Lagarde Calls on Pakistan to Build on Progress and Seize Opportunity to Complete Economic Transformation

IMF News, October 25, 2016

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Ms. Christine Lagarde, Managing Director of the International Monetary Fund (IMF), issued this statement at the conclusion of her visit to Pakistan.
Condolence and context:
- “I would like to start by offering my condolences to the Pakistani people for the tragic loss of lives at the Quetta attack overnight. We are deeply sorry for the families of those who lost their lives in this horrific attack.”
Acknowledgements:
- Thanks to Prime Minister Nawaz Sharif, Finance Minister Ishaq Dar, Central Bank Governor Ashraf Wathra, and other senior government officials for productive exchanges and hospitality.
Program status:
- “I congratulate Pakistan on having successfully completed its IMF-supported economic reform program.”
- “While the IMF-supported program has been completed, Pakistan’s partnership with the IMF continues through our ongoing close policy dialogue and capacity building engagement.”

Macroeconomic and fiscal outcomes:
- Improved macroeconomic stability.
- Strengthened external buffers and public finances.
Revenue and social spending:
- Many tax exemptions and concessions have been removed, and higher tax revenue has allowed for greater public investment and social spending.
- About 1.5 million more poor households are benefiting from targeted social assistance than three years ago.
Energy and infrastructure:
- Power outages have gradually decreased and the financial performance of the power sector is strengthening.
Business climate:
- A country-wide strategy to improve the business climate is being implemented.

Strategic imperative:
- “Much has been achieved and much more remains to be done, so this is Pakistan’s moment of opportunity to forcefully address remaining economic challenges and lay the foundation for more private sector job creation and higher living standards for all segments of society.”
Resilience:
- Need to continue strengthening resilience by building fiscal and external cushions to be adequately prepared for future economic shocks.
Structural reforms called for:
- Completing important structural reforms in the energy sector.
- Reforming tax policy and administration.
- Ending losses in public enterprises.
- Making a sustained effort to improve governance and foster a dynamic and export-oriented private sector.
Social and inclusion priorities:
- Added focus on strengthening health, education, closing the gender gap and providing social protection to ensure gains in living standards are widely shared.

Meetings and perspectives:
- Ms. Lagarde met with students, women leaders, representatives of the business community, and civil society and thanked them for their perspectives on Pakistan’s opportunities and challenges.
Demographics and labor force participation:
- “Pakistan’s economic transformation cannot happen without the country’s youth—who comprise about 60 percent of the population—and women, of whom only one in four participate in the labor force.”

IMF role:
- Continued close policy dialogue and capacity building engagement to support Pakistan as it addresses economic challenges and realizes its economic potential.
Support reiterated:
- “I would like to reiterate the IMF’s strong support for Pakistan as the country moves forward to address its economic challenges and realize its vast economic potential.”

Press Release No. 16/467 — October 25, 2016. IMF Communications Department.