1、PRESENTATION ON The Present Economic Outlook for Pakistan,ByMinistry of FinanceGovernment of Pakistan,April, 2006,Outline of Presentation,Key Macroeconomic Challenges of the 1990s How did we address those challenges Where Are We Now? Where do we want to see Pakistan in the next five years Key Macroe
2、conomic targets for the next five years New Challenges How to address new challenges Concluding remarks,Overcoming macroeconomic challenges,1990s Macroeconomic Scenario Macroeconomic imbalances leading to buildup of public debt, deceleration of growth and investment, and stagnation in exports Challe
3、nges of the 90s Improve macroeconomic environment Bring debt situation under control Restore investor confidence Revive economic growth Restore financial sovereignty 2000-onwards: Two-pronged Strategy followed Policies pursued to strengthen macroeconomic environment Introducing wide-ranging structur
4、al reforms,6,Policies pursued to strengthen macroeconomic environment,Reducing “Twin Deficits” Keeping inflation low Building foreign exchange reserves Maintaining stability in exchange rate Maintaining consistency and continuity in policies,7,Strong commitment to reform agenda,Major economic reform
5、s,Tax Reforms,Governance Reforms,Capital Market Reforms,Industry & Investment Reforms,Fiscal Transparency,Agriculture Sector Reforms,Financial Sector Reforms,Deregulation & Privatization,Fiscal Responsibility & Debt Limitation Act,8,Pakistans economy has made significant progress during the last six
6、 years,9,Where Are We Now ?,Robust Economic Growth,Real GDP growth (% yoy change),Source: Federal Bureau of Statistics,6.5,7.0,Per Capita Income ($),Per Capita Income Continues to Rise,Source: Federal Bureau of Statistics,New Jobs Created,Source: Labour Force Survey, FBS,Reduction in Poverty,Source:
7、 Center for Research on Poverty Reduction and Income Distribution (CRPRID),Foreign investment,Foreign Investment (US$ million) including Privatization Proceeds,Source: SBP,Net Credit Flows to the Private Sector,Banks,Fuel & Energy,Non Energy Non Banks,Rising Profitability Driving Growth,Source: KSE,
8、Currency stabilization and buoyant stock market reflects optimism in the Pakistan economy,Source: Bloomberg,Exchange rate (PKR/USD),Pakistans Karachi Stock Exchange Index - 100,25,Improving budgetary position,Overall fiscal deficit (% of GDP),Source: Ministry of Finance,Growing Revenue Collection he
9、lps boost up the economy,Increase Revenue Collection (Rs. Billion),Source: Ministry of Finance & CBR,Overall interest payment ratios have improved,Interest Payments (As % of Total Revenue),Source: Ministry of Finance,Low inflation has provided monetary flexibility,Source: FBS,Inflation (%) (Base yea
10、r 2001 = 100),Month-wise Trend in Inflation,Supply Side Actions,Projected,Regional Price Comparison of Essential Commodities,Source: FBS & Ministry of Commerce,Money Supply, Inflation & Growth,M2,Nominal GDP,Inflation,Real GDP,Low interest rates encouraged private investment and fuelled growth,Weigh
11、ted Average Lending Rate (% per annum),Source: SBP,Exceptionally strong external liquidity,Source: SBP,Imports and Exports (US$ million),As confidence in the economy builds, remittances from abroad have risen sharply,Source: SBP,Remittances (US$ million),Current account (% of GDP),Current account de
12、ficit remains under control,Source: SBP,Financial Flows (Million $),2005-06 2004-05 Privatization Proceeds 1645 363 Grants 637 231 Capital Markets 1500 600 Project & Program Aid 2893 2044 Foreign Investment 1850 1676 Total 8525 4914 Current Account Deficit -5353 -1753 Amortization -1042 -1434 Other
13、Payments - 416 -1500 Total -6811 -4687 Addition to Reserves 1714 227,Source: Ministry of Finance,.aided by a phenomenal buildup in FX reserves,Source: SBP,Foreign exchange reserves (US$ billion),Debt Profile of Pakistan,PUBLIC DEBT (As % of GDP),( End June ),Source: Debt Office, Ministry of Finance,
14、EXTERNAL DEBT AND LIABILITIES (% of Foreign Exchange Earnings),Significantly reducing vulnerability to external shocks,Source: Debt Office, Ministry of Finance,INDICATORS OF DEBT BURDEN,External Debt (As % of GDP),Source: Debt Office, Ministry of Finance,INDICATORS OF DEBT BURDEN,External Debt As Mu
15、ltiples of FX Reserves,Source: Debt Office, Ministry of Finance,Pakistans Economy In the Next Five Years,Pakistans Economy in the Next Five Years,Strong Economic Growth Ranging between 6 8% p.a. Stable Macroeconomic Environment Debt Burden Reaching Sustainable Level Lives of the Common Man Improving
16、 Social Indicators Improving,Key Macroeconomic Targets For The Next Five Years,Key Macroeconomic Targets for the Next Five Years,Sustainable Budget Deficit Ensuing Macroeconomic Stability,Continue to Maintain Macroeconomic Stability,Source: Ministry of Finance,Public Debt Attaining Sustainability,Co
17、ntinue to Maintain Macroeconomic Stability,Key Macroeconomic Targets for the Next Five Years,Source: Ministry of Finance,Country No Longer Vulnerable to External Shocks: External Debt As % of GDP,Continue to Maintain Macroeconomic Stability,Key Macroeconomic Targets for the Next Five Years,Source: M
18、inistry of Finance,Investment as % of GDP Rising,Rising Investment,Key Macroeconomic Targets for the Next Five Years,Source: Ministry of Finance,Pakistan on a higher Growth Trajectory,Sustaining Growth Momentum,Key Macroeconomic Targets for the Next Five Years,Source: Ministry of Finance,New Challen
19、ges,Second generation reforms,Second generation reforms,32,Continuing Economic Agenda,i. Curtailing High Energy Costs Power Sector Reforms Hydel Power Gas Pipelines Reforms of Oil and Gas industry ii. Removing Water Shortages Water Reservoirs Management of Water Resources Efficient Usage at the Farm
20、 Level,Continuing Economic Agenda,iii. Improving Logistics & Removing Supply Chain Constraints National Trade Corridor Retail & Wholesale Markets Development Ports Modernization Modernizing Transport Fleet iv. Unlocking the Land Bank NIPs (National Industrial Parks) Release of Government Land ( Defe
21、nce, Railways, Provincial Governments etc.) Computerization of Land Transactions,Continuing Economic Agenda,v. Removing Skills Gap & Enhancing Productivity NTEVTA 5 New Engineering Universities & HEC Initiatives Education Sector Reforms vi. Boosting Agriculture Sector Development Livestock Sector Fi
22、sheries Horticulture & Value Added Agriculture Research & Extension Services Yield Enhancement,Continuing Economic Agenda,Tourism & Hotel Industry ExpansionSMEs & One Village One Product ix. Sustaining Industrial Development Beyond Textiles x. Developing Knowledge Based Industry & Outsourcing xi. St
23、rengthening Growth Prospects of Service Sector xii. Obtaining Preferential Access to Global Markets,Conclusions,Economy Continues to Grow Strongly Reduction in Unemployment Growing Profitability of Private Sector Robust Banking System Strong Growth in Diversified Sectors Vibrant Telecom Sector Strong Domestic & External Demand Sustaining Economic Growth Growing opportunities in Infrastructure Growing Role of the Private sector,
