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Caretaker Finance Minister Emphasizes the Importance of Export Enhancement for Sustainable Growth

Caretaker Finance Minister Dr Shamshad Akhtar has highlighted the crucial role of exports in achieving sustainable growth for Pakistan. Speaking at the inauguration of The Export-Import Bank of Pakistan (EXIM Bank), Dr Shamshad emphasized the need for innovation and diversification in the country’s economy to ensure balance of payment sustainability.

According to Dr Shamshad, enhancing exports is the key to sustainable growth for Pakistan. She stressed the importance of removing anti-export bias and urged the industry to focus on competitive principles and transition from low technology to high technology.

To reduce excessive dependence on the textile sector, Dr Shamshad emphasized the need for diversification in export markets. She pointed out that more than 50% of Pakistan’s exports rely on just four markets – USA, EU, China, and Afghanistan. Dr Shamshad expressed hope that EXIM Bank would play a vital role in diversifying the market for Pakistani exporters and facilitating access to new markets.

Dr Shamshad also highlighted the importance of credit guarantees and insurance products for exporters, stating that these measures would encourage them to target new markets and products. She emphasized the need to move away from industrial and export subsidies and focus on effective management and policy frameworks to enhance export competitiveness.

The launch of EXIM Bank marks a significant milestone for Pakistan, as it is the country’s first-ever EXIM institution. Dr Shamshad believes that the bank, along with streamlined export policy frameworks, has the potential to contribute to the balance of payment sustainability and enhance the competitiveness of Pakistani exporters in international markets.

EXIM Bank aims to offer lending, credit insurance, and guarantee services to exporters. It will create a level-playing field for Pakistani exports, enable access to global markets, diversify product portfolios, and protect exporters against the risk of credit default.

As a public-private partnership, EXIM Bank will function as a single-window operation for exporters, offering a comprehensive range of products, incentives, and services. Dr Shamshad emphasized the importance of adapting international best practices and attracting contingent risk capacity from international private sector reinsurance companies and other EXIMs and ECAs globally.

The Export-Import Bank of Pakistan Act 2021 was enacted in October 2022, and EXIM Bank was officially notified as a financial institution in February 2023. With its operationalization, EXIM Bank is expected to play a crucial role in expanding and diversifying Pakistan’s export base while mitigating the risks faced by local businesses in international trade.

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