Parliament hindering tax reforms: Hafeez

WASHINGTON: Federal Finance Minister Abdul Hafeez Sheikh, who is heading a delegation of top economic managers to the International Monetary Fund and the World Bank spring meetings, has said the Pakistan government had strived to bring the budgetary deficit down to 4.5% and impose further tax reforms but was hindered by a reluctant parliament.

He stressed that Pakistan needed trade, not aid, to gain access to the European markets. Pakistan can’t afford to rely on constant aid, Hafeez said, also hinting at the ‘possibility’ of at least one more IMF tranche to achieve an equilibrium in its finances. He said tax related charges concerning 4,000 commercial organisations had been filed in the courts.

According to a media report, in the first phase of the talks, the finance minister informed the IMF and WB about the economic preferences of the government. The IMF, on its part, strongly advised that Pakistan cater to economic challenges on its own; a factor which troubled the Pakistani delegation. The finance minister also held a meeting with the visiting Chinese delegation, and invited Chinese investment to Pakistan. —Online

NNI adds: In separate meetings, Finance Minister Hafeez Sheikh discussed development partnerships with the leaders of major economic powers on the occasion of the annual gathering of the IMF and World Bank. Sheikh briefed German, British and American leaders about the government’s focus on development as well as its efforts towards greater economic stabilisation.

German Finance Minister, Dick Niebel, offered his country’s support for Pakistan’s hydropower projects and small dams. In another meeting, Sheikh and the UK Secretary of State for International Development, Andrew Mitchell, discussed the economic ties between the two countries. Mitchell appreciated Islamabad’s commitment to economic reforms.

The finance minister also had a meeting with US Undersecretary of State for Economic, Energy and Agricultural Affairs, Robert Hormats, and discussed the economic development cooperation. The US official assured Sheikh of Washington’s support in getting greater trade access for Pakistan to the European Union.

Earlier, Sheikh met his Chinese counterpart at the World Bank as the two officials pledged to step up implementation of economic partnership agreements. He is also scheduled to hold meetings with his counterparts from Saudi Arabia, Afghanistan and Iran during the IMF-World Bank meetings.

The finance minister’s delegation to the IMF-WB gathering includes Secretary Finance, Waqar Masood Khan, Chairman, Federal Board of Revenue, Salman Siddique, Governor, State Bank, Shahid Hafeez Kardar, Deputy Chairman, Planning Commission, Nadeemul Haq, Secretary, Economic Affairs Division, Abdul Wajid Rana and Counsellor, Economic Affairs at the Embassy, Zahid Hafeez.

APP adds: Sheikh met the top International Monetary Fund officials here on Sunday as part of the ongoing dialogue and discussed progress in the Fund’s ongoing $11.3 programme for Pakistan. Under the programme, Pakistan has so far received $8 billion.

Ahead of the fifth review of the performance for the release of the remaining two tranches of $3.8 billion, the finance minister met the IMF leaders, including Deputy Managing Director Nemat Shafik, Director, Middle East, Masood Ahmed, and IMF Mission Chief for Pakistan Adnan Mazerie. Shaikh described the dialogue with the IMF as ongoing.