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Govt categorically denies rumours on imposing economic emergency

Finance Division says no planning to impose economic emergency; clarifies message is unfortunately aimed at creating uncertainty

By Business Desk
December 06, 2022
— AFP/File
— AFP/File

The Finance Division Tuesday categorically denied assertions on supposed economic emergency proposals being circulating on social media, terming them “false”.

In a statement issued today, the Finance Division not only strongly rebutted the assertions made in the said message but also categorically denied it. It stated that there is no planning to impose an economic emergency.

“The message is unfortunately aimed at creating uncertainty about the economic situation in the country and can only be spread by those who do not want to see Pakistan prosper,” the statement read.

It further mentioned that the creation and spread of such false messages are against the national interest in these times of economic hardship. 

“A mere reading of the nine points mentioned in the message indicates how far-fetched those suggestions are,” the division said, adding that it was quite inappropriate to equate Pakistan with Sri Lanka, given the inherent strength and diversity in Pakistan’s economy.

“The present difficult economic situation is mainly the result of exogenous factors like commodity super-cycle, Russia-Ukraine war, global recession, trade headwinds, Fed’s increase in policy rates and devastation wreaked by unprecedented floods,” the statement said.

The ministry also stated that the government has been making utmost efforts to minimise the impact of such external factors, even when faced with the economic consequences of unprecedented floods and having to meet International Monetary Fund (IMF) conditionalities.

In this challenging economic situation, the government has put in place a number of austerity measures with the approval of the federal cabinet.

“Such measures are in public knowledge and are aimed at eliminating non-essential expenditures,” it added.

Meanwhile, it mentioned that the government has been deliberating energy conservation mainly aimed at reducing the import bill.

Such deliberations will continue in the cabinet and all decisions will be taken in consultation with all stakeholders and in the best national interest.

It should be noted that a downward trend has been witnessed in the import bill since the beginning of the current fiscal year as imports fell by 10.4% in July, 7.7% in August, 19.7% in September, 27.2% in October and 33.6% in November over their respective corresponding months of 2021.

Addressing speculation regarding talks between Pakistan and the IMF at a stalemate, the Finance Division said that the government remains committed to completing the programme while meeting all external debt repayments on time.

“With the efforts of the current government, the IMF programme has come back on track and negotiations leading to the ninth review are now at an advanced stage,” it said.

However, earlier, the IMF resident chief said discussions with the Pakistani “authorities are ongoing, especially as not all end-September quantitative targets have been met”.

Shedding light on other economic indicators, the Finance Division said: “The government’s recent efforts have resulted, amongst others, in lower current account deficits in recent months and achievement of the Federal Board of Revenue (FBR) targets.

As of December 1, the FBR exceeded both the five-month target of Rs2,680 billion as well as the monthly target of Rs537 billion despite import compression and zero rating on petroleum products.

“Easing up of pressure on the external account is also foreseen in the near future. While there remains the need to make structural adjustments in the mid-term, the economic situation of the country is now moving towards stability,” it stated.

Moreover, the Finance Division urged the people of Pakistan to contribute towards economic betterment and stability and not to pay heed to “malicious” rumours mongering which is against the national interest of Pakistan.