Next IMF programme to be last, Asad Umar tells stockbrokers
Federal Minister for Finance, Asad Umar says the next International Monetary Fund (IMF) programme will be Pakistan’s last.
He made this statement during a meeting with stockbrokers at the Pakistan Stock Exchange in Karachi.
The Finance Minister had met the traders to allay their concerns about the market and the economy.
He said that he arrived to especially meet the traders to dispel their reservations about the economy and the market.
“There is tremendous growth in the stock market,” Umar told the market representatives.”
But he agreed that measures need to be taken in order to improve the market’s recent performance.
The Finance Minister said that the present government had decrease gas rates for Punjab’s export industry. Umar urged business community to play their effective role to improve export development.
Tax imposition on real estate sector was essential for the revival of the economy. He said that FBR should come up with the system for “Neat and Clean” valuation of the property.
The government has decided to approach the IMF for a bailout package. It will be an economic recovery programme.
“We will work for the betterment of the capital market and improve the overall atmosphere for investment,” the Minister promised.
He said that the stock market’s fortunes are directly linked with the economy’s health.
“If the economy will grow, the market will grow.”
The Minister said that we have an $18 billion deficit and $9billion debt repayment this year. Segments of the society will have to bear this pain. If I ignore this then the pain will be far greater than that.
After taking monetary and fiscal measures, our financing gap for this year will be around $12billion. We are trying to solve through a package. It will include on-time inflows as well as elements of trade financing,” Umar said.
“In my opinion, year 3 of the present government will be our break-even point. After that you will see growth,” Umar predicted.
The Finance Minister defended his policies aimed at curbing imports. He said,
“The country was heading rapidly towards bankruptcy, I have to save 210 million Pakistanis.”
After taking into account the current situation, the government has decided to approach the IMF for an “Economic Recovery Programme”.
Clarifying the new policies.
The Finance Minister told his audience that the new policies may seem tough, but they have started mending the economy.
“Right now our cash-to-deposit ratio is 37%, he said. We are targeting this ratio to be brought down to 25%.”
“If we manage to do this, Rs2 trillion’s worth of credit creation capacity will be enhanced. This is where the financing for the housing scheme will come,” Minister added.