Karachi, March 25, 2023 (PPI-OT): Mr. Suleman Chawla, Acting President of the apex body, i.e. FPCCI, has strongly criticized the team of country’s economic managers for lack of direction; non-existent consultative process between the government and the business community and an unprecedented long-drawn-out waiting period before the IMF deal could be revived.

He reiterated FPCCI’s stance that most of the major economies of the world have a share of regional trade in upwards of 70 percent; whereas, Pakistan’s trade with the regional countries have never been able to take off and now it seems to have gone into a reverse gear.

Mr. Suleman Chawla added that exports and remittances – the two mainstays of generating foreign exchange for the country – are in a freefall; as exports to nine regional trade partners have declined by 18.3 percent in the first eight months of FY23; over all textile exports have declined by 11 percent with a contraction of 30 percent in February 2023 on a MoM basis and decline in country’s exports has been steady over the last eight months.

Mr. Suleman Chawla apprised unequivocally that FPCCI is observing with profound concerns that the decline in exports is incrementally snowballing into a complete nosedive, as on a YoY basis, October 2023 saw a 3.25 percent decline; November 17.6 percent; December 16.3 percent and January 2023 witnessed a decline in exports to the tune of 15.4 percent. This is a systemic decline; and, need to be arrested through a broad but effective consultative process, he added.

Acting FPCCI Chief noted that remittances experienced a 32-month low in January 2023 with a mere $1.89 billion inflows; which should have sent shivers down the spine of country’s economic managers. He added that country’s total foreign exchange reserves (FER) would have been close to $15 billion currently; if the government had managed only one aspect of the external inflows, i.e. worker’s remittances well and if they had not declined by 20 percent on a YoY basis – and that, by now, would have been the decisive factor in the successful materialization of IMF’s 9th review.

Mr. Suleman Chawla maintained that Pakistan’s total FER are just above $10 billion after accounting for the reserves with the commercial banks as well and SBP has only $4.6 billion. SBP reserves are what really counts, he added.

FPCCI has demanded that the government should bring forth some transparency and clarity vis-à-vis its management of external account; and, what exactly is hampering the IMF staff-level agreement (SLA). Mr. Chawla also demanded that government should also outline the subsequent steps for stabilization of the economy after and if IMF deal is finally struck.

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