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IMF demands govt submit new report on state-owned enterprises’ losses

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1 year ago

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  • Central Monitoring Unit team asked to submit report.
  • Fund says it won’t accept reports based on old statistics.
  • IMF’s review mission visiting Pakistan from Nov 13-16.

ISLAMABAD: The Finance Ministry has been asked by the International Monetary Fund (IMF) to submit a fresh report regarding the losses incurred by state-owned enterprises, Geo News learnt from sources on Monday.

The Fund’s mission, which is currently in Pakistan to review the country’s loan tranche, said it won’t accept the reports based on old statistics, the sources said.

Therefore, it has demanded that the Central Monitoring Unit team submit its first updated assessment report for the first quarter of the current financial year.

The IMF’s review mission is in Pakistan currently to complete the first review under the $3 billion loan programme and the possibility of releasing the second tranche of $700 million by the end of December 2023. The tranche would go through if both sides are able to strike a staff-level agreement at the end of the talks.

Pakistan and the IMF teams are currently holding technical-level talks while the policy-level talks will be held next week from November 13-16.

The Finance Ministry, on the other hand, has sought time from the IMF for submission of the report by December 2023, sources added.

In its reply to the Fund’s delegation, the team said that government-owned enterprises are currently under scrutiny and the new statistical report will soon be completed, the sources said.

Pakistan’s fiscal framework IMF’s focus

Earlier today, The News reported that the visiting IMF mission is focused on Pakistan’s fiscal framework for the ongoing financial year 2023-24 to turn the primary deficit into surplus under the $3 billion standby arrangement (SBA).

The IMF is not concerned by the overall rising fiscal deficit due to the escalating debt servicing of Rs1 trillion for the current fiscal year. The government has planned to keep a lid on the debt servicing bill till Rs7.3 trillion but the IMF has forecast that it may balloon up to Rs8.3 trillion till the end of June 2024.

The primary surplus means that the deficit would be calculated by excluding debt servicing in the shape of principal and mark-up amounts requirement on domestic and foreign loans.

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Irfan Siddiqui meets with the PM and informs him about the Senate performance of the parliamentary party.

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The head of the Senate’s Foreign Affairs Standing Committee and the PML-N’s parliamentary leader paid Prime Minister Muhammad Shehbaz Sharif a visit in Islamabad.

Senator Irfan Siddiqui gave the Prime Minister an update on the Parliamentary Party’s Senate performance.

Additionally, Senator Irfan Siddiqui gave the Prime Minister an update on the Senate Standing Committee on Foreign Affairs’ performance.

He complimented the Prime Minister on his outstanding efforts to bring Pakistan’s economy back on track and meet its economic objectives.

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Business

SIFC Increases Direct Foreign Investment: Investment in the Energy Sector Rises by 120%

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The Special Investment Facilitation Council is intended to help Pakistan’s energy sector attract $585.6 million in direct foreign investment in 2024–2025. The amount invested at the same time previous year was $266.3 million.

This is a notable 120% rise, mostly due to investments in gas exploration, oil, and power. Such expansion indicates heightened investor confidence and emphasizes the development potential in important areas.

The State Bank reports that foreign investment in other vital industries has increased by 48% to $771 million.

This advancement is a blatant testament to SIFC’s efficient investment procedure and quick project execution.

The purpose of the Special Investment Facilitation Council is to establish Pakistan as an investment hub by aggressively promoting regional trade and investment in the energy sector and other critical industries.

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Business

Discos report losses of Rs239 billion.

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When compared to the same period last year, the data indicates that discos have decreased their losses in the first quarter of the current fiscal year.

The distribution businesses recorded losses of Rs239 billion in the first three months of the current fiscal year, a substantial decrease from the Rs308 billion losses sustained during the same period the previous year.

Additionally, the distribution businesses’ rate of recovery has improved. It has increased to 91% in the first quarter of this year from 84% in the same period last year, indicating success in revenue collection.

Regarding circular debt, the Power division observed a notable change. Last year, between July and October, the circular debt grew by Rs301 billion. Nonetheless, this year’s first four months saw a relatively modest increase in circular debt, totaling about Rs11 billion.

These enhancements show promising developments in the electricity sector’s financial health in Pakistan, where initiatives are being made to accelerate recovery rates and slow the expansion of circular debt.

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