Mirzoev remarked that policy makers were required to carry out appropriate measures for fixing the fiscal and external imbalances that were plaguing the country’s economy.
When asked about his view on fiscal situation, he said immense effort would be required to meet this financial year’s fiscal target, and the key challenge would be revenue mobilization. He added that policy makers have to find resolutions for these shortcomings of the fiscal system, which is prone to shocks.
He remarked Pakistan’s economy was facing challenges a several fronts and a lack of supportive policy mix could have a major impact in this financial year 2017-18 on the fiscal and external front.
Mirzoev said not everything was wrong with Pakistan’s economy and growth has been rising too. He said increasing exports was necessary to expedite growth and balancing this growth was necessary to avoid any hiccups in balance of payments.
He went on to add that despite Pakistan’s economic growth, the imbalances on external and fiscal fronts rose during last FY 2016-17 and need urgent attention of policy makers.
While sounding positive about the economic data for August released by SBP, he said containment of import growth, rising exports, FDI and remittances had released the stress on the balance of payments.