In meeting with finmin, WB chief assures full support for reforms to stabilise economy

Published April 17, 2024
Finance Minister Muhammad Aurangzeb with World Bank President Ajay Banga. — Photo courtesy Ministry of Finance/X
Finance Minister Muhammad Aurangzeb with World Bank President Ajay Banga. — Photo courtesy Ministry of Finance/X

Finance Minister Muhammad Aurangzeb has held meetings with the presidents of the World Bank (WB) and the Asian Development Bank (ADB), in which the former assured his full support for reforms to stabilise the economy and enhance revenues.

The minister is currently in Washington to attend the spring meetings organised by the International Monetary Fund (IMF) and the WB.

In a post on X early Wednesday morning, the finance ministry said Aurangzeb met ADB President Masatsugu Asakawa.

“Discussions focused on further strengthening Pakistan’s partnership with ADB, protecting country envelope of concessional financing and future project pipeline,” it said.

A subsequent post said that the finance minister also met WB President Ajay Banga and highlighted Pakistan’s progress under the nine-month standby arrangement programme and ongoing reforms in priority areas of taxation, energy and privatisation.

“Both sides agreed on the need for a rolling country Framework Plan for 10 years. The WB president assured his full support for Pakistan’s reforms and digitalisation programmes to stabilise the economy and enhance revenues,” the ministry said, adding that Aurangzeb also invited the official to visit Pakistan.

The meetings come as Pakistan has initiated discussions with the IMF over a new multi-billion dollar loan agreement to support its economic reform programme. According to the finance minister, Pakistan will at least be requesting for a three-year programme.

The country is nearing the end of a nine-month, $3 billion loan programme with the Fund designed to tackle a balance-of-payments crisis which brought it to the brink of default last summer.

With the final $1.1bn tranche of that deal likely to be approved later this month, Pakistan has begun negotiations for a new multi-year IMF loan programme worth “billions” of dollars, Aurangzeb said during an interview in Washington.

Impact of geo-economic fragmentation on Pakistan

Later, the finance minister highlighted geo-economic fragmentation and its impact on Pakistan while attending the Middle East and North Africa (MENAP) Ministers and Governors meeting with the managing director of the International Monetary Fund (IMF).

A statement from the finance ministry said Aurangzeb thanked the IMF, multilateral development banks and Pakistan’s “time-tested sincere bilateral partners” for their support in helping the country respond to unprecedented challenges.

He further underscored aggressive reforms, including broadening the tax net, privatising loss-making state-owned enterprises, expanding the social safety net and facilitating the private sector.

Aurangzeb also underlined the importance of re-channelling special drawing rights, reviewing the surcharges policy and prioritising the Resilience and Sustainability Trust given climate vulnerabilities.

The finance minister called for a more proactive and responsive global financial safety net to tackle the elevated risks.

He welcomed the renewed emphasis of the IMF on capacity building through regional capacity development centres.

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