Govt committed to fiscal discipline, PM tells IMF MD

ISLAMABAD:

Prime Minister Shehbaz Sharif on Wednesday apprised International Monetary Fund (IMF) Managing Director Kristalina Georgieva of Pakistan's improving macroeconomic indicators, stabilisation efforts and progress on structural reforms.

He underscored Pakistan's commitment to fiscal discipline, revenue mobilization, and sustainable growth.

The prime minister met the IMF MD in Davos, Switzerland, on the sidelines of the 56th annual meeting of the World Economic Forum, PM Office Media Wing said in a press release.

The meeting was also attended by Deputy Prime Minister and Foreign Minister Ishaq Dar, Federal Minister for Economic Affairs Ahad Khan Cheema, Federal Minister for Finance and Revenue Muhammad Aurangzeb and Federal Minister for Information and Broadcasting Attaullah Tarar.

The IMF managing director acknowledged and appreciated Pakistan's reform efforts and emphasised the importance of maintaining reform momentum to ensure long-term economic resilience.

Both sides exchanged views on the global economic outlook, challenges faced by emerging economies, and the importance of multilateral support in safeguarding economic stability.

Pakistan Breakfast

Prime Minister Shehbaz Sharif on Wednesday said Pakistan is going to take off rapidly in agriculture, industry, mining, Artificial Intelligence and Information Technology.

He was speaking at the 'Pakistan Breakfast' in Davos, on the sidelines of the World Economic Forum.

Highlighting government's untiring efforts, the prime minister said macroeconomic indicators are pretty reassuring, inflation rate is down from 30 percent to 5.5 percent, policy rate declined from a steep 22.5 percent to 10.5 percent, while IT exports are showing significant progress.

Emphasizing an export-led growth, Shehbaz Sharif said the government brought structural reforms in the revenue collection system. He added that tax collection to GDP ratio is 10.5 percent today, which was nine percent a couple of years ago.

The Prime Minister said agri-exports are also on the rise. He said Pakistan has signed agreements with American and Chinese companies. He said now the government has decided to move forward at lightning speed in diverse areas, including crypto, Artificial Intelligence, and IT. He said the government is extending all possible facilitation to enhance IT exports, including training and certification.

Sharif said Pakistan has strong economic connections with China and the United States. He expressed the hope that there will be more cooperation in the fields of mines and minerals, counter-terrorism, information technology and the artificial intelligence.

Sharif further said the government is encouraging the private sector and it recently completed the privatization of Pakistan International Airlines in a transparent manner. He said now the government is going to outsource airports, privatize power distribution companies, and transmission lines.

Macroeconomic indicators

Prime Minister Shehbaz Sharif said Pakistan's economy was showing clear signs of improvement and the country was moving forward with renewed confidence, as key economic indicators continued to strengthen.

Addressing an event at the Pakistan Pavilion on the sidelines of the 56th Annual Meetings of the World Economic Forum, the prime minister said Pakistan had achieved macroeconomic stability after difficult but necessary reforms and was now firmly focused on export-led growth and sustainable development.

"Our inflation has come down sharply from 30 percent to 5.5 percent, while the policy rate has been reduced from 22.5 percent to 10.5 percent," he said, adding that the improvement reflected disciplined economic management. He noted that Pakistan's IT exports had shown reassuring progress and now stood at around $3 billion annually through offshore channels.

The prime minister said that Pakistan's exports continued to face challenges but the future path was unambiguous. "Pakistan has to pursue export-led growth," he said, underlining reforms in revenue collection as a key pillar of the strategy.

He said the government had introduced fundamental changes in the tax system, which was being fully digitized. As a result, the tax-to-GDP ratio had increased to 10.5 percent from 9 percent a few years ago, calling it a significant achievement.

Highlighting sectoral opportunities, Prime Minister Shehbaz said agricultural exports had performed well in the previous year, while Pakistan was entering the mining and minerals sector.

He said agreements had been signed with American and Chinese companies to tap the country's vast untapped resources in Gilgit-Baltistan, Azad Jammu and Kashmir, Khyber-Pakhtunkhwa and Balochistan.

He said Pakistan was also moving rapidly in emerging fields such as information technology, artificial intelligence and crypto, terming the country's large youth population both a challenge and an opportunity.

The prime minister said the federal and provincial governments were jointly implementing programs to empower youth through vocational and technical training. He cited the role of the National Vocational and Technical Training Commission (NVTTC), noting that its programs were subject to third-party audits and international certification, enabling Pakistani youth to secure productive employment in Gulf countries and beyond.

On foreign relations, he said Pakistan enjoyed strong economic ties with China and was building cooperation with the United States, particularly in mining, minerals, counterterrorism and technology.

Prime Minister Shehbaz also highlighted transparent privatization efforts, including Pakistan International Airlines, and said further privatization and outsourcing were planned in airports, power distribution companies and transmission lines.

Referring to the IMF programme, he said Pakistan had adhered to stringent conditions in letter and spirit, adding that the Fund was now citing Pakistan as a success story for developing countries.

As regards structural reforms, the prime minister said the government had taken tough decisions to shut down loss-making and inefficient state entities. He said Utility Stores Corporation, which had been a burden on the national exchequer and offered substandard goods, had been closed to save public money. He added that the Pakistan Agricultural Storage and Services Corporation (PASSCO) and the Pakistan Public Works Department (PWD) had also been shut down, resulting in savings of billions of rupees despite resistance from vested interests.

"We are at a point where Pakistan is about to take off," he said, stressing unity, transparency and sustained reforms as essential to achieving long-term growth and prosperity.

Palestinian PM

Prime Minister Shehbaz Sharif, Wednesday, met with Palestinian Prime Minister Mohammad Mustafa, on the sidelines of the World Economic Forum (WEF) annual meeting in Davos.

The Palestinian prime minister met with the prime minister and introduced himself, PM Office Media Wing said in a press release.

He expressed his gratitude to the prime minister for Pakistan's consistent, principled and firm support to the Palestinian people.

He also thanked Pakistan for its role at the global fora in support of Palestine and its cause.

(With addition from Radio Pakistan)