Pakistan needs an IMF Plus: Pakistan's former finance minister Hafeez Sheikh

In the latest episode of On my Radar, hosted by Nukta CEO and founder Kamran Khan, former finance minister Hafeez Sheikh said, "At this time, the IMF is necessary but not sufficient; we need 'IMF Plus'."

"Why hasn’t Pakistan benefited from the global economy in its 75-year history? Since 1947, we have failed to increase our exports beyond $30 billion. We don’t have any significant economic relationships with other countries where foreign investment is flowing in or where we are exporting goods.

We also need to consider why our private sector has failed to form any alliances in the last 75 years. Trillions of dollars are flowing through the global economy, yet we haven’t been able to attract the world towards us. In Pakistan’s history, the pace of income growth has never established a trend lasting more than four years. Pakistan can reach 6% economic growth, but it hasn’t been able to sustain it.

There has been no political stability in Pakistan, and predictability of policy is essential for economic improvement. To date, no prime minister in Pakistan has completed a full term in office. We are always preparing for war, involved in war, or dealing with the aftermath of war.

The IMF doesn’t ask us to come to it; when we approach the IMF, other institutions and markets gain confidence that we won’t make any further mistakes. Other institutions and markets are then willing to provide additional support. In a way, the IMF serves as an instrument of certification.

The IMF may provide $7 billion, but our need is for $50 to $100 billion. We need to think about what steps we must take to move beyond the IMF program.

Currently, we are in the ICU, and we need to move from here to the general ward. Those managing Pakistan’s economy need to engage in strategic dialogue with the world's key players. We need to assure the international market that we have all the arrangements in place to repay $30 billion of debt next year. The world should be aware of our agreements with the provinces, whether it is achieving a primary surplus or meeting the current account target; we will work together."