Pakistan's reform process bearing fruit: IMF
International Monetary Fund (IMF) has praised Pakistan's efforts to rein in its budget deficit and build its foreign exchange reserves were paying off, the Wall Street Journal (WSJ) reported. According to the international newspaper, in an assessment of the South Asian nation's economic reform programme, the multilateral argued that Pakistan "has significantly reduced near-term risks."
The Journal further reported that IMF praised Pakistan's progress in implementing social programmes and its drive to restructure loss-making public enterprises, to advance energy-sector reform and improve the business climate.
It said that decisive progress in those areas "will help strengthen competitiveness and resilience of the economy and transform Pakistan into a dynamic emerging-market economy," Wall Street Journal further said. Pakistan was set for continued strong economic growth, the IMF said, forecasting that GDP will increase by 4.5% this fiscal year, which runs from July to June.
Growth has been "helped by macroeconomic stability, low oil prices, planned improvements in the domestic energy supply, and investment related to the China- Pakistan Economic Corridor," the IMF noted. The report said that country's inflation rate dropped to 1.8% in July, but was expected to rise in coming months, if commodity prices stabi- lize, as expected, the IMF said.
The IMF also noted that Pakistan narrowly missed some budget deficit, tax revenue and government borrowing targets recently. The Wall Street Journal said foreign exchange reserves at the state bank rose at a healthy pace, the IMF added, reaching $13.5 billion at the end of June. The country still has a great deal of work ahead of it, though, the IMF explained:
"In the period ahead, consolidating these gains and focusing the reform efforts on overcoming structural challenges still facing Pakistan will be important to achieve higher exports, investment, jobs, and growth.", the WSJ said.