Pakistan finance minister steps down amid IMF talks, budget preparations

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Speculation has been rife in recent days that Umar would be replaced, mostly over delays in reaching a bailout deal with the International Monetary Fund at a time of worsening economic outlook for the South Asian nation of 208 million people. (AFP/File)
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Asad Umar and with Imran Khan at PTI Workers Convention in 2017 – (Asad Umar Facebook)
Updated 18 April 2019

Pakistan finance minister steps down amid IMF talks, budget preparations

  • Asad Umar says was offered energy ministry by prime minister in cabinet reshuffle but declined
  • Warns no one should expect miracles from the new finance minister

ISLAMABAD: Pakistan’s Finance Minister Asad Umar resigned from the cabinet on Thursday after Prime Minister Imran Khan tried to move him to the energy portfolio, heightening uncertainty about ongoing bailout talks with the International Monetary Fund and the government’s plan to deal with an economy in crisis.
Speculation has been rife in recent days that Umar would be replaced, mostly over delays in reaching a deal with the IMF at a time of worsening economic outlook for the South Asian nation of 208 million people.
“As part of a cabinet reshuffle PM [prime minister] desired that I take the energy minister portfolio instead of finance,” Umar said in a Twitter post. “However, I have obtained his consent to not take any cabinet position.”
At a press conference later in the day, he said Khan needed to pick a new finance minister “as soon as possible” but declined to comment on who would replace him.
Umar’s successor will have the monumental task of not just finalizing the IMF deal but also the national budget, due to be announced in May.
“We are at an advanced stage [of talks] with the IMF and this will also reflect in the upcoming budget,” Umar said. “Whoever comes in, he will have to face a thorny situation … Nobody should expect any miracle from the new finance minister.”
As part of a cabinet reshuffle, Umar said other changes in the cabinet would “be announced either tonight or tomorrow morning.”
Khurram Hussain, the business editor of Dawn newspaper, said Umar’s resignation was “ill-timed” and would add to uncertainty about the country’s economic future.
“At a time when the finance minister was engaged with the IMF and preparing the budget, his resignation is beyond comprehension,” Hussain told Arab News, adding that any new official would now have to start from scratch.
Dr. Athar Ahmed, a senior economist based in Karachi, said Umar’s resignation would shake the confidence of the IMF in Pakistan and possibly prolong the finalization of a deal.
Talks with the IMF began soon after Khan was appointed prime minister but stalled over austerity conditions imposed by the Fund, which has pressed Pakistan to improve tax revenue collection, bolster foreign currency reserves and narrow a current account deficit expected to top 5 percent of gross domestic product this year.
Pakistani officials say they agree on the need for reforms but do not want to sign up to conditions that would derail the economy, with growth set to slow this year to around 4 percent from 5.2 percent last year.
“We have finalized the IMF agreement on much better terms than before as I refused to take decisions that would have crushed the nation,” Umar said at Thursday’s press talk.


Pakistan ‘wants to play its role’ for peace in Middle East – FO

Updated 12 January 2020

Pakistan ‘wants to play its role’ for peace in Middle East – FO

  • Work on foreign minister’s visit to Saudi Arabia, Iran and the United States being done
  • Pakistan’s strong relations with regional countries has made it an important player

ISLAMABAD: Pakistan Ministry of Foreign Affairs reiterated on Thursday that the country was going to play its role in restoring peace in the Middle East by working with other international stakeholders in the region.

“Pakistan welcomes de-escalation and wants to play its role in ensuring peace and stability in the region. We have seen that indication in United States President [Donald] Trump’s speech and are evaluating its contours,” the country’s foreign office spokesperson, Aisha Farooqui, said in her weekly media briefing in Islamabad on Thursday.

She said that Pakistan’s geographical position, along with its strong relations with regional countries and the United States, had made it a significant player in the Middle East.

“Pakistan has maintained that war is not the solution to any issue and made it clear that it will not become part of any regional conflict,” she said.

The spokesperson noted that Islamabad had enhanced its efforts to defuse tensions in the region and Foreign Minister Shah Mahmood Qureshi had contacted his counterparts in Iran, Saudi Arabia, the United Arab Emirates, Turkey and many other important states in this connection.

“All the international players, including Saudi Arabia, have said that the region cannot afford another war and asked for restraint from both parties [the US and Iran]. It’s a collective objective of all countries to ensure peace and stability in the Middle East,” she said.

Commenting on the foreign minister’s upcoming visit to Iran, Saudi Arabia, and the US, she said that “work on these tours has already started and they will take place as soon as dates are finalized with the respective countries.”

“We are very mindful for our brotherly and friendly relations with Saudi Arabia, Iran, and other regional countries. Pakistan and the US also enjoy longstanding relations and have contacts with each other through multiple forums including political and military leadership,” Farooqui said, adding that the foreign office had established a task force to continuously monitor the situation in the Middle East and inform the government about it along with its suggestions on a daily basis.

The spokesperson expressed hope that recent developments in the Middle East would not affect the ongoing Afghan peace process.

“Pakistan hopes that progress made on Afghan peace process will not come to a halt and the world community will not lose its focus as a result of the ongoing tensions in the Middle East,” she said.

Asked about the safety of Pakistani nationals in Iraq, she said the country’s embassy in Baghdad was on the alert to deal with any emergency situation.

“We are concerned about the safety of Pakistani citizens in Iraq and have issued an advisory in this regard. We have also instructed our mission in Baghdad to remain vigilant to deal with any emergency,” Farooqui said.