Pakistan

Pakistan's economy has improved, says IMF

IMF advises government to bolster revenue by broadening tax base and improving compliance to reduce its public debt

Web Desk March 12, 2015

the key interest rate was slashed by pakistan 039 s central bank in january to 8 5 per cent citing a slowdown in inflation stock image

The key interest rate was slashed by Pakistan's central bank in January to 8.5 per cent citing a slowdown in inflation. STOCK IMAGE

The International Monetary Fund (IMF) announced on Wednesday that Pakistan's economy had improved due to prudent monetary and fiscal policies, strong capital inflows, robust remittances from abroad and lower oil prices, The Wallstreet Journal reported.

“The authorities have made progress with consolidating macroeconomic stability, strengthening public finances and rebuilding foreign-exchange buffers,” Director of the IMF’s Middle East and Central Asia department Masood Ahmed said in a statement following a recent visit to Islamabad and Lahore.

Ahmed went on to say that economic growth was strengthening and inflation was slowing as a result.

Read: Bailout programme: IMF likely to release $550 million tranche

The key interest rate was slashed by Pakistan's central bank in January to 8.5 per cent citing a slowdown in inflation. Other factors, including plummeting oil prices and declining global prices for other commodities have also contributed to the betterment of the economy.

Ahmed advised Pakistan's government that further bolstering the revenue by broadening the tax base and improving compliance would allow it to further reduce its public debt while increasing its spending in key sectors, namely health and education.

Read: IMF forecasts 5% growth for Pakistan in 2015

The government should also “reinforce and build on recent stability gains to work towards achieving higher, sustainable and inclusive economic growth," Ahmed added.

Read: Need for tax reforms: Development budget will be cut by a tenth, projects IMF

The IMF director noted that the longstanding energy crisis across the country should be addressed as a priority for the government. Other priorities for the government should also include restructuring and privatising public-sector enterprises, proceeding with investment-climate and trade reforms as well as continuing with financial-sector reforms.

COMMENTS (8)

Alina | 9 years ago | Reply Good job PMLn. Raider and Ebaad our paid PTI media wing reps.

Sohail | 9 years ago | Reply Looks like the slap on the Finance Minister's head during the PTI rally really turned things around..We need more of these slaps from our people to the politicians!