Pakistan exploring debt for nature swaps with global agencies: Shamshad Akhtar

ISLAMABAD: Caretaker Minister for Finance, Revenue and Economic Affairs, Dr Shamshad Akhtar, said that amid growing international fiscal constraints, the country is exploring debt-for-nature-swap with global agencies to enhance its market competitiveness as foreign direct investment is harder to fetch in these testing times.

She was speaking at a high-level plenary titled: “Reforms for a Brighter Future” on the last day of the 26th Sustainable Development Conference organized by the Sustainable Development Policy Institute on Thursday.

Dr Shamshad Akhtar said after months of hard work, the interim leadership has successfully reached a staff-level agreement with IMF for a standby $3 billion loan grant. She added that the interim regime was committed to the IMF program which should be a homegrown agenda of Pakistan, the state news agency reported.

“Marco’s economic stability has become more difficult in the last decade due to delay in structural reforms, surge in global commodity prices, and tightening of financial restrictions,” she said. She also highlighted the country’s rising vulnerability to climate shocks that had increased manifolds. She expressed her optimism for the forthcoming COP-28 international climate moot and hoped to have a positive discourse at the forum.

Dr Abid Qaiyum Suleri, SDPI Executive Director, said Pakistan’s economic problems were diagnosed some 70 years ago and we all are aware of the problems and their solutions. He stressed the need to work out a mechanism to address all the challenges. He said the country is also showing huge resilience after facing a plethora of crises with the hope of a better future.

Keynote Speaker, Dr Luis Felipe López-Calva, Global Director, Poverty and Equity Global Practice, The World Bank said to understand the prevailing crisis, the first thing is that the world has entered a structurally lower growth. In Pakistan, he said, the economic growth was insufficient to reduce poverty whereas the external elements or partners could not bring change in an economy.

Najy Benhassine, the World Bank Country Director, said the human capital crisis is a silent disaster that did make news headlines as 40% of children under 5 years of age in Pakistan are stunted which is the most pressing challenge for the long-term growth of Pakistan.

“Economic difficulties are not new for Pakistan but rather recurring as the global shocks, COVID-19 crisis and floods further aggravated the situation in Pakistan,” he added.  He suggested prioritizing the issue by focusing on child stunting reduction, quality of water and availability nexus, human capital crisis, developing the private sector, the energy sector which is vital for RE transition and important for macroeconomic stability, water and agriculture nexus, low agriculture productivity and creating fiscal space because it will require huge finances.

Speaking at a panel discussion titled: “The Governance Approach” the former Advisor to the Prime Minister on Institutional Reforms and Austerity, Dr Ishrat Husain, has said the continuity of reforms and policies needs to be ensured amid community and youth ownership to achieve the objective of improved governance in the country.

He said under the Civil Service Reforms, a six-pronged strategy focusing on aptitude, leadership, career planning and promotion, performance, incentives and direct retirement helped in bringing a change in the conventional civil service to make it more proactive and in line with the developing world trends.