Foreign remittances, FDI look up

ISLAMABAD: Advisor to the Prime Minister on Finance Dr Abdul Hafeez Shaikh Wednesday said despite COVID-19, Pakistan had registered an upward trend in foreign remittances and FDI, testifying to confidence in Pakistan’s economy.

He said this in his virtual address to the second segment of the plenary session of the World Economic Forum (WEF) on Country Strategy Dialogue (CSD).

Briefing the forum, Shaikh said the government inherited a very precarious economic situation in 2018 and had to introduce a strict financial discipline to curtail excessive government expenditure, increase revenue collection, introduce market-driven exchange rate, remove large tax exemptions and discourage imports.

“As a consequence, Pakistan witnessed remarkable improvement in fiscal and current account deficits. Similarly, Pakistan had a primary balance surplus, which is unprecedented. All fundamental economic indicators reflected significant improvement before COVID-19,” he continued.

During the COVID-19, the government introduced smart lockdown to contain the spread of the disease with the need to keep the economy functional, he said, adding that the smart lockdown allowed many businesses to re-open or continue operations on limited scale to lessen the adverse economic impact and support the vulnerable segment of the society. To provide relief to vulnerable groups, especially daily wage earners, the government gave cash payments to 15 million families under the Ehsaas Emergency Cash Program, he added.

Shaikh outlined that amid COVID-19, the government took several initiatives to facilitate agriculture and construction sectors to accelerate economic recovery.

“A relief package for the Small Medium Enterprises (SMEs) shielded against insolvency and joblessness. The recent data complements the strengthening and expansion of economy in the ’recovery’ mode. Despite COVID-19, Pakistan has registered an upward trend in foreign remittances and FDI, which is a clear reflection of confidence in Pakistan’s economy,” he said.

He reiterated that the government firmly supported the private sector as an engine of growth and believed in building institutional capacity for sustainable and inclusive economic growth. “We followed a liberal foreign investment regime and introduced measures to promote ease of doing business in the country”, he stated. He said the current leadership welcomed foreign investors and believed in transparency, accountability and openness.

Our agenda is to empower people with key focus on human resource development, the adviser concluded.