ISLAMABAD - World Bank has noted that surge in global energy and commodity prices is hitting Pakistan hard.

Hartwig Schafer, Vice President South Asia Region (SAR), World Bank, has said that it is committed to support Pakistan. “Time to stay course and accelerate reforms” he said on Twitter after meeting Pakistan’s economic team led by Finance Minister Miftah Ismail. Both sides have discussed implementation of key economic & structural reforms including fiscal, debt management and critical power sector reforms.

Vice President South Asia Region (SAR), World Bank has also held meeting with Minister of Energy, Power Division Khurram Dastgir Khan & Secretary Power Rashid Mehmood on the critical power sector reform programme, including reducing generation costs, decarbonizing the energy mix better targeting subsidies, & reducing circular debt. He said these reforms will put the sector on financially viable footing and country on greener development path, as World Bank is committed to continue support Pakistan in this strategic sector, including through investments in renewables (hydro, solar), transmission, distribution &energy efficiency.

Hartwig Schafer concluded a two-day visit to Pakistan, emphasizing the need to sustain structural reforms and mainstream climate in development planning as the Bank continues to support the country’s recovery from COVID-19.

Schafer met with Prime Minister Shehbaz Sharif to discuss the government’s top development priorities. He conveyed the World Bank’s commitment to support the new government’s ambition to stabilize the economy and accelerate structural reforms for stronger and more sustainable growth.

Schafer also met with Miftah Ismail, Federal Minister for Finance and Revenue, Ayaz Sadiq, Federal Minister for Economic Affairs, Professor Ahsan Iqbal, Federal Minister for Planning, Development and Special Initiatives, and Khurram Dastgir, Federal Minister for Energy (Power Division). In his meetings, he emphasized key economic and fiscal reforms as well as power sector reforms, including reducing power generation costs, decarbonizing the energy mix, better targeting subsidies, and reducing circular debt to help Pakistan accelerate recovery from the pandemic, better cope with the ongoing global price shocks and achieve higher economic growth.

“I encouraged the new government to stay the course on key structural reforms to improve power sector performance and on economic reforms including revenue mobilization, fiscal consolidation, and debt management,” said Hartwig Schafer. “Maintaining the momentum and accelerating the pace of these reforms will be critical for Pakistan’s green, resilient, and inclusive development.”

In his meetings, Schafer was accompanied by the World Bank’s Country Director for Pakistan, Najy Benhassine and International Finance Corporation’s new Country Manager for Pakistan and Afghanistan, Zeeshan Sheikh.

Meanwhile, according to the Ministry of Finance, Federal Minster for Finance and Revenue Miftah Ismail, held a meeting with Hartwig Schafer, Vice President South Asia Region (SAR), World Bank.

The finance minister welcomed Hartwig Schafer and shared that country is currently facing monetary and fiscal challenges due to rising global commodity prices. The present government is cognizant of these issues and is taking pragmatic steps to resolve bottlenecks to growth. The present government is committed to set the economy on sustainable and inclusive growth path.

| Hartwig Schafer says World Bank committed to support Pakistan, World Bank VP meets Pakistan’s economic team led by finance minister

Miftah says country is facing monetary and fiscal challenges due to rising global commodity prices

Finance Minister Miftah Ismail shared that upcoming budget aims at bringing in the fiscal consolidation and improving the overall resilience of the economy. For this reason, government is planning to provide various relief measures for protecting the vulnerable segments of the society. The finance minister further stated that present government will introduce reforms in priority areas to address fiscal deficits. In this context, two programs of World Bank named Resilient Institution for Sustainable Economy (RISE-II) and Program for Affordable and Clean Energy (PACE-II) hold a central position in the reform agenda of government.

Hartwig Schafer shared his insights about the reforms initiatives proposed by the World Bank. These programs not only ensure sustainable growth but also work as effective shock absorbers in case of any economic crisis. He appreciated the resolve of the Government of Pakistan in overcoming the economic challenges.

Key areas discussed in the meeting included macro-economic situation of the country, fiscal responsibility and debt limitation laws, and financial sustainability of the power sector.

The finance minister thanked the VP, World Bank and acknowledged the significant contribution of the World Bank in the socioeconomic development of country. The finance minister also emphasized that the World Bank’s continued support will be critical to reforms being pursued by the government of Pakistan.

Hartwig Schafer assured his full support to Govt of Pakistan in implementation of the government’s reform agenda and the projects funded by the World Bank. Minister of State for Finance and Revenue Dr Aisha Ghous Pasha, Country Director WB Najy Benhassine, acting Governor SBP Dr. Murtaza Syed, Secretary Finance, Secretary Power Division, Secretary EAD, chairman FBR and other senior officers attended the meeting.