During the 2024 Annual Meetings of the IMF and World Bank in Washington, D.C., Pakistan’s State Bank Governor, Mr. Jameel Ahmad, met with key global investors and international rating agencies to present Pakistan’s strengthened economic position and optimistic future outlook. The events, hosted by major financial institutions like Standard Chartered, JP Morgan, Bank of America, and Jefferies, allowed the Governor to discuss recent economic achievements and strategic policies driving Pakistan’s economic recovery.
Governor Ahmad outlined Pakistan’s improved economic indicators, crediting the progress to a series of prudent monetary policies by the State Bank of Pakistan (SBP) and the government’s commitment to fiscal consolidation. He acknowledged the broader global economic challenges impacting emerging markets, including Pakistan, while highlighting that difficult but essential policy actions have laid a strong foundation for the nation’s economic stability.
One of the core messages in Mr. Ahmad’s address was the progress in inflation control. He shared that Pakistan’s inflation rate had surged to 38% in May 2023 but had since followed a clear downward trend, dropping to 6.9% year-on-year in September 2024. This broad-based disinflation has extended to core inflation, which has also seen a significant decrease in recent months. According to Ahmad, the strategic approach to managing inflation has positively influenced household purchasing power and economic predictability.
Mr. Ahmad also highlighted Pakistan’s remarkable improvements in its external accounts. He explained that even with the rise in non-oil imports and the resumption of profit and dividend repatriations by foreign investors, the external current account deficit had decreased substantially. The current account balance improvement has primarily been driven by robust export growth and sustained remittances from overseas Pakistani workers. He remarked that the stabilization of the external account has enabled the SBP to rebuild its foreign exchange reserves, which have risen from a low of $3.1 billion in January 2023 to $11 billion as of October 11, 2024. Mr. Ahmad shared SBP’s target of further strengthening reserves to reach $13 billion by June 2025.
The Governor underscored that the SBP’s recent economic policy framework is part of a broader structural reform agenda designed to sustain and build on these economic gains. Supported by the new IMF program, this reform agenda aims to establish a foundation for long-term economic growth and financial stability. Mr. Ahmad described the SBP’s strategic plan for 2024-2028, which emphasizes three primary goals: maintaining price stability, increasing foreign exchange reserves, and fostering an inclusive digital financial ecosystem. These objectives align with the SBP’s vision to enhance the effectiveness, fairness, and resilience of Pakistan’s financial system while making financial services more accessible through digital innovation.
The Governor also detailed how these reforms align with SBP’s focus on establishing a modern and stable financial system. He described ongoing efforts to promote an inclusive digital financial services ecosystem, aimed at reaching underserved populations and integrating more Pakistanis into the formal financial system. By advancing digital financial services, the SBP seeks to facilitate faster, more efficient banking operations and broaden access to financial services for individuals and businesses alike.
In his closing remarks, Governor Ahmad reiterated the government’s dedication to a home-grown reform strategy that prioritizes fiscal discipline, price stability, and sustainable growth. He emphasized the importance of Pakistan’s partnerships with both multilateral institutions and bilateral allies, expressing optimism that these collaborations will bolster Pakistan’s progress in establishing a resilient and prosperous economy.
Governor Ahmad’s engagements at the IMF-World Bank meetings underscored Pakistan’s positive economic trajectory and the SBP’s commitment to maintaining this momentum through robust policies and strategic reforms.