Daily Times

KARACHI: Pakistan and Saudi Arabia will decide the quantum and areas of Saudi investment in a meeting with the kingdom’s delegation to Pakistan, which is due to arrive in the country during the first week of October, said Federal Minister for Finance, Revenue and Economic Affairs Asad Umar on Sunday.

Speaking exclusively to Arab News, the minister rejected recent media reports that claimed Riyadh would “invest $10 billion in Pakistan,” dismissing the impression that the volume of investment had been ascertained yet.

“The prime minister’s visit was meant to make agreements at the highest level with the King of Saudi Arabia and build a stronger relationship. In principle, only verbal discussions have taken place so far,” he added.

Umar noted: “We have discussed trade-related issues, foreign direct investment, visa fees, and issues faced by our laborers.”

The finance minister also dispelled the notion that Pakistan was facing a financial emergency. “Pakistan is not in an emergency situation that requires it to rush to the International Monetary Fund (IMF) to seek a bailout,” he maintained.

“We have neither stopped imports nor imposed financial sanctions,” said the minister. However, he emphasized that it was important to be prudent while taking economic decisions.

“We need to take well-measured decisions. As a situation emerges, we take steps to manage it. We don’t want to take decisions in emergency.”

The staff mission of the IMF is scheduled to arrive in Pakistan on September 27 to engage with the Pakistani authorities. “We are in discussion with them, but this is not to negotiate for a loan. Our purpose is to do our homework, in case we want to approach them at some stage,” the minister clarified.

Responding to a question about managing the balance of payment deficit, Umar said: “We are eliminating the root cause of this problem, and that root cause is fiscal deficit. We have done that through the recent finance bill, which will reduce our cost of import.”

He said that during his visit to Saudi Arabia and the United Arab Emirates, Prime Minister Imran Khan discussed measures for trade enhancement and investment. “These are measures, which will help fill the external financing gap,” he noted.

He also said Pakistan was constantly in touch with international commercial markets and banks for financing.

About the measures to increase the country’s exports to ease its external payment obligations, the finance minister said the issue had been discussed in detail with the Chinese authorities.

“During the upcoming international trade exhibition, which will be attended by the prime minister as one of the chief guests in China on November 4 and 5, we will discuss items line by line so that they can give us trade concessions to increase exports to China.”

“Similarly, when the Saudis will come, decisions will be made here in Pakistan about trade enhancement and investment,” he added, hoping that these steps would mitigate the balance of payments crisis. The government is also planning to float overseas, dollar-based saving certificates for Pakistanis living abroad. The finance minister said the amount of issue would be decided at the time of floating these certificates. “We will float them in October, but it will not be a one-time issue. We will be floating these certificates periodically for overseas Pakistanis,” said the finance minsiter.

Published in Daily Times, September 24^th 2018.