Pakistan Initiates Its Own Economic Reform Program: SBP Governor

Pakistan is working on its home-grown economic reform program with key measures, said Governor State Bank of Pakistan Reza Baqir in a meeting with a delegation of International Monetary Fund (IMF).

He observed that the transition to a market-based exchange rate system, building foreign exchange reserves, and bringing down inflation were key elements of SBP’s reform program to restore the financial stability and lay the foundations for sustainable and shared growth.

The initial results from the reform program are encouraging. The earlier volatility in the exchange market and associated uncertainty has subsided and confidence was slowly improving. Inflation had risen due to the economic imbalances accumulated from previous years but inflationary pressures are expected to recede in the second half of the current fiscal year, he added.

Nevertheless, the governor emphasized that these are the early stages of the reform process and it was essential to sustain the reform momentum and to keep policies focused on securing stability and promoting sustainable and shared growth.

He looked forward to continuing a fruitful partnership with the IMF and other stakeholders in the international financial community to support this reform program.

A delegation of the International Monetary Fund (IMF) led by the Director Middle East and Central Asia Department, Mr. Jihad Azour, called on the Governor State Bank of Pakistan Dr. Reza Baqir in Karachi.

He was accompanied by the IMF Mission Chief to Pakistan, Mr. Ernesto Ramirez Rigo; Resident Representative of IMF for Pakistan, Ms. Teresa Daban Sanchez; and Special Assistant to the Director of the IMF’s Communications Department, Olga Stankova. The delegation also met with senior management of the SBP.

In his discussions with the SBP, Mr. Azour shared his views on how the central banks in the region were responding to the challenges particularly with regard to capital flows, the role of technology, and the role of central banks in economic management, amongst other areas. Mr. Azour looked forward to a continuing partnership with the State Bank of Pakistan.