Lahore: Pakistan is currently navigating a three-year economic stabilization program, supported by the International Monetary Fund (IMF), covering the period from 2024 to 2027. As the first year of this program draws to a close, experts and policymakers gather to assess its impact and discuss the necessary adjustments to ensure its success.
A key focus of the conference is the management of external debt, which stands at approximately $130 billion, or 23 percent of the country’s GDP. Concerns have been raised about the reliance on annual rollovers of $12 billion in external deposits from China, Saudi Arabia, and the UAE. Experts stress the need to reduce this debt by $3 billion annually over the next four years, utilizing increased workers’ remittances to avoid dependency on future IMF programs.
Another critical issue is the ongoing structural reforms in the productive sectors, which are causing disruptions in existing production structures, employment, and poverty levels. The current strategy of phasing out traditional agricultural crops like wheat and rice without viable alternatives is leading to premature de-industrialization. A well-planned transition strategy is deemed essential for fostering competitive industries and crops.
Urbanization faces setbacks due to changes in property taxation and the perception of real estate investments as non-productive. These policies risk capital flight and the creation of exclusive enclaves, prompting calls for policy reversals to support urban development.
Wealth concentration remains a pressing concern, with approximately 100 families controlling significant assets and stakes in publicly listed companies. The ongoing privatization of state assets could exacerbate this concentration. Proposals include compulsory stock exchange listings for large companies to mitigate this trend.
The current social protection measures are insufficient, with poverty levels alarmingly high at 40 percent. The existing policy focuses on the bottom 10 percent of the population, but experts advocate for expanding coverage to 20 percent and increasing financial support to alleviate poverty more effectively.
Lastly, the hesitancy in adopting solar energy policies is criticized. The focus remains on conventional power generation reliant on imported oil and gas. Experts suggest phasing out these investments and halting new dam constructions, with costs shared between federal and provincial governments.
The conference brings together distinguished economists from Pakistan and abroad to provide insights and guide future policy directions. Their expertise is expected to play a crucial role in shaping the country’s economic path forward.