(January 29, 2020)
President Pakistan Businessmen and Intellectuals Forum (PBIF), President All Karachi Industrial Alliance (AKIA), Senior Vice Chairman of the Businessmen Panel of FPCCI and former provincial minister, Mian Zahid Hussain on Wednesday said the central bank has disappointed the business community by keeping interest rates unchanged.
Political instability, double-digit inflation, double-digit interest rates, rising prices of energy and increasing tax burden is eroding the confidence of the business community, he said.
Talking to the business community, the veteran business leader said that the SBP should have realized that high interest rate has made it impossible to conduct business as it is only benefitting businesses. The profit of banks is soaring beyond reasonable limits amid economic slowdown which is not good for the economy, he said.
The former minister noted that the deal with the IMF has not improved the situation as expected, all major targets could not be achieved and the economic infrastructure seems to be in a shamble.
The inflation has taken a toll on the masses as well as the economy while per capita income has reduced substantially while only good news is a reduction in the current account deficit, he noted.
He said that the current account deficit was not reduced by increasing exports but by decreasing imports which reduced it by almost four billion dollars but resulted in massive closures of businesses, unemployment and contraction of GDP by almost forty billion dollars.
He said that the majority of the traders and industrialists think that the economy can be turned around but it will require cooperation of the government which will make the current year better than painful 2019.
Business community holds an opinion that the monetary policy has failed to tame inflation and that the economic slowdown will continue to haunt the country if their reservations were ignored.
Mian Zahid said that the government has planned to provide hefty funds to politicians which will add to inflation. These funds should be used to trigger growth, he demanded.