Karachi, In a significant boost to Pakistan’s economic reforms, the World Bank’s Board of Executive Directors has approved a $350 million financing package for the Second Resilient Institutions for Sustainable Economy (RISEII) Operation. This initiative is aimed at strengthening Pakistan’s fiscal management and enhancing its competitiveness to foster sustained and inclusive economic growth.
According to The World Bank, the RISEII operation is a critical step towards addressing Pakistan’s need for urgent fiscal and structural reforms. Najy Benhassine, the World Bank Country Director for Pakistan, emphasized the necessity of these reforms in restoring macroeconomic balance and establishing the foundation for sustainable growth. The operation completes the first phase of tax, energy, and business climate reforms intended to increase revenues, improve expenditure targeting, and stimulate competition and investment.
The RISEII operation is set to contribute to improved fiscal management through several key measures. These include enhancing fiscal policy coordination, increasing debt transparency and management, strengthening property taxation, and improving the financial viability of the power sector. Additionally, the operation aims to foster growth and competitiveness by reducing tax compliance costs, improving financial sector transparency, encouraging digital payments, and promoting exports through lower import tariffs.
Derek H. C. Chen, the Task Team Leader of the operation, highlighted the significance of this initiative. He stated that based on the foundations established by RISEII and parallel support from other International Financial Institutions (IFIs), Pakistan has a unique opportunity to address longstanding structural issues in its economy. Chen warned that failing to capitalize on this opportunity could result in the country reverting to unstable economic cycles.
The approval of this substantial financing from the World Bank signifies a pivotal moment for Pakistan as it gears up for the upcoming general elections and the subsequent economic challenges. The RISEII operation represents a crucial step in Pakistan’s journey towards economic stability and growth.