ISLAMABAD: Finance Minister Senator Mohammad Ishaq Dar Tuesday hailed reaffirmation of Pakistan credit rating by Fitch Ratings and said it was an acknowledgment of government’s economic policies.
Talking to media here at the signing ceremony of US$325 mln with Asian Development Bank, the finance minister said Fitch Ratings had affirmed Pakistan’s rating at ‘B’ with a ‘Stable’ outlook confirming the progress achieved by the present government under its economic reform agenda.
He said it was due to prudent policies of Prime Minister Nawaz Sharif that helped to lead the country towards economic development.
Fitch recognized that the country’s foreign exchange reserves had strengthened, fiscal deficit had reduced and significant progress had been made on structural reforms, he said.
Fitch further acknowledged that the country’s economic outlook had brightened and looked promising in the current fiscal year on the back of agricultural recovery and an influx of investments under the China Pakistan Economic Corridor, he said.
The minister said Fitch forecasted continued strong domestic demand, with private consumption and faster credit growth.
He said Fitch also appreciated the performance of the banking sector and the improvements shown across IMF’s Financial Soundness Indicators wherein the percentage of non-performing loans had also fallen considerably.
Fitch forecasts Pakistan’s debt-to-GDP ratio to gradually fall in the medium term as a result of continued fiscal consolidation, he said.
The report also highlighted the reduction in general government budget, with revenues boosted by structural reforms, including the withdrawal of a number of tax concessions, he said.
Dar said the budget deficit had also been projected to continue narrowing gradually as the government remains committed to policy reforms.
He said Fitch did not expect Pakistan to face external liquidity difficulties as Pakistan demonstrated market access in October 2016 by issuing US dollars.