(March 29-2023)
Chairman of National Business Group Pakistan, President Pakistan Businessmen and Intellectuals Forum, and All Karachi Industrial Alliance, and former provincial minister Mian Zahid Hussain on Wednesday said due to the bankruptcy of the US the global financial system is under threat.
The possibility of bankruptcy of dozens of other banks will deal a serious blow to the global economy and the global growth rate may shrink further, he said.
Mian Zahid Hussain said that turmoil in the markets trade and industry can suffer in the majority of the countries.
Talking to the business community, the veteran business leader said that the crisis started with the interest rate hike in the US and has now also engulfed Europe.
In the current situation, the demand could further depress global growth as the collapse of Swiss bank Credit Suisse has shaken the foundations of the country’s financial stability.
He said that in the rapidly changing global financial situation, Pakistani policymakers have to be alert to deal with any emergency.
Mian Zahid Hussain said that global growth has shrunk to 3 percent due to the Ukraine war, financial constraints, uncertainty, and pandemic fears, while risks of economic instability are rising.
High levels of debt and rapidly rising interest rates are weakening the global financial system. Many countries, including Russia and China, are getting rid of the US dollar and adopting other means of trade, which is increasing anxiety in the markets, he added.
Now there is increasing global economic instability due to threats to the banking system in America and Europe which will have a negative impact on Pakistan’s economic recovery and our economy may suffer further as our coffers are already empty.
The business leader said that the Western countries are under pressure and on the other hand China’s economic recovery is supporting the global economy.
In the current situation, the economic decline continues in Pakistan. The growth rate has decreased by four percent, the value of the dollar is increasing and the value of the rupee is continuously depreciating. Inflation continues to rise, life has become hard for the people and political instability is halting businesses.
The government is trying to provide temporary relief to the people but lasting relief is not possible without economic, economic, and agricultural reforms and now Pakistan has to become self-sufficient as there is no other option.
