MANILA: The Asian Development Bank (ADB) has approved a $300 millionpolicy-based loan to help promote macroeconomic stability in Pakistan byfacilitating improved trade competitiveness and export diversification.
“While COVID-19 hit Pakistan at a critical point in its macroeconomicrecovery, the government’s ongoing efforts to ensure stability have startedshowing encouraging results this fiscal year,” said ADB Principal PublicManagement Specialist Hiranya Mukhopadhyay. “ADB’s program will supportthese efforts and help Pakistan to improve its export competitiveness—nowmore important than ever given the impacts of the pandemic.”
ADB’s program will help Pakistan recover its current account deficit in asustained manner and continue to facilitate export diversification, astatement issued by the ADB said. “It will introduce important tariff- andtax-related policy reforms to help improve Pakistan’s internationalcompetitiveness and further strengthen key institutions, includingaccreditation bodies, the Export–Import Bank of Pakistan, and the PakistanSingle Window,” it added.
“The new financing falls under subprogram 2 of the Trade andCompetitiveness Program. Under the first phase, ADB helped the governmentusher in key reforms, including reducing or abolishing tariffs and ad hocduties on a large number of raw materials and intermediate goods. Severalsteps were also taken to introduce e-commerce, strengthen key institutionsinvolved in facilitating trade, and enhance the export certificationprocess,” the statement read.
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Since fiscal year 2004, it said, Pakistan has registered a rise-and-fallpattern of export growth reflecting underperformance in its export industryand long-term decline in export competitiveness. This is compounded by lostexport growth momentum from COVID-19, which has reduced high-incomecountries’ demand for manufacturing goods and disrupted the supply of rawmaterials.
