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March 28, 2020

World Bank Chief Impressed by Pakistan’s Success at Stabilizing Economy

Islamabad – World Bank Managing Director and Chief Operating Officer Sri Mulyani Indrawati wrapped up her 3-day visit to Pakistan, impressed by the government’s success at stabilizing its fragile economy which needed IMF support two years ago to stave off an imminent default on its external payments.

During her three day trip to Islamabad that ended Aug. 4, World Bank’s top official met Prime Minister Nawaz Sharif and Finance Minister Ishaq Dar and heard updates on the progress of economic reforms being implemented by the government, according to a statement issued by the World Bank.

“I have been impressed with the government’s success at stabilizing the economy under difficult circumstances, and I support its aim to accelerate sustainable and equitable growth to lift more people out of poverty,” said Indrawati. “The priorities that we discussed include initiatives to improve people’s everyday lives, such as energy, health, education, and the social safety net—as well as expanding the tax base and strengthening governance and capacity of key institutions to support these services.”

The World Bank Group’s program in Pakistan is governed by its Country Partnership Strategy agreed with the government. The World Bank Pakistan portfolio has 25 investment lending projects under implementation with a total net commitment of $4.95 billion.

IFC, the World Bank Group’s private sector arm, has a committed portfolio of about $1.2 billion in 47 companies, of which infrastructure – energy, ports, and transport – accounts for 53 percent, general manufacturing and services 15 percent, and financial markets 32 percent.

Pakistan’s economy grew by 4.24 percent in the fiscal year that ended June 30, helped by a set of reforms in line with an IMF program. Pakistan secured $6.6 billion loan from the IMF in 2013 in the face of a balance of payment crisis. Reforms carried out under the program have since helped bring the economy back on rail.

Ms. Indrawati also met Chief Minister Shahbaz Sharif of Pakistan’s central Punjab province and was encouraged by the joint effort of the Federal and Provincial Government to expand the Benazir Income Support Program (BISP) – the government’s biggest social safety net for the underprivileged class.

She emphasized the importance of the private sector’s contributions to the growth and development of Pakistan during her visit with representatives of academia, think-tanks, private sector, civil society, diplomatic missions, and development agencies.

She pointed to the youth bulge as a potential asset for Pakistan’s development, but to benefit from this would require improvements in education and training, including for girls and women. “Increasing numbers of young people in Pakistan mean job creation is a priority, and this will require improvements in the business and investment climate, privatization, and tapping the potential of regional integration,” said Indrawati.

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