LA­HORE

The Pak Banker - - FRONT PAGE -

Pak­istan will see its an­nual eco­nomic growth rate surge to 7 per­cent in two years as it reaps the ben­e­fits from China and oth­ers in­vest­ing more than $40 bil­lion in in­fra­struc­ture, ac­cord­ing to the Fi­nance Min­istry's top bu­reau­crat. Prime Min­is­ter Nawaz Sharif's govern­ment is show­ing in­vestors he's se­ri­ous about im­ple­ment­ing eco­nomic re­forms by head­ing to­ward com­ple­tion of an In­ter­na­tional Mon­e­tary Fund loan pro­gram, Fi­nance Sec­re­tary Waqar Ma­sood Khan said in an in­ter­view Thurs­day.

"We still face chal­lenges in achiev­ing a higher growth," Khan said. "Com­pared to our po­ten­tial, our growth rate is sig­nif­i­cantly low." Sharif is tar­get­ing growth of 5 per­cent for the cur­rent fis­cal year end­ing in June, an eight-year high, as he works with the IMF to turn around an econ­omy hin­dered by en­ergy short­ages and ter­ror­ism. China's plans to in­vest $46 bil­lion in an eco­nomic cor­ri­dor are fu­el­ing op­ti­mism that growth is set to reach new heights.

Since Pak­istan started tak­ing IMF loans in the 1950s, it has strug­gled to see them through. It came close un­der for­mer mil­i­tary pres­i­dent Pervez Mushar­raf, who didn't take the last in­stall­ment of that loan.

Khan said com­plet­ing an IMF loan pro­gram "is al­ways very tough." He de­clined to say whether the govern­ment would seek to bor­row more from the IMF in the fu­ture. "We will cross the bridge, when we come to it," he said. Khan doesn't see hur­dles in sell­ing a stake in na­tional car­rier Pak­istan In­ter­na­tional Air­lines Corp., a con­di­tion for the re­lease of IMF loan in­stall­ments. Protests by the na­tional car­rier's em­ploy­ees last month halted its flight op­er­a­tions.

"It is ev­i­dent that there is more in­ter­ac­tion re­quired be­tween the stake­hold­ers," he said. "The govern­ment's com­mit­ment to bring strate­gic part­ner in PIA and other power com­pa­nies is there and would be ac­com­plished through a con­sul­ta­tive process." The Sharif govern­ment has raised about $1.5 bil­lion sell­ing its re­main­ing stakes in banks such as United Bank Ltd. and Habib Bank Ltd. That has helped in­crease the cen­tral bank's for­eign re­serves to about $16 bil­lion, Khan said.

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