The Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has issued a warning that the country may experience negative economic growth in the ongoing fiscal year 2022-2023.
The FPCCI President Irfan Iqbal Sheikh expressed concerns over the state of Pakistan’s economy, despite the implementation of harsh contractionary measures on the dictates of the International Monetary Fund (IMF). Sheikh argued that the fiscal discipline, management of the external account, and economic growth rate in the country are not up to par.
READ MORE: Cross-stuffing of Afghan, Uzbek cargo at Karachi Port hailed by Pak-Afghan Chamber
The IFIs have substantially revised Pakistan’s growth rate projections downwards based on data and economic performance from the last 8-9 months. The World Bank has revised it to 0.4 percent, the IMF to 0.5 percent, and the Asian Development Bank to 0.6 percent. However, independent economists are projecting the year-end growth rate to be in negative figures, ranging from -1.0 percent to -2.5 percent, which would be the most unfortunate economic scenario in the country’s history.
To protect the country’s exports and export-oriented industries, Sheikh demanded that the Export Finance Scheme (EFS) and Long-Term Financing Facility (LTFF) of the State Bank be offered on favorable terms, with a maximum interest rate of 10 percent, to enable exporters to fulfill their pending export orders feasibly. He also proposed a National Economic Agenda for the next 15 years, with all political parties on board for continuity in economic, industrial, trade, taxation, monetary, agricultural, IT & ITeS, and SME policies. Additionally, Sheikh has proposed a broadened tax base and simplified taxation system in the upcoming federal budget 2023-24.
OICCI expresses concerns over threats to business continuity in Pakistan’s economy
The warning from the FPCCI is a wake-up call for the government to take immediate action to address the country’s economic challenges. The potential negative growth in the ongoing fiscal year can have severe implications for Pakistan’s social, political, and economic fabric. It is essential to ensure fiscal discipline, effective management of external accounts, and measures to promote economic growth.
The government needs to take a proactive approach to engage with the private sector and formulate a comprehensive economic plan that can help Pakistan overcome its economic challenges. This should include policies that promote exports and encourage investment in the country, particularly in the manufacturing and agriculture sectors.
Pakistan has enormous potential to become a leading player in the global economy, given its strategic location, natural resources, and a talented workforce. However, this potential can only be realized through effective policies and a conducive business environment.
In conclusion, the warning from the FPCCI about the potential negative growth in the ongoing fiscal year is a wake-up call for the government to take immediate action to address the country’s economic challenges. The government needs to work with the private sector to formulate comprehensive policies that promote exports, encourage investment, and create jobs. It is time for Pakistan to realize its potential and become a leading player in the global economy.
