Pakistan finance chief wants nation to live within its means

-Bloomberg Pakistan’s finance minister wants to break a boom-and-bust cycle that’s played out for decades, and help the nation to finally learn to live within its means.Import payments should equal dollar inflows, which means curbs on luxury items may remain in place for longer than currently anticipated, Miftah Ismail said in an interview at his home in Karachi on Saturday.

“I want to see a Pakistan that lives within its means. That’s it,” Ismail, 57, told Bloomberg News. “Nothing can happen in one year, but we can start.”

The outlook has been further complicated in the aftermath of historic floods, which could have an economic impact of at least $10 billion, adding to a list of problems for Ismail that includes political turmoil and raging inflation.

Less than a week ago the International Monetary Fund gave Pakistan a $1.16 billion lifeline to avoid imminent default. Pakistan also secured pledges for a total of $9 billion in investments and loans from Qatar, Saudi Arabia, and the UAE. Ismail said he expects a $1 billion investment in listed state-owned companies to materialize in about a month.

Since taking up his post in April, the Wharton graduate and former IMF economist has made efforts to narrow Pakistan’s yawning trade gap and current account deficit a priority.Ismail expects economic growth of more than 3.5% for the fiscal year that started in July, down from an initial target of 5%. He predicts that inflation, running at the highest in 47 years and the second highest in Asia, is close to its peak and will average 15% for the year.