Economic challenges exist but situation not as bleak as being portrayed: Bilal Azhar

ISLAMABAD: Coordinator to the Prime Minister on Economy and Energy Bilal Azhar Kayani on Saturday said the incumbent government had successfully averted the looming default and made significant progress towards stabilizing and rebuilding the national economy on a sustainable basis.

Responding to a tweet of Atif Mian titled, “Pakistan’s economy is in a tailspin, going from crisis to catastrophe”, Bilal said although Pakistan faced serious economic challenges the situation was not as bleak as portrayed in this thread.

He said that the current government has averted default and made significant progress toward stabilizing and rebuilding the economy.

Govt has taken ‘tough’ decisions ‘to save state’: PM

“There is a primary surplus of 0.9% of GDP this year as compared to a primary deficit of 0.6% during last year,” he said adding that the current economic difficulties, including inflation, have been directly caused by the disastrous decisions of the Imran Khan government which destroyed Pakistan’s economy in four years and deliberately pushed the country towards default before leaving the government last year.

“Imran Khan’s government not only almost doubled Pakistan’s debt but also caused a current account deficit of $17.4 billion in the fiscal year 2022,” he said adding that this figure would have been even higher if the current government had not taken mitigating measures after assuming office in April 2022.

Bilal Azhar said that the previous government’s actions eroded trust in the International Monetary Fund (IMF). “The Imran Khan government not only broke its promises with IMF to stall the IMF program and push the country towards default, but it also actively tried to sabotage the current government’s efforts to revive the IMF program.”

He said that the incumbent government, under the dynamic leadership of PM Shehbaz Sharif, was taking all necessary measures for the 9th Review to pull Pakistan out of the current economic crisis, adding that the technical level agreement with the IMF had been reached and the Staff Level Agreement had been held up because of lack of assured financing of $3 billion.

“Pakistan’s friendly countries are now moving ahead in this regard,” he said adding that the situation will start to move towards normalcy as soon as the agreement with IMF is reached.

He said the curbs on imports were not ideal but necessary at this stage to avoid the larger issue of defaulting on our foreign obligations.

Bilal Azhar Kayani said that these curbs were only temporary and would be removed once our foreign exchange reserves situation strengthens.

The GDP growth slowdown was not only specific to Pakistan but a global phenomenon, he added. The Russia-Ukraine war and increased interest rates by US Federal Reserve continued weighing on economic activity globally, he remarked.

He said Pakistan’s economy had also suffered the effects of the tragic floods last year, adding once Pakistan’s immediate external account challenges were addressed and the global outlook improved, Pakistan would also experience a GDP growth recovery.