Pakistan’s Finance Minister Asad Umar resigned after Prime Minister Imran Khan attempted to move him to the energy portfolio as the country continues to negotiate an International Monetary Fund bailout.
“As part of a cabinet reshuffle PM desired that I take the energy minister portfolio instead of finance. However, I have obtained his consent to not take any cabinet position,” Umar said Thursday on Twitter.
Umar’s decision comes as he led negotiations for what would be Pakistan’s 13th IMF support program since the late 1980s. Since his appointment after Khan’s election victory last year, the former chief executive officer of Pakistani conglomerate Engro Corp. has been subjected to a campaign of negative media coverage from unnamed government sources. That has fueled prolonged speculation that he would be moved from the finance ministry as the economy continued to falter.
At least two Pakistani local newspaper columnists recently said Umar had displeased the powerful military, which is alleged to have backed Khan during the elections and continues to hold an over-sized influence over the economy and foreign policy. Pakistan’s credit score was also downgraded by S&P Global Ratings last month, citing deterioration in the economic outlook and delay in securing an IMF program.
“In the eight months, there were some decisions that gave good results and some that didn’t,” Umar said in a press conference in Islamabad flanked by empty chairs. “I request that whoever becomes the new finance minister and makes difficult decisions, support them and don’t think everything will be fixed within three months.”
Discussions with the IMF have twice stalled over various disagreements, such as exchange rate policy. Yet an agreement seemed closer recently and Umar was in Washington for talks with the lender last week, ahead of an IMF delegation visit to Islamabad at the end of April. A deal is now likely to be delayed again.
IMF Delay
“It will most likely get prolonged as the new finance minister will take time to understand, grasp things,” said Vaqar Ahmed, the executive director at the Sustainable Development Policy Institute in Islamabad.
Since coming to power in August, Khan’s government has faced a balance-of-payments crisis and a depleted treasury that has thwarted the former cricket legend’s plans to expand social welfare support across the South Asian nation.
However, Islamabad secured a temporary reprieve thanks to loans and funding from friendly countries, such as Saudi Arabia and the United Arab Emirates.
Beyond the immediate crisis, Umar was charged with fixing Pakistan’s decades-long boom-and-bust cycles, thanks to an over-reliance on debt-funding in a country where less than 1 percent of its more than 200 million people file tax returns.
Nevertheless, economists and industrialists have continually complained about a lack of clarity over the government’s plans to solve those endemic economic issues.
“The incumbent leadership’s indecisive nature has made Pakistan rudderless on the economic front,” said Ali Wahab, head of debt capital markets at Sharjah Islamic Bank.
https://www.bloomberg.com/news/arti...nister-steps-down-from-cabinet-amid-imf-talks
“As part of a cabinet reshuffle PM desired that I take the energy minister portfolio instead of finance. However, I have obtained his consent to not take any cabinet position,” Umar said Thursday on Twitter.
Umar’s decision comes as he led negotiations for what would be Pakistan’s 13th IMF support program since the late 1980s. Since his appointment after Khan’s election victory last year, the former chief executive officer of Pakistani conglomerate Engro Corp. has been subjected to a campaign of negative media coverage from unnamed government sources. That has fueled prolonged speculation that he would be moved from the finance ministry as the economy continued to falter.
At least two Pakistani local newspaper columnists recently said Umar had displeased the powerful military, which is alleged to have backed Khan during the elections and continues to hold an over-sized influence over the economy and foreign policy. Pakistan’s credit score was also downgraded by S&P Global Ratings last month, citing deterioration in the economic outlook and delay in securing an IMF program.
“In the eight months, there were some decisions that gave good results and some that didn’t,” Umar said in a press conference in Islamabad flanked by empty chairs. “I request that whoever becomes the new finance minister and makes difficult decisions, support them and don’t think everything will be fixed within three months.”
Discussions with the IMF have twice stalled over various disagreements, such as exchange rate policy. Yet an agreement seemed closer recently and Umar was in Washington for talks with the lender last week, ahead of an IMF delegation visit to Islamabad at the end of April. A deal is now likely to be delayed again.
IMF Delay
“It will most likely get prolonged as the new finance minister will take time to understand, grasp things,” said Vaqar Ahmed, the executive director at the Sustainable Development Policy Institute in Islamabad.
Since coming to power in August, Khan’s government has faced a balance-of-payments crisis and a depleted treasury that has thwarted the former cricket legend’s plans to expand social welfare support across the South Asian nation.
However, Islamabad secured a temporary reprieve thanks to loans and funding from friendly countries, such as Saudi Arabia and the United Arab Emirates.
Beyond the immediate crisis, Umar was charged with fixing Pakistan’s decades-long boom-and-bust cycles, thanks to an over-reliance on debt-funding in a country where less than 1 percent of its more than 200 million people file tax returns.
Nevertheless, economists and industrialists have continually complained about a lack of clarity over the government’s plans to solve those endemic economic issues.
“The incumbent leadership’s indecisive nature has made Pakistan rudderless on the economic front,” said Ali Wahab, head of debt capital markets at Sharjah Islamic Bank.
https://www.bloomberg.com/news/arti...nister-steps-down-from-cabinet-amid-imf-talks
