Govt keen on promoting microfinance sector

PM aide stresses sector can bring underprivileged out of poverty

ISLAMABAD: The government is committed to increasing capacity of the microfinance sector to achieve maximum benefits out of minimum resources, said Adviser to Prime Minister on Finance and Revenue Abdul Hafeez Shaikh on Wednesday.

Addressing a two-day microfinance conference, the adviser said a stable economy was critical for the promotion of microfinance sector and due to timely and effective measures by the government the economy had become stable now.

“The underprivileged segment of society can be brought out of extreme poverty by promoting the microfinance sector,” he remarked.

Shaikh pointed out that due to huge fiscal deficits in the past, the provision of loans to the private sector had been affected. However, he said the fiscal deficit in first five months of the current fiscal year not only went down, but the fiscal balance also recorded a surplus if interest payment was not taken into account.

“For the first time, the primary fiscal balance is in surplus now. Our revenues are more than our expenditures, which is a positive sign for the economy,” he added.

The adviser declared that the government would bring down the cost of doing business, especially for the microfinance sector.

Talking about the government’s achievements in terms of macroeconomic indicators, Shaikh said almost a 10% increase was recorded in exports in November while imports dropped considerably, which resulted in 36% contraction in the trade deficit.

He said revenues of the government grew 17% in first five months of the current fiscal year as compared to the same period of last year.

“Owing to the positive macroeconomic indicators, more and more investors from abroad are attracted towards Pakistan, which is reflected in portfolio investments of around $1 billion in the current fiscal year,” he pointed out. “If all institutions perform well, there will be no need to go back to the IMF.”

The adviser said foreign direct investment surged 236% in the previous month whereas domestic investors were also expressing interest, evident from the fact that the country’s stock market underwent a significant positive change and crossed the 40,000-point barrier.

“Bloomberg has reported that in dollar terms, the PSX (Pakistan Stock Exchange) has become the best performer in the world in the past three months.”

Shaikh added that non-tax revenues had also posted a record increase of over 100% and hoped that the government would easily surpass the target of collecting Rs1,200 billion in non-tax revenues by the end of current fiscal year.

He also pointed to the upgrade of Pakistan’s credit rating outlook from negative to stable by the Moody’s which, he said, sent a positive message across the globe.

Published in The Express Tribune, December 5^th, 2019.

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