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No need of further Pak rupee devaluation: Miftah Ismail

No need of further Pak rupee devaluation: Miftah Ismail

ISLAMABAD: Adviser to Prime Minister on Finance, Miftah Ismail has said that Pakistan does not see any further devaluation of rupee in near future.

“Pakistan had to devalue its currency twice – first in December by five percent and then in March by five percent – due to rapidly growing trade deficit,” Ismail said in an interview with Bloomburg media group on Saturday.  The Finance Adviser is currently visiting Washington DC to attend the World Bank and International Monetary Fund (IMF) annual spring meetings.  “Our exports had been going down for the last three years and imports were going up way too fast ; trade deficit was coming too high, therefore it was right time to devalue our currency twice,” he said, adding luckily there had not been any inflation and so far the inflation remained under 4 per cent.  He said now the exports had captured the upward trend as in just March, the exports were up 24 per cent from a year ago.  “So I see good things happening right now and I do not see any further need of devaluation.” To a question regarding World Bank and Asian Development Bank’s projection of low GDP growth during next year, the Adviser said with new power plants coming that will be started with the help of China Pakistan Economic Corridor (CPEC), and with other economic activities in the next year, “we are confident that we should be able to get a 6.25 percent of GDP growth”.

He said the country achieved 5.8 percent growth this year, and even last year’s growth was revised upward to 5.4 percent.

Regarding selling of bonds, Miftah Ismail said last bond was sold in November 2017, and since then the country had not gone back to the bond market. However, he said the country had a plan to sell Panda bonds in China in September or October this year.  In terms of financing gap, he said “right now we are talking to commercial banks and taking commercial loans from commercial banks”.

To another query regarding Pakistan’s inclusion in Financial Action Task Force (FATF) grey list, Ismail said “we have prepared an action reporting plan in this regard and we will share this plan with FATF on 25th of this month”.

“Once, I will go back home I will have a final look at the plan and share it with them,” he said adding Pakistan was expecting to be on the grey list for no more than a year.  He said Pakistan will address all reservations of international community regarding Pakistani anti-money laundering law or counter financing of terrorism laws.  “We will work with the international community, we will work with FATF and International Cooperation Review Group (ICRG) and implement those reforms completely so that we are out of the grey list as soon as possible,” he added.

He said Pakistan wanted to fulfill international obligation and commitments and Pakistan will not allow financing of terrorism and money laundering on its territory.