Pakistan needs new crop of entrepreneurs: SBP governor

Assures new businesses of support, says existing exporters are not willing to work hard

KARACHI: State Bank of Pakistan (SBP) Governor Ashraf Mahmood Wathra has said that Pakistan’s exporters have earned a lot and now they are not ready to work hard.

“Pakistan needs new crop of entrepreneurs to increase its exports. We (the SBP) will support new entrepreneurs,” he said while talking to office-bearers of the Karachi Chamber of Commerce and Industry (KCCI) at its head office on Monday.



“Pakistan’s export model is too old, it still revolves around the ideas of the 1950s and 1960s,” said Wathra while elaborating why the country was even unable to sustain its exports.

The SBP governor also defended its decision to impose 100% cash margin on the import of certain consumer items to discourage their imports.

“We talk a lot about the need for sacrifices for the country. Contrary to this, today every other sector is requesting us to spare it while continue to apply it to other sectors,” he said, referring to the SBP’s move of imposing the 100% cash margin.

Wathra was of the view that the country had been unnecessarily importing luxury goods for the past few years in the wake of the cushion provided by a sharp decline in the oil import bill. Therefore, there was a need for some kind of restriction on the import of those items without which the country could easily survive.

The central bank governor insisted that he was aware of the difficulties faced by the exporters in trade with Iran. Both countries would soon be able to use their commercial banks for trade after the signing of a few agreements by the central banks of Iran and Pakistan.

He revealed that the SBP was working with the federal government on establishing an Exim bank with the assistance of the Asian Development Bank (ADB).

Wathra said the country had been gradually increasing its gross domestic product (GDP) growth over the last three years. “We are going to achieve over 5% growth rate this year, but our target is 7% to create enough jobs for our growing population.”

He boasted that the central bank was successfully helping commercial banks in disbursing more loans to the agriculture sector and small and medium-sized enterprises (SMEs).

He told the business community that they could bring undeclared money to Pakistan and for that they did not need any amnesty scheme.

After the implementation of a common reporting agreement between Pakistan and member-countries of the Organisation for Economic Cooperation and Development (OECD), the country would be in a better position after 2018 to have its own database of individuals who had undeclared money outside Pakistan, he added.

Earlier, KCCI President Shamim Ahmed Firpo pressed the SBP governor to reconsider its policy of 100% cash margin on certain goods as it had increased the cost of these products.



He also highlighted the problems faced by the exporters who wanted to engage in trade with Iran, but were unable to do so because of the absence of banking channels between the two countries.

Former KCCI president Anjum Nisar said Pakistan’s manufacturing sector was consistently under pressure and that was the reason why exports of the country had been declining for the past few years.

Published in The Express Tribune, March 28^th, 2017.

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