PBF warns next 12 months are going to be hard for Pakistan’s economy
LAHORE ( Web News )
Pakistan Businesses Forum (PBF) have demanded to fix the dollar rate for six months and State Bank of Pakistan (SBP) could step in and offer to swap the dollar funds into rupees cheaply for the borrowing banks, for this SBP could raised substantial funds to 5 billion dollars, as country reserves is depleting about six weeks’ worth of imports only.
PBF Senior Vice President, Muhammad Riaz Khattak said rupee is depreciated on a daily basis with an iron speed, NEPRA on almost every hearing revised the electricity tariffs, we failed to understand how business community and people of this country can sustain in these extraordinary days.
He rejected the finance ministry notion that political unrest could hurt the country’s financial stability through exchange rate depreciation and less investment. We need your out of box solutions, regardless maintaining market confidence will be crucial.
Khattak proposed a non-political, inclusive, sustainable and legally-binding Charter of Economy to forge an across the board contract and unflinching commitment towards economic growth, development and equality. He said that the aforementioned charter should encompass all sectors of the economy and all segments of the society. Let’s work together for a prosperous, egalitarian and industrialized Pakistan, he added.
PBF Vice President, Ahmad Jawad said we were very positive that the incumbent Prime Minister could bring a noticeable change in the governance, administration and delivery on the back of his proven track-record to successfully implement reforms but in his three and half months tenure economy of the country may further bleak.
The current account deficit (CAD) swelled to $17.4 billion in FY22, which could be the most painful shock for an economy already in trouble with serious imbalances. We have external financing needs of about $34 billion in the next 12 months to pay off debts.
The Finance Minister Miftah Ismail should start an objective & inclusive consultative process with the stakeholders in the business community and take them into confidence on how the government will be able to manage the CAD also strengthen rupee factor.
PBF VP noted that food inflation has crushed the masses on the back of international fuel & commodities prices and supply-side mismanagement. The government must swing into action with the assistance of private-sector to ensure food security.
Ahmad Jawad further condemning the policy rate hike, said that raising the policy rate to 15% can very well be proven as the last nail in the coffin of SMEs; which are already under dire strains due to the burgeoning cost of doing business; abysmal ease of doing business indicators; difficulties in access to finance; uncertainties in access to foreign exchange and regionally- uncompetitive costs of electricity & gas.
He also viewed country may be able to avoid a full-blown economic crisis but only if everything goes right. And time may not be on Pakistan’s side. As the troubles of the emerging world grow, markets are showing signs of becoming less discriminating, not more. Time to announce economic emergency in the country to save national security.