Team to apprise IMF, WB of RGST, power reforms

A high-level economic team will be briefing the International Monetary Fund and World Bank in Washington next week.

ISLAMABAD: A high-level economic team, led by Federal Finance Minister Dr Abdul Hafeez Shaikh, will be briefing the International Monetary Fund (IMF) and World Bank (WB) in Washington next week, on several important issues, including the reformed general sales tax and the energy plan, according to a senior official from the Ministry of Finance.

The team, including the State Bank Governor Shahid Kardar and Finance Secretary Salman Siddique, will leave for Washington on October 6 and participate in the annual meetings of the IMF and WB scheduled to be held on October 8-10. The team will hold separate meetings with IMF and WB executives on the sidelines of the summit and inform them of progress on the implementation of RGST.

Pakistan has fulfilled most of the conditions set forth in the previous talks held with the IMF, including a formal agreement between the centre and provinces on the implementation of RGST on services. A mechanism for the implementation of RGST on services has been agreed upon, according to sources.

Meanwhile, there is considerable progress on power sector reforms, disbanding of Pepco and empowerment of distribution companies, which will be communicated to the IMF and WB officials.

The prime minister has given go-ahead for dissolution of Pepco, electricity tariffs will continue to be revised throughout the year and shares of power companies will be sold in stock exchanges to help them clear circular debt.

These measures will help secure a $1 billion package for the energy sector from the IMF and Asian Development Bank (ADB) and they will also assist in receiving the next tranche of $1.7 billion from the IMF’s Standby Arrangement.

Published in The Express Tribune, October 1^st, 2010.