Pakistan Meets All Debt Obligations and Achieves Economic Stability

The Ministry of Finance‘s monthly economic outlook report released on Tuesday has some good news for Pakistan. According to the report, the country has met all its debt obligations in a timely manner and is comfortable with its medium to long-term obligations.

The government has a vibrant financial plan in place for FY23 and is focusing on balanced economic policies to ensure sustainable growth. However, the additional requirement of substantial expenditures on flood-related activities and the need to allocate additional funds to maintain the law-and-order situation due to the ongoing long march have put pressure on total expenditures.

The report also mentions that inflationary pressure is expected to marginally ease out month-on-month basis due to smooth domestic supplies, unchanged energy prices in November and a stable exchange rate. Furthermore, the food supply chain disruption caused by flash floods is also settling down which has smoothened the food and other related markets.

On the export side, sluggish foreign demand, and domestic supply issues, following the floods-induced destruction of exportable crops are responsible for the weak export performance. However, in the coming months, it is expected that exports will improve on account of targeted policies announced recently by the government to stimulate exports.

The report concluded that the expected improvement in the trade balance will be reflected in the current account balance. This is a positive sign for Pakistan and shows that the country is on the right track to meeting its debt obligations.