Hafeez Sheikh says current account deficit reduced by 73 %

Finance Adviser Abdul Hafeez Sheikh said, current account deficit reduced by 73 % during the first 5 months.

Hafeez Sheikh tweeted the foreign exchange reserves of State Bank of Pakistan increased by 1.8 billion dollars during this period.

He said reduction of 3 bn dollars in foreign exchange swaps and forward liabilities increased the foreign exchange buffer by 4.8 billion dollars which provided further stability to external account.

Current Account Deficit is down by 72.6% in Nov 2019 & 73% between July-Nov 2019 vs same period in 2018.
In 5 months, increase in SBP Reserves by $1.8B & reduction of $3B in FX swaps/forward liabilities increased FX buffer by $4.8B providing further stability to external account. pic.twitter.com/TLODiizRsi

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— Dr. Abdul Hafeez Shaikh (@a_hafeezshaikh) December 20, 2019

State Bank  said country’s current account deficit stood at $ 1.821 billion in  FY20 compared to last year (FY19).

This deficit depicting a notable decline of $ 4.912 billion.

Hafeez Press Conference

Earlier, Sheikh said that world’s leading financial institutions had given Pakistan their vote of confidence.

They have acknowledged the improvement over the past five months in its economic indicators.

He said Moody’s rating to Pakistan have moved from negative to stable.

He said unprecedented $ 1bn portfolio investment made.

Furthermore, he said investors’ confidence assessed from the fact that stock market crossed 40,000 points.

The advisor also called attention to the fact that Bloomberg  announced Pakistan’s stock market performed best in dollar terms over past 3 months.

He said country experienced a 16 % increase in tax revenues over  past 5 months and government expenditures tightly controlled.

“No supplementary grant given neither someone allowed any needless expenditures.”

He said owing to this, Pakistan’s “primary balance is in the surplus”.

Sheikh said that the State Bank of Pakistan’s reserves had also not only remained stable, but had risen in the past few months.

He said the government aims to raise exports so businessmen can earn more.

Sheikh said the export sectors were being offered loans at an interest rate lower that the current market rate of 13.25pc.

Hafeez Sheikh said the government also aims to increase construction activity and to offer subsidies to low-income families.

Abdul Hafeez Sheikh reminded the media that exporters are currently not taxed while exporting items.