Pakistan

Govt will have to save Pakistan from default for next two years: Miftah Ismail

  • Former finance minister says Pakistan will need to enter another IMF programme
Published April 29, 2023

Former finance minister Miftah Ismail said on Saturday that for the next two years, the Pakistan government will have to work “to save the country from default and will have to enter another International Monetary Fund (IMF) programme.”

Speaking at an event, he said economic problems of the country cannot be solved unless radical reforms are introduced including the restructuring of budget.

Pakistan’s ex finance chief Miftah warns against any kind of debt restructuring

“Under the current tax structure, Pakistan cannot escape crisis,” he stressed. “The country will keep on recording deficits and it cannot escape the crisis until it eliminates the long-term unsustainable deficits.”

According to him, there was a dire need to raise the tax-to-GDP and export-to-GDP ratios to a substantial margin of 15% to see a positive change.

Pakistan has to repay $25 billion in debt every year to foreign countries and institutions for the next several years, he lamented.

“We spent on the public of the country but we have nothing to show for it,” the former finance minister said. “The population is rising at an unsustainable pace for the past 20 years and wake-up calls were given but it turned out to be pointless.”

However, Bangladesh succeeded in controlling its population, he said.

‘Pakistan not a destination of choice for investment’

According to him, Pakistan had low exports because foreigners were discouraged from visiting it.

Miftah calls for economic ‘overhaul’

“More foreign airlines land at Dhaka airport than Lahore, Islamabad and Karachi combined,” he underlined. “Terrorism played a negative role here.”

The buyers of our products prefer to call local businessmen to Dubai and Bangkok for inking deals, he said, stating that “not a single dollar in foreign direct investment (FDI) comes to Pakistan for export-oriented purpose.”

“Vietnam gets FDI for export. Samsung’s export from Vietnam is $68 million per year,” he said. “Pakistan and Vietnam used to have same value of exports in 1992 but now, Vietnam exports $300 billion worth of commodities and services.”

Pakistan is not a destination of choice for investment for any country, he regretted.

FDI – any glimmer of hope?

“International firms prefer to enter the markets of Vietnam, Cambodia and Bangladesh but not Pakistan,” he said.

The past five governments worked to reduce the circular debt but it is still ballooning, he said.

Moving on to airlines, he stated that PIA had been in loss for past 20 years “yet the government keeps on bailing it out and compromising public spending”.

PIA posts Rs60m profit in Q1CY23, NA told

The former finance minister also stated that the education sector of the country is also in shambles and “a large amount of children are stunted or wasted”.

He pointed out that hunger and malnutrition was causing stunting in Pakistan’s population.

“Our infant mortality is as worse as South Sudan,” he said.

Comments

Comments are closed.

Mian Nawaz Sharif-Shit Apr 29, 2023 04:10pm
Man speaks truth. He is probably hated by PDM etc.
thumb_up Recommended (0)
Parvez Apr 29, 2023 05:20pm
Borrowing without ensuring the ability to pay back ...... this policy practiced over decades was premeditated and deliberate.
thumb_up Recommended (0)
Tulukan Mairandi Apr 29, 2023 05:52pm
After those 2 years, Pakistan will cease to exist. He knows it too. It will be a loose alliance of new countries.
thumb_up Recommended (0)
Nadeem Apr 29, 2023 09:51pm
@Tulukan Mairandi, if there is competition of baseless assumptions you will be the winner everytime
thumb_up Recommended (0)
Rizwan Apr 30, 2023 12:58am
The man speaks the truth. But he says the same things every time and it is getting boring.
thumb_up Recommended (0)
Maqbool Apr 30, 2023 10:57am
Miftah is hated by all the other major parties and the Elite for saying things as is. Sadly I don’t see any political party being able to do the job, specially if you examine their all their past proformance. They’ve all been a disaster for our country .
thumb_up Recommended (0)