Global debt market to be tapped for borrowings: GDP to increase 6.6pc: Aziz
By Khaleeq Kiani
ISLAMABAD, Dec 2: Pakistan is entering an era of market-based fund raising and financial management and the country will now rely more on borrowings from the international debt market, says Prime Minister Shaukat Aziz.
"Pakistan is very pleased today that the IMF board of directors has agreed to our request for exiting the IMF programme prematurely," the prime minister said while talking to a group of journalists here at the Prime Minister House.
Mr Aziz said that the continuous strength of economy and fiscal discipline would put the country on the path of economic management to realize its full potential. He also said the government was set to start "massive implementation" of the development activities that remained its major challenge before and hoped the country's real GDP to exceed a 6.6 per cent target for the current fiscal year.
The IMF has also agreed to Pakistan's request to jump straight to the Article-IV consultations instead of the post-programme monitoring mode (PPM). The PPM mode envisaged biannual reviews by the IMF of the country's economic performance and a binding implementation of the IMF's directives even after the completion of the programme, a senior official explained.
"There was no benefit in exiting the fund's programme and still complying with its conditionalities under the PPM mode. The government, he said, had succeeded in convincing "the IMF board that we do not need PPM." The official said the US, the UK, Japan, China and India were IMF's Article-IV partners and Pakistan had now made it to the list.
THE PRIME MINISTER SAID: "Today is defining moment for Pakistan's economy and its economic managers as we are now entering a more market-based fund raising and economic management. Pakistan will be even more active player in the international capital market."
Asked whether it meant the economic managers would feel relaxed after graduating from the IMF programme, the prime minister said the government would remain as disciplined and reform-oriented because there was even more responsibility now, adding that it would be a new lifestyle altogether.
An official said the prime minister had specially directed authorities concerned for reviewing proper implementation of development projects. He said that the government would launch Islamic bond "Sukkuk" within three months besides more Eurobonds and other bonds for development projects, particularly water sector bonds.
He said a number of other innovative financing techniques were being contemplated for project financing. He said the government wanted to provide the basic needs of life and amenities, like clean drinking water, job opportunities, and education and heath facilities to the masses. He said that Standard and Poor's had raised Pakistan's credit rating to B+ because of the government's transparent and prudent fiscal policies and reforms.
