Govt says 3.3% GDP growth given to IMF was a ‘typo’

Insists expected growth in 2013-14 is 4.3% and not 4.1% as announced earlier.

ISLAMABAD:

After being caught out giving incorrect economic growth rate for its first fiscal year, the government said on Saturday that the 3.3% growth rate reported to the International Monetary Fund (IMF) was a ‘typo’ and an ‘inadvertent oversight’.

This came after The Express Tribune and former State Bank of Pakistan governor Dr Muhammad Yaqub highlighted that the government, in its policy document submitted to the IMF, had admitted that the actual growth rate was 3.3%, and not 4.1% announced earlier.

While the finance ministry insists it was a typo, the fact of the matter is that the government has never said that the GDP growth rate would be 4.3% in FY2013/14. Additionally, its earlier admission of 3.3% in front of the IMF was in line with the global lender’s projection of 3.3% growth rate for the last fiscal year.

“Due to an inadvertent oversight the expected GDP growth of 4.3% was mentioned as 3.3%” for 2013-14, according to a handout issued by the finance ministry late Saturday night after it came under scathing criticism for concealing the real health of the national economy.

The Pakistan Tahreek-e-Insaf has already announced plans to move a privilege motion against the government for “concealing facts from Parliament”.

The finance ministry said a section of the press has reported discrepancies in the figures stated in the Memorandum of Economic & Financial Policies (MEFP) for the third quarter review under the IMF bailout program, posted on its website on July 9, 2014. On perusal of the memorandum it transpired that due to a typo instead of 4.3% growth rate, it mentioned 3.3%, it added.

It is not the first time the incumbent government has tried to hide behind ‘typo’. Earlier the Election Commission of Pakistan (ECP) also conceded that there was an error in counting the ballots in NA-68 (Sargodha) – one of the constituencies from where Prime Minister Nawaz Sharif had won the 2013 general elections.

According to the poll body, it detected a ‘typing error’ where a returning officer, while compiling the results had written 7,879 instead of 779 on the final result sheet. PTI chief Imran Khan has alleged massive rigging in this and many other constituencies.

The finance ministry further said that whereas for FY2014-15, the GDP growth of around 4% was mentioned instead of 5% - yet another ‘typo’. It added that the same clarification has also been issued to the IMF.

Sources said it has never happened in the history that a clarification in the MEFP was issued after IMF’s Board of Directors’ meeting that approves the loan tranches on the basis of information given in the MEFP.

Asked for proof the government wasn’t lying again and that if the IMF has accepted Pakistan’s clarification, Director General Media Nadeem Kiani insisted the finance ministry didn’t lie. Neither he replied when asked for proof the finance ministry has sent a clarification to the IMF.

He chose to ignore when asked if the government has taken any action against those responsible for the ‘inadvertent mistake’. In this case, Additional Secretary External Finance Shahid Mahmood and Secretary Finance Dr Waqar Masood were responsible for carefully reading the MEFP before issuing it to the IMF.

Sources said there can never be a typo in the MEFP, particularly in the very first paragraph. Additionally, the structure of the sentences suggests there was no ‘inadvertent oversight’ and the government correctly admitted its mistake and reported 3.3% growth rate.

“Preliminary estimates show that the aggregate output grew above 4% in the first half of FY2013/14 over the same period last year. We now expect that the GDP will expand by about 3.3% in FY 2013/14, while in the next fiscal year, the expansion should accelerate to around 4%,” reads the MEFP.


Published in The Express Tribune, July 13^th, 2014.