Finance Minister Ishaq Dar on Wednesday assured investors at the Pakistan Stock Exchange (PSX) that the country will not default but did admit that the economy was in a “tight position”.
In his address, the minister said he always believed that Pakistan has a prosperous future and “resilience” in its economy. However, he lamented that it was unfortunate that the country has been brought to a point where it should not be.
“It’s been three months since I took charge and we listen every day that there is going to be a default. How will there be a default? There is no chance that Pakistan will default,” the finance minister assured the investors.
Dar said that Pakistan would survive and is managing itself but conceded that the economy was in a “tight position”.
The country does not have the $24 billion reserves that the Pakistan Muslim League-Nawaz (PML-N) left in 2016, he added.
“The fault is in the system and we must ensure Pakistan goes forward,” said the finance minister.
Dar said that as soon as the country’s bond payments came close a “rhetoric” was started that Pakistan will not be able to fulfill its commitment.
The rumours were spread by the same people who brought Pakistan to this point, he lamented.
“Be conscious, do not listen to them. Disseminate information that Pakistan will not default. I can prove to anyone that Pakistan will not default,” the finance minister maintained.
He said that for “petty politics and objectives” the country was being harmed.
To prove his point, the finance minister said that Pakistan’s debt-to-GDP ratio is currently 72 percent while it was 62 percent when he left the charge in his last stint.
He also gave examples of other countries to further prove his point by saying that the US’s debt-to-GDP ratio is 110 percent, Japan’s is 257 percent and UK’s after COVID is 101 percent.
“I can give you data of dozens of developed countries who are above 100 percent but I don’t see an alarm there all the time that we are under the debt trap or difficulty. Unfortunately, we are our own worst enemy,” said the finance minister.
Dar told the investors that they have a big role to play and urged them to allocate some time to Pakistan apart from their businesses. He added that everyone needs to work together.