Economic sovereignty from IMF secured: PM
Staff Report

ISLAMABAD—Prime Minister Shaukat Aziz Wednesday said our economic philosophy and reforms have yielded positive results and unleashed the growth potential of our economy and we have outgrown our dependence on International Monetary Fund programme and achieved an unprecedented measure of economic sovereignty.
“Our reforms have provided a transparent and predictable policy framework, freed trade and investment, provided a level playing field for all stakeholders, and aligned our economy to global norms and practices,” he observed this while addressing 30TH export awards of FPCCI and ground breaking ceremony of its corporate office at Islamabad. Federal Minister for Commerce Humayun Akhtar Khan also addressed the ceremony. Prime minister also distributed trophies and Gold medals among 81 exporters for their remarkable services in the sector.
The premier said seven years ago, when President Musharraf assumed responsibility of the government, Pakistan was in dire straits, beset with festering problems of misgovernance, dysfunctional institutions and a sagging economy. We have since implemented an ambitious and all-encompassing reform agenda, covering all aspects of national life - political, administrative, social and economic. This has brought about a sea-change in the country and the process of national renewal is well under way. “In the economic sphere, we have successfully implemented a stabilization programme and wide-ranging structural reforms, which have put the economy back on the track of sustainable growth and poverty alleviation. IFC and the World Bank in a recent report “Doing Business in 2006” has declared Pakistan as the top reformer in the South Asian region and number 10 reformer globally. We are now one of the fastest growing economies in the region and hope to sustain a high growth rate of 6 to 8%. Our poverty reduction strategy has brought down the number of people below the poverty line from 34.5% in 2001 to 23.9% in 2005. In other words, 13 million people have been lifted out of poverty in just four years.”
The prime minister said: “as you know, we have a deep and well considered philosophy underpinning our reforms. Our economic reforms are driven by the philosophy of deregulation, liberalization and privatization. We rely on market forces and structures rather than control mechanisms and centralized planning as the main drivers of economic activity.”
“The central thrust of our economic strategy is to create an enabling environment for the private sector to become an engine of growth. Our strategy for improving the investment climate is multi-pronged - marked by financial sector, trade and taxation reforms, dismantling of archaic procedures, better enforcement of civil contracts and documentation of property rights, infrastructure development and, above all, ensuring consistency and continuity of government policies.”
He also made it clear the policy of liberalization and deregulation does not mean that the government has abdicated its role. In fact, in a deregulated environment, the government has a more important, albeit a changed, role to play. It is well known that some markets are prone to what is called market failure or in other words, distortions and inefficiencies. It is here that government has a role to correct the market failure and improve the efficiencies of the markets. It is in this perspective that we are currently implementing a series of reforms - what is known as second generation reforms - to sustain a growth momentum of 6 to 8% per annum.
Besides strengthening institutions and physical infrastructure, he said our reform agenda includes improving the competitiveness of our industry, building a robust financial system in an environment of global financial restructuring, further strengthening of tax administration, promoting transparency in economic policy formulation, further reform in capital markets and improving the country’s human capital.
The prime minister said improved infrastructure is another critical element in the investment environment of any country. Uninterrupted power supply at competitive rates, good quality road, rail and telecommunication network, efficient port operations, and quick custom clearance at the port are important ingredients of good investment climate which in turn is vital for sustaining growth momentum.