Members of the Overseas Investors Chamber of Commerce and Industry (OICCI) met with Dr. Murtaza Syed, Acting Governor, Dr. Inayat Hussain, Deputy Governor, and Sima Kamil, Deputy Governor, of the State Bank of Pakistan (SBP) to discuss the urgent fiscal and monetary policy actions that must be taken to help stabilise Pakistan’s economy.
The discussions were led by Ghias Khan, President of the OICCI, and Abdul Aleem, Secretary General of the OICCI, who voiced member concerns about the pre-approval process of Letters of Credit (LCs) for the import of machinery and spare parts, on-time remittance payments, approval exemptions of shipping values being too low, and other operational issues. The SBP leadership was urged to impose deadlines in order to protect the supply chain of the business.
The SBP team provided a thorough review of the state of the economy now and the proposed approach to solving problems in 2023. With consumption accounting for up to 95% of the GDP, Pakistan is predominantly a consumer-driven economy. The SBP team advised the OICCI members to improve exports in order to counteract currency depreciation and exchange rate variations. The SBP team was optimistic that Pakistan’s issues will pass quickly.
Said Ghias Khan, “a much needed first step towards the recovery of Pakistan’s economy. It is imperative that we implement cogent measures to halt our pattern of circular debt. The SBP has always played a critical role in stabilizing Pakistan’s economy, and I am confident that under Dr. Murtaza Syed’s leadership we will be able to withstand the current economic climate while charting a path for growth.”
“SBP is taking severe steps and making painful decisions to help prevent the economic disaster,” said Dr. Murtaza Syed. One of the primary reasons why Pakistan is currently at a crossroads is the combination of global inflationary pressures and a procyclical expansionary fiscal policy during a procyclical time. The burden on the economy will lessen after these steps are taken and the IMF loan is obtained, particularly with reference to the weakening Rupee.
OICCI plays a significant role in the expansion of trade and industry in the nation by acting as a forum for promoting foreign investments. OICCI invested USD 2.4 billion in total last year, making about one-third of all taxes collected in the nation.