ISLAMABAD: Governor State Bank of Pakistan Reza Baqir has said that exports have recovered to their pre-COVID monthly level of around $2 billion, with the strongest recovery in textiles, rice, cement, chemicals, and pharmaceuticals. Pakistan needs to focus on competitiveness and reduce imports even further to support local businesses.
Addressing the plenary on “Pakistan’s Economic Response to COVID-19 and Way Forward for an Inclusive Economic Recovery” on the second day of the 23rd Annual Sustainable Development Conference of the Sustainable Development Policy Institute (SDPI) here Tuesday, the governor State Bank said to boost economic activity and job opportunities in the country, the State Bank of Pakistan was working with the banks to see that lending to Small and Medium Enterprises (SMEs) and housing financing facilities are increased in collaboration with banks. He said that under the Prime Minister's instructions, the government has coordinated a consistent and holistic policy to promote the housing and construction sector. At the central bank’s end, we are working with the banks to help them support this sector, he added.
The governor said: "India's economy has suffered sharp decline. Pakistan has not been hard hit because the country controlled COVID-19 well and the government and SBP took timely measures to stop bankruptcies from happening since that can lead to major and long-term implications. Now that demand is coming back from the world market, our exporters were ready due to the availability of liquidity and smart lockdowns. What we need to focus on now is to increase our export-to-GDP ratio." Dr Reza Baqir said the SBP would refinance banks to provide financing at a maximum end-user rate of 7% for 10 years for the purpose of new imported and locally manufactured plants and machinery for setting up new projects and expansion for existing projects/businesses.
As a country, we should be proud that the world is recognizing and acknowledging our success in tackling the COVID-19 pandemic. At the State Bank of Pakistan, we are cautiously optimistic and seeing early signs of a promising recovery. We should not be hostage to our past, Dr Baqir said: "The IMF, like the government, wants power sector reforms and reduction of circular debt; second that tax collection should be automated and cases of abuse reduced so that people are facilitated in dealing with tax authorities, in addition to increase the tax net. Both the IMF and the government want the same thing in this regard."
Earlier, speaking at a session on “Impact of COVID-19 on Food Security: Challenges for Women”, Ms Androulla Kaminara, European Union Ambassador to Pakistan, said that food is not insufficient in Pakistan, but it is inaccessible for the poor and vulnerable classes and communities. Rashid Mehmood, Additional Secretary for Ministry of National Food Security and Research, said that Pakistan needs to promote multi-sectoral approach to address food insecurity in the country.
Wouter Plomp, the Ambassador of the Netherlands in Islamabad, stressed the need to keep food markets operational so that food security can be improved and ensured. Dr Aamer Irshad from Food and Agriculture Organization termed the pandemic a global situation and explained that how the economy and production were reducing due to COVID-19. He highlighted that the bad weather, cost of production and imports are causing food inflation.
Dr Pauline Oosterhoff, Institute of Development Studies, discussed as to how the COVID-19 has increased the invisible burden for women as well as their unpaid responsibility. She said food is really necessary for every kind of development.
Speaking at a session on Future of BRI in the Post-COVID World, Lt-Gen. Asim Saleem Bajwa said small developing countries cannot afford packages what the developed countries have allocated for their people to handle the pandemic. In these dire circumstances, BRI is a beacon of hope and relief for the developing countries.
Xie Guoxian, the Chairman of ACEF, Beijing, said that China has changed the traditional concept of development. From and unconventional point of view, he said, China emerged as a powerful economic power and is also cooperating positively while recognizing all the difficulties of Pakistan. Xie Yuhong, Minister Counselor, Embassy of China in Islamabad, said that COVID-19 implies that all world should work together to overcome the challenges, including climate changes, etc. The goal of the omniverse is same for all countries and all people. Mudassir Tipu, Ministry of Foreign Affairs, said that CPEC has finally succeeded in entering into its second phase. Both Pakistan and China want to complete CPEC as soon as possible, he said.