IMF Chief, Kristalina Georgieva, has requested Pakistan to ‘increase taxation on the wealthy and safeguard the welfare of the poor.’ She emphasized that these measures align with the desires of the Pakistani people.
IMF Chief, Georgieva made these remarks on the sidelines of the 78th United Nations General Assembly (UNGA) session in New York.
Following a meeting with Pakistan’s caretaker Prime Minister Anwaar-ul-Haq Kakar, Georgieva also shared her thoughts on a social media platform, formerly known as Twitter.
She mentioned their discussion on Pakistan’s economic prospects and the shared recognition of the need for robust policies to ensure economic stability, sustainable and inclusive growth, prioritized revenue collection, and protection of vulnerable populations in Pakistan.
Had a constructive dialogue with Ms. Kristalina Georgieva, Managing Director of the IMF, at the #UNGA78, that emphasized extending our mutual commitment towards bolstering economic stability and growth in Pakistan. pic.twitter.com/u8kJX8Eqga
— Anwaar ul Haq Kakar (@anwaar_kakar) September 20, 2023
In response, the Prime Minister’s Office (PMO) released a statement expressing gratitude for the IMF’s approval of a $3 billion Stand-By Agreement (SBA) to support Pakistan’s economy. This agreement, approved by the IMF’s Executive Board in July, will undergo its second review in November.
The statement further elaborated that Prime Minister Kakar outlined various measures taken by the Pakistani government to stabilize and rejuvenate the nation’s economy. These measures aim to create a stable environment conducive to sustainable economic growth and investment while placing a strong emphasis on protecting vulnerable segments of society.
Georgieva acknowledged Pakistan’s concerted efforts in implementing policies and reforms to revitalize the economy and assured continued engagement with Pakistan on behalf of the IMF.
In July, Pakistan entered into a last-minute SBA with the IMF, which facilitated inflows from multilateral and bilateral partners such as Saudi Arabia, UAE, and the World Bank. This agreement helped alleviate the pressure on Pakistan’s dwindling foreign exchange reserves and offered some respite to the country’s long-standing economic challenges.
Pakistan’s economy has grappled with a recurring cycle of economic booms and busts, compounded by runaway inflation and a balance-of-payments crisis. These issues prompted the Asian Development Bank (ADB) to downwardly revise its growth projections for the fiscal year. Low foreign exchange reserves led to import restrictions, given the high debt payments and limited sources of dollar inflows.
Prime Minister Kakar also used the opportunity to call on the international community to find lasting solutions to the debt problems faced by 59 countries in debt distress. He emphasized that global and regional cooperation is essential for the proper implementation of the development agenda, expressing support for the UN secretary-general’s endorsement to address liquidity challenges faced by countries.
He reiterated Pakistan’s commitment to fully support the Global Development Initiative and acknowledged the importance of initiatives like China’s Belt and Road Initiative (BRI) and the China-Pakistan Economic Corridor (CPEC) in achieving sustainable development goals.