In an exclusive interview, Prime Minister Shahid Khaqan Abbasi said that letting the rupee get devalued is not an option – Pakistan will not seek financial support from International Monetary Fund anymore.
Pakistan’s foreign exchange reserves are in a pinch because of a currency crisis and declining exports. The reserves are decreasing more quickly than the government expects, financial analysts believe.
PM Abbasi in his interview said,
We have discussed devaluation but it’s not on the cards. There has been a slight decline in the rupee but that’s market-based. In fact, because we are linked to the dollar and the dollar is weaker today, there has been a certain devaluation … compared to the other currencies.
Economies have also slowed down in the Gulf, where most of our remittances used to come from.
There has been a decline in the reserves but hopefully, the last two months show an improving trend and the numbers for September will come in… and we expect to resolve that issue within our resources and not have to resort to the IMF. I don’t think the IMF program is something that we intend to pursue.
Regarding the decreasing exports, the PM said that this was purely a macroeconomic pattern and will be handled in the future. He said,
Globally there has been a decline in exports. We are trying to revive them. The economy is expanding, so the current account challenge is there and we are managing it.
Imports have gone up. We have a lot of machinery imports. There are some discretionary imports that have gone up, which actually signals growth in the economy because the people have more money to spend on luxury goods.
PM convinced that the economy is currently in its expansion phase and it is expected to be much remunerative in the near future – thanks to the Chinese Investment in the CPEC project. He said,
If you look at any economy, the basic ingredient is more infrastructure to resolve infrastructural issues and this is a quantum leap in that direction.
It’s a massive investment, over $60 billion today. It’s mostly in infrastructure that we badly needed. Our roads, ports, industrial zones … it will open up western channels access to the world. It will help us to move our commerce faster. It will help us develop more industries and help with exports.
It’s really a game changer and it will have a multiplier effect. It will attract more investment, it will attract more projects. So, it’s really something that we feel will pay very high dividends for Pakistan.
Via ArabNews