IMF says reforms will help strengthen fundamentals of Pakistan economy

WASHINGTON, Oct 7 (APP): Pakistan has made some progress in stabilizing the economy in difficult circumstances but it needs to stick to bold reforms to stregthen the fundamentals of the economy, the International Monetary Fund said Thursday.  The Fund also signaled its openness to negotiating another program for the South Asian country and said fifth review of the the ongoing $11.3 billion program is possible later this year if sufficient progress is made.The last tranche of $ 1.7 billion will be reimbursed to Pakistan after the fifth review is completed. Adnan Mazarei, IMF Mission Chief to Pakistan, underlined the importance of keeping the inflation under check and pursuing tax reforms including general sales tax.
He said all these decisions are for Pakistanis to make in their interest.“In the past couple of years Pakistan has had some success in stabilizing economy but these should not be temporary,” Adnan Mazarei, IMF Mission Chief to Pakistan said.
He said the current Pakistani economic team is very much conscious of the importance of reforms for solid progress. In answer to a question about the possibility of dicussing a new package for Pakistan, he said it could be discussed anytime if Pakistan wants such a package.
Mazarei praised Islamabad’s bringing down inflation down to single digits but noted lately it has crept back. Mazarei, who is meeting Pakistani Finance Minister Dr Abdul Hafeez Sheikh and his team during the IMF-World Bank meetings, also said he understands the combination of problems facing Pakistan (in the midst of anti-terror fight), which have been compounded by recent floods.
“The problems are real but difficultie are an opportunity for building (the future shape of the economy).” The IMF official expressed support for assisting Pakistan with flood recovery and said the Fund will urge further world support for the country. In this respect, he said, the WB and ADB are carrying out a comprehensive damage and needs assessment, which will be very helpful going forward with recovery from the calamity.
He noted it will be helpful for the economy that Pakistan rationalize the prices of electricty without hurting the poor and said last year the country gave $ 2 in subsidies last year.However, he clarified the IMF is not dealing with the issue as it is the World Bank which deals with electricity issuesn – App