ISLAMABAD, Aug 20: The IMF on Tuesday asked the government to ensure continuity of reforms beyond October, and undertake a thorough accountability in the state enterprizes to reduce Pakistan’s huge financial losses.

“The reforms process initiated by the government must continue after October elections as the efficient running of the economy should not be kept hostage to politics,” said Mr Paul Chabrier, Advisor to the IMF Managing Director.

“If Pakistan does not stay on course, the fruits of reforms so far achieved will evaporate,” he warned.

He pointed out that there were no differences between the government and major political parties on the question of how to run the economy.

He hoped that whoever came to power would benefit from the experiences of the last few years.

Speaking at a joint news conference along with Finance Minister, Shaukat Aziz, and the visiting head of the IMF review mission, Klaus Enders, he said the continuity of reforms was of critical importance for achieving a turn-round in the economy.

“The present government has started a very strong reforms programme and whosoever comes to power in the wake of October elections, should continue implementing these reforms,” he added.

“It would be bad politics if fundamentals were changed by the future government,” he said, praising the government for improving the foreign exchange reserves, reducing inflation to 3 per cent and increasing exports and foreign remittances. He said except for the revenues, there was a marked improvement in other economic indicators.

However, in reply to a question, the head of the mission Klaus Enders said that Pakistan’s social delivery system was still very weak and needed to be improved for reducing the social gap among various segments of society.

“Then, greater efficiency is required to reduce the losses of the public sector enterprizes and this cannot be done without undertaking strong accountability in these organizations,” Enders observed.

Mr Paul Chabrier in his opening remarks said that the government needed to achieve good growth rate, roughly about 5 per cent of the GDP. At the same time, he said, efforts should be made to reduce the country’s debt. “Your debt is manageable,” he remarked.

Nevertheless, since there existed a dangerous environment in the region, it was difficult to attract foreign investment, he said. He said he was glad to see that Pakistan’s per capita income was increasing and a certain stabilised exchange system was in place and working satisfactorily.

Mr Paul rejected the notion that the US, the West and the Paris Club had bailed out Pakistan for various political considerations. “The Paris Club offered rescheduling of loans because the performance of Pakistan’s economy was good,” he said. He also did not believe that Pakistan would have collapsed 18 months ago had there been no foreign support to the present government.

“In fact Pakistan has regained substantial amount of credibility,” he said.

Mr Klaus Enders said that barring that of revenues, all targets were on track and that his mission had a successful review of the Pakistani economy with officials concerned.

He said fiscal deficit had narrowed considerably and hoped that the drought conditions will end this year, allowing the economy to show better performance.

Mr Enders stressed the need for carrying out accountability process, especially in Wapda and the KESC to improve the country’s growth prospects and ensure debt sustainability.

Finance Minister Shaukat Aziz told a reporter that there was no delay in the privatization programme and that a number of entities, including PTCL, KESC, PSO, Habib Bank and United Bank, were ready for sale. Both the banks, he said, will be disinvested before October this year.

He also told a reporter that Pakistan would not be requiring any other IMF programme once the ongoing PRGF ended after two years. Aziz also said that the Fund’s Executive Board was likely to meet in October to offer the fourth tranche of about $120 million out of the $1.3 billion PRGF.

Earlier, in his opening remarks, he said Pakistan was on course to meet various requirements agreed with the IMF. He said there was 20 per cent increase in revenues during the month of July. Similarly, there has been 18 per cent rise in exports and 17 per cent in imports. He said remittances worth $307 million ware received in July and, “if this trend persists, we will be able to get substantial remittances at the end of the current financial year.” Reserves, he said, had reached over $7.2 billion and were likely to cross the $8 billion mark over the next few months.

“During talks with the IMF, the net conclusion is that we have done fairly good but still lot more is to be done, especially to ensure continuity of policies after October this year,” Aziz said.