Federation of Pakistan Chambers of Commerce and Industry (FPCCI) Thursday recommended Assets Declaration Scheme to encash windfall gains in cryptocurrencies.
The recommendation was made during the national consultative conference of chambers and associations on a national economic plan for the economic development of Pakistan.
The FPCCI recommended channelizing modern digital assets such as cryptocurrency into national assets, and the National Finance Commission (NFC) and Provincial Finance Commission (PFC) Awards be announced regularly.
The conference was held at the FPCCI office here on Thursday.
The conference recommended that the government should strictly avoid politically motivated expenditures such as untargeted subsidies and discriminatory tax concessions and unjustified appointments.
The public expenditure management shall be improved by introducing pension reforms, restructuring/privatizing SOEs, minimizing subsidies, etc. Responsible debt management shall be ensured by a higher weight on long-term debt instruments when inflation is less than 8 percent and vice versa.
The tax management shall be improved by simplifying the tax regime by reducing the number of taxes, broadening the tax base & reducing corporate tax gradually to 25 percent.
According to the presentation shared by the FPCCI during the national consultative conference, during the last 7-8 months Pakistan is facing its worst economic conditions. The foreign reserves are depleting continuously and have dropped to historic lows of approximately US$ 6 billion. The industries are standing on the edge of collapse. Exports are declining due to the shortage of raw materials.
Due to a shortage of input materials multinational companies are closing their production plants in Pakistan. The recent examples are two car companies that have shut down their plants causing unemployment in the country. On the other hand, Inflation is also out of control.
Due to the trust deficit Pakistani bonds are unable to attract the international markets. The remittance data shows a declining trend. Pakistan has been declared the second most expensive country in South Asia.
The credit rating agencies have also degraded Pakistan’s status from “Stable” to “Negative” which created further difficulties for Pakistan in order to get new loans.
As an apex trade body of Pakistan, the FPCCI strongly believes that all the affairs of our economy should be managed with consensus decisions with the recommendation of trade bodies as major stakeholders.
The conference obtained feedback on the formation of national agenda with a conscious to pave the way to develop a charter of the economy that will give stability to the economy and might as well give it a great boost.
The FPCCI stated that the governments have not been able to get the country out of the menace of years-old foreign borrowing due to their lack of any clearly defined strategy. The production of our agricultural and industrial sectors has also not been up to the mark due to various masons and questionable strategies adopted by successive governments.
After seventy years we are still confused about whether we should spend on education and health or defense, nationalized economy or a privatized economy, whether direct taxation or indirect taxation, an agricultural economy or industrial economy, should we go for foreign loans or self-reliance, spend more funds for human development or infrastructure development, should we focus on foreign direct investment or local investment.
These can only be sorted out when political and economic leadership sit together with good intent and sincerity for presenting the best economic model and strategy to the nation, to steer the country out of the present economic crisis.
Under the head of Public Finance Management and Monetary Policy, consistency in monetary policy shall be ensured by making Interest rate adjustments less frequent. An active and effective Competitive Commission of Pakistan (CCP). effective price control magistracy system and executive vigilance against hoardings and other price manipulation malpractices.
The effectiveness of policy rate adjustment as a tool for containing inflation shall be reviewed; to optimize interest rates as the debt burden increases due to higher interest rates and access to finance for the private business and SMEs.
For Foreign Exchange Management, the current volatile, speculative, and unpredictable exchange rate regime has made trade and investment decisions impossible. The government shall introduce managed float exchange rate regime while adopting a mechanism for the periodic valuation of local currency based on REER. Foreign exchange control measures shall be adopted to restrict the outflow of precious foreign exchange.
Under the National Food Security & Agriculture Sector Sustainability, there is a need for effective Implementation of the National Food Security Policy through effective coordination between provincial and federal authorities.
The essential Food Inventory Management should be done by digitally maintaining food inventory involvement of the domestic private sector developing sufficient storage facilities through active involvement of the private sector and timely interventions in the market.
This should be done by digital integration of the farming community through the use of smart applications which brings awareness about better farming practices. The Horticulture Sector will be supported to reach its full potential by access to finance for investment in farm-market infrastructure, processing & storage facilities, export marketing support by TDAP, and the developing digital platforms.
The implementation of the National Water Policy – at provincial levels shall be coordinated by the federal government to bring the country back to a safe water availability level, FPCCI added.