Journal Issue

IMF completes EFF review for Pakistan

International Monetary Fund. External Relations Dept.
Published Date:
January 1999
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Ouattara said that policy implementation had largely remained in line with program commitments since the last review was conducted in January 1999. “This has helped strengthen investor confidence, eased pressures in the foreign exchange market, and kept inflation under check. I welcome the recent unification of the exchange rate system. Despite these favorable developments, Pakistan’s macroeconomic situation remains difficult. Fiscal consolidation and the restructuring of the budget remain central to the success of the program. Resolute action is needed to broaden the tax base and further strengthen tax enforcement. The authorities also need to accelerate structural reforms to build a solid foundation for high economic growth in the medium term. Important steps have been taken in strengthening the prudential and regulatory framework of the banking system, and some progress has been made with power sector reform. I strongly encourage the authorities to resolve the outstanding issues with Independent Power Producers and complete the restructuring of the power sector without delay. Pakistan has also made important progress in normalizing relations with creditors. I encourage the authorities to move expeditiously in concluding bilateral arrangements with Paris Club creditors and to seek comparable treatment from all other bilateral, commercial, and private creditors. All these measures will help in restoring investor confidence in Pakistan. In that context, it is important for the authorities to focus on issues of good governance and transparency” he said.

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