Daily Times

Widening trade gaps, declining foreign exchange reserves and debt servicing pressures are indicating towards a financial crisis. Economists & analysts are buzzing the alarm every day. Unfortunately, the finance minister being on a leave has led to disconnect between financial policy makers and the public. Investors are heavily relying on unofficial sources of data while making decisions. This is hampering overall investment climate and is evident from declining Pakistan Stock Exchange index, despite healthy financial results of most companies.

In order to achieve political milestones, opposition at large are criticising the government without considering the impact of such criticism on investor’s and other stakeholder’s confidence. Need of the hour is to sit down and brainstorm on getting the country out of the expected financial crisis. Political objectives will only survive with financial stability of the country. Nation has suffered multi folds in the past due to political instability, bad policies, security situation and energy crisis.

Mostly we know the reasons behind increased debts and trade gap. We need to stop mourning and start taking actions. Government needs to prioritise its spending towards more economically beneficial projects, reengineer processes in public institutes under losses, increase tax net, increase exports through measures that can ensure price competiveness and find means to decrease unnecessary import of items to boost local industry. One can find multiple articles in print media and talk shows in electronic media stating the same solutions, however, no concrete steps have been taken due to a lack of consensus.

All political parties should arrange an economic summit to address economic challenges. Economists, trade & commerce representatives and large business houses should be invited to share challenges and recommend solutions. It looks easy on paper but is challenging. However, such a challenge has to be accepted to curb the crisis and show the world the true potential of Pakistan.

Wouldn’t it be good if public gets information of why we have increased debts over the years and its utilisation? They should be informed that debt in itself is not an issue, unless its economic benefits don’t justify the cost. Public should also be informed about sources of income of the government and how low tax net and underperforming government institutes are further hampering situation. Unfortunately, public awareness sessions are lacking in this aspect.

One of the prime reasons of trade gap is declining exports over the years. Price and quality competiveness is an emerging challenge. Accepting ground realities in terms of corruption, self-interests of policy makers and short term vision is first step towards addressing the issue.

Pakistan has talented resources in all fields. Only requirement is to keep self-interests aside and think globally as a nation. News like increased investment in automobile sector, 40% increase in number of companies getting registered with Securities & Exchange Commission of Pakistan in November versus the corresponding month last year, China-Pakistan Economic Corridor and allied investments should be publicised with increased frequency in print and electronic media.

Jawad Saleem is a finance expert currently working as country finance head with a multinational retail company, as well as non-executive director at First Capital Group companies. He can be reached via jawadsaleem.1982@gmail.com and tweets @JawadSaleem1982

Published in Daily Times, December 10^th 2017.