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External woes ‘manageable’ but govt must move fast: Citi

Updated October 03, 2018

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— Photo/File
— Photo/File

DUBAI: Pakistan’s external woes are manageable given the simplicity of the problems, says Citi’s CEO, Middle East and Africa, Atiq Rahman.

The country is unlikely to face a crisis-like situation in the foreign exchange management and reserves cover since the issues are simple to manage, he said. Political change is positive for the country, he said pointing to the government transition, and the extension of democratic process is also a welcome sign for the country’s stability in the long run.

He said that Pakistan must take appropriate measures to address its problems mentioning the need to substitute imports, while reiterating the need for a long-term horizon and not look for “miracles” to solve problems.

He was speaking at a community summit organised by Citi in Dubai for its Middle East and North Africa operations. The event included briefings from the region’s country officers, trade and treasury representatives and fin-tech experts who shared details on the progress in Citi’s operations in their respective countries.

The company’s Chief Country Officer for Pakistan briefed the gathering on the Belt and Road Initiative and informed the panel on strategic significance of the project and its potential to improve the country’s ability to circumvent its energy bottlenecks.

The panel, while discussing Pakistan, took notice of the the country’s rising foreign exchange requirements and said that Pakistan must quickly decide on whether it wants to approach the International Monetary Fund or go for a bilateral China, Gulf Cooperation Council-borrowing. However, he said that it seems highly unlikely that any single party would be willing to lend the entire amount other than the IMF.

He said that China is also investing in agriculture in Pakistan, thereby pushing the potential for increase in exports in the sector. He said that “the country wastes around 50 per cent of its agricultural output and with the Chinese investments in the sector, exports can be increased significantly.”

He added that the government needs to work on import substitution by promoting in-house production as well as using local goods and facilities at the special economic zones built under the CPEC.

Published in Dawn, October 3rd , 2018