KARACHI, Jan 27: Federal finance minister Shaukat Aziz has said Pakistan has managed to revive the confidence of the international financial institutions and now the immediate priorities of the country are to meet the challenges of poverty, good governance and institutions’ rebuilding to move ahead for a sustainable growth.

Mr Aziz was speaking at a function held here on Sunday where he was presented the most prestigious international award, the Best Finance Minister of the Year 2001.

The award was instituted 20 years back by the premier magazine of international finance, Euromoney, London, and is presented each year to the individual who has managed to perform the tough tasks in the most difficult of circumstances.

The minister said his selection as finance minister of the year was though an encouragement for all Pakistanis, but it was not the end of the story as they have yet to face even bigger challenges.

He said Pakistanis should borne in mind that they have plenty of problems and so are the opportunities. What they needed, he said, were clear direction and dedication. The minister recalled the daunting tasks he had to face in introducing the reforms agenda instead of going for status quo management which was easy to maintain. But the present government, he said, opted for the tougher path of reforms for which the support of the leader of the team, Pervaiz Musharraf, was very important.

“There were some surprises as well as disappointments but conviction, determination and will to succeed kept us going and the first real breakthrough came when we convinced the IMF to negotiate for the standby arrangements despite political issues of the military government.” During the negotiations it was a general comment that “these are the things we have been listening from you people.”

Pakistan moved from the standby facility to a long-term programme and as soon as the negotiations were completed, the world scenario changed on Sept 11, he added.

He said the reforms agenda started two years earlier helped Pakistan sustain the post-September 11 events as the country was at a comfortable level in regard to its reserves. “There is a difference now because there is a light at the end of the tunnel,” the minister added.

Mr Shaukat Aziz praised President Pervez Musharraf for his continued support which, he said, made it possible to pursue such an elaborated reforms agenda. He appreciated the officials at the ministry of finance and the allied departments working not less than 12 hours-a-day to achieve the objectives.

“It was a surprise to find such type of devoted people in the public sector who are equally smart and active. They lack skills but that’s because they were neither trained nor exposed to the changing trends in the world.”

He said the national institutions had been ruined in the past, which needed re-building and the government was trying to institutionalise the reforms so that they could last.

“The time has gone when a country could have put in more controls and isolate from the rest of the world, now you have to be nimble and blend the local, regional and international factors to have sustainable and right solutions”, the minister said.

He reiterated that the decision of the President to side with the international coalition in the war against terrorism was not meant for monetary benefits.

Earlier, Editor of the “Euromoney” Peter Lee referred to his remarkable career from Citibank to the present assignment of finance minister of Pakistan where he took over when the economy was near the brink of collapse.

Debt had built to an almost intolerable 37 billion US dollars. Trade and fiscal deficits were entrenched. The governments had struggled to increase tax revenue and had borrowed instead. The people had become impoverished and following the nuclear tests in 1998, there was a total breakdown in bilateral and multilateral relationships with various agencies, he said.

Mr Shaukat Aziz succeeded in reassuring the foreign creditors that Pakistan would not walk away from its obligations. Through reforms of liberalising the foreign exchange flows, reducing the fiscal deficit, removing trade barriers and addressing the underlying structural causes that had brought Pakistan to such straights, the country’s reserves have crossed five billion US dollars, almost two-and-half times higher than those when the government came into office, he added.

The government managed to slash the fiscal deficit by more than 1 per cent of GDP for the fiscal year ending on June 30, 2001. It has also kept the current account deficit below 2 per cent of the GDP and tax collection had been radically improved with tax receipts growing at a double-digit rate. Growth although damaged by severe drought, has picked up.

Mr Lee said Pakistan’s relations with the IMF and other bilateral creditors were now very good. In quick succession last month, Pakistan secured a key poverty reduction and growth facility with the IMF and a comprehensive restructuring of its Paris Club debts to sovereign creditors, he recalled and pointed out that without clear evidence of a sound record in macroeconomic management and timely introduction of structural reforms over the last two years, neither the IMF nor the Paris Club would have taken these steps.