ISLAMABAD: Finance Minister Senator Muhammad Aurangzeb on Tuesday expressed confidence that the International Monetary Fund Board will approve the $7 billion, 37-month Extended Fund Facility (EFF) at its meeting today (Wednesday). “Pakistan has successfully entered into a 9-month SBA (Stand-by Arrangement) with the IMF and today (Wednesday) we have a board meeting here in the US. We strongly hope that the board will approve the 37-month, $7 billion programme,” he said at the “High Level Private Sector Dialogue – CPEC-II and the Region” virtually via Zoom. The event was organized by the Pakistan Regional Economic Forum. The finance czar said that Pakistan had committed to structural reforms under the program and that it must continue with the reform agenda, be it in the areas of taxation, energy, state-owned enterprises or privatisation. “We’ll stay the course,” he decided. He expressed gratitude to China for its support of the fund’s program as an independent permanent partner of the country. According to the minister, Pakistan’s economic improvement that started in the last fiscal year continued in the first quarter of this fiscal year with remarkable developments in various economic indicators. He said currency and foreign exchange reserves are stable, with two months of import cover, while inflation has slowed, leading to lower exchange rates and ultimately KIBOR to benefit the industry. Aurangzeb said the government recently rejected Treasury Bills (T-bills) and Pakistan Investment Bonds (PIBs), saying its decision was to send a clear signal that the government was no longer desperate for domestic borrowing. “If needed, the government will borrow domestically on its own terms, signaling the banking sector to lend to the private sector,” he said. However, he said the inflow of investment in terms of debt and equity is welcome as it would bring foreign direct investment (FDI) into the country. The finance minister attached great importance to macroeconomic stability and said that the foundations have been laid to support economic stability. “The China-Pakistan Economic Corridor Phase II is now underway, building on the infrastructure development of Phase I,” Aurangzeb said. The minister explained that Phase I focused on building corridors and investing in roads, ports and energy. “However, the next step is to monetize this infrastructure, and while we’ve missed the momentum, it’s not too late to move forward.” “This initiative, called the New Silk Roads, aims to attract investment partners around the world. The private sector will drive growth, with the government providing the supportive policy framework. Besides, the Minister called on Saudi Pak and Pak-China Development Finance Institutions (DFIs) to facilitate cross-border investment and development of corridors between Pakistan and its sister countries. He urged them to seize this opportunity to become catalysts for business growth and bilateral investment and serve as levers through which business can be moved forward.
