ISLAMABAD, Nov 5: The United States and Pakistan agreed on Tuesday to work together to encourage bilateral private sector investment, expand trade and pursue poverty alleviation efforts.

This was the gist of two-hour discussions between finance minister Shaukat Aziz and US undersecretary of state for economic, business and agricultural affairs Alan Larson here on Tuesday.

During the meeting, the US side also agreed to assist Pakistan in micro-financing and technology sector, particularly biogenetic technology and information technology and help improve management of customs service by using technology to improve tax collection and discourage smuggling.

Larson said the Joint Economic Forum, US-Pakistan Business Council and Joint Trade and Investment Forum had laid a very strong foundation for Pakistan-US economic relations. This was the time that two sides must reap the benefits of economic relations and develop a long-term partnership to encourage and promote trade and investment through private sector, he added.

The US official said commitment of the US government to strengthen its relationship with Pakistan was a long-term one and remain undiminished. As a result of the financial, structural and capital market reforms, Pakistan had done well in strengthening its economy, particularly when so many external shocks had been felt by economies all over the world.

Pakistan, because of its innate economic strength due to reforms and staying the course was able to face post-Sept 11 scenario with confidence and courage. Had Pakistan, he said, not introduced these reforms, it would have faced economic turbulence and its economic cost would have been enormous.

Larson said foundations of economic growth had enabled the country to reduce its budget deficit, increase gross foreign exchange reserves, was in a position to increase the GDP growth rate and had restored confidence of the international investors and financial institutions.

Informed sources said the US official conveyed his government’s desire for the continuation of trade and finance ministers even in the political set-up for consistent policies.

An official statement said he hoped for consistency and continuity of policies so that full benefits of economic reforms were realized by the people of Pakistan.

Larson said Pakistan had laid the foundation for higher GDP growth rate due to an approximate mix of policies. Trade expansion was key to growth and job creation and in this connection regional trade offered a lot of potential opportunities.

He assured Pakistan that debt cancellation of $1 billion would be made through the Congress in the next few months, and appreciated the hard work on anti-money laundering laws and the regulation to register the money exchange companies.

The US would also help Pakistan achieve the high growth rate targets to improve its ability to diversify spending on social sectors, specially on education and health, to address the issue of poverty in an holistic manner.

He said the US support for Pakistan’s economic reforms preceded Sept 11 and was based on quality and depth of economic policies pursued by the government.

The two sides also discussed possibilities of market access, specially textile sector, as it would generate jobs and trigger economic growth within the country.

AZIZ: Finance minister Aziz briefed Larson and his team on the process of privatization, development and growth strategy, financial reforms, economic performance, debt strategy, micro-financing and capital market reforms.