Global Village Space
Published Date: Dec 4, 2018
Finance Minister Asad Umer on Tuesday claimed that the Tehreek e Insaf government has successfully overcome the economic crisis with the help of friendly countries as the current account deficit is being filled, local publications reported.
The finance minister made these statements as he was inaugurating the 11th South Asia Economic Summit organized by Sustainable Development Policy Institute (SDPI) in Islamabad.
“We are facing a foreign exchange crisis. Our [macroeconomic] indicators are now headed in the right direction; we will not face the issue in the future.”
He added that the “financing gap for the current fiscal year has been plugged” and the ‘fruits of the Pakistan Tehreek-e-Insaf (PTI) government’s vibrant economic policies’ will soon be visible, local publications quoted.
“All the fundamental economic indicators are now improving with exports witnessing an upward trend while the imports are decreasing and the current account deficit is also being overcome gradually,” the Finance Minister added.
In light of the Prime Minister’s earlier comment that the State Bank of Pakistan (SBP) depreciated the value of rupee without running it by the government, he clarified that the central bank will remain an autonomous body but will be “further institutionalized”.
Read more: Pakistan’s Economic Overhaul – Maleeha Hashmey
Referring to media’s interpretation of PM Khan’s televised meeting with TV anchors on the evening of 3rd December, the finance minister warned against “spreading rumors about the national economy” and added that it would not do any good to the country.
PM Khan, in the interview with TV Talkshow personalities, had stated that the devaluation of rupees is solely based on the actions of the State Bank, GVS earlier reported. The decision of intruding new exchange rates under the influence of prevailing temporary inflation rates was a major factor in the fluctuation in the Dollar to Rupee rate in recent days.
Government is considering/targeting that legislation and legal cum political culture which can favor these businesses community.
“Please remember, we are trying to autonomous institutions,” he said. “We have made SBP autonomous; they took the decision because they deem it fit.” Prime Minister Imran Khan commented that 19 billion trade deficits were the output of flawed policies of the previous government which we are facing now. “The PML-N government had spent $7 billion to [artificially] maintain the value of the rupee,” he said.
Last week, rupee had dropped to its lowest value ever against the US dollar at Rs144 before the State Bank intervened to raise its level to Rs136.5-137.5.
To counter the economic menace, Imran Khan assured the anchors that they have directed the State Bank to conclude their policies while taking government and civil societies under consideration. Similarly, the rupee devaluation has direct relations with policies implementation in Markets versus investments “The [rupee] adjustment is a temporary phenomenon,” he assured. “We are facing a foreign exchange crisis. Our [macroeconomic] indicators are now headed in the right direction; we will not face the issue in the future.”
The Prime Minister showed optimism about the upcoming investment and Small & Medium Enterprises which are the core elements of wealth generation. Since there is a direct relationship between money creation and the medium/environment provided to them to operate within. Government is considering/targeting that legislation and legal cum political culture which can favor these businesses community.