Outlook: Finance minister briefed on debt sustainability

Dar says positive S&P upgrade result of prudent govt policies

ISLAMABAD: Finance Minister Ishaq Dar held a meeting on Wednesday to review the overall debt profile of the country.

The finance secretary and director general Debt Office briefed Dar, saying that Pakistan’s debt sustainability has improved during the present government’s tenure.

The overall borrowing rate has shown a decrease due to macroeconomic stability and improved credit ratings by international rating agencies.

The meeting was attended by senior officials of the Ministry of Finance

Dar appreciated the efforts of the Debt Policy Coordination Office and  said that the government’s good management and prudent economic measures have resulted in Standard & Poor’s upgrading Pakistan’s long-term credit rating from B-to B with stable outlook.

He said that in their report Standard & Poor’s have acknowledged steps taken by the present government for overall improvement in Pakistan’s economic indicators, implementation of reform agenda and good governance.

On Tuesday, S&P Global Ratings raised its long-term sovereign credit rating on Pakistan by one notch to ‘B’ from ‘B-’.

JS Global analyst said that the upgrade was very much on the cards given the successful completion of the three-year International Monetary Fund reform programme by Pakistan, where reasonable progress was achieved to address structural inefficiencies and combat external and domestic security risks.

S&P expects further gradual gains in fiscal consolidation, leading to fiscal deficit of below 3% of GDP by 2018, and also now expects average annual GDP growth to clock in at 5% over 2016-19 from its earlier estimate of 4.7%.

Published in The Express Tribune, November 3^rd, 2016.

Like Business on Facebook, follow @TribuneBiz on Twitter to stay informed and join in the conversation.