KARACHI: The World Bank’s Board of Executive Directors has approved $350 million in financing for Pakistan under an initiative to strengthen fiscal management and promote competitiveness for sustained and inclusive economic growth in the country, said its statement on Wednesday.
The Second Resilient Institutions for Sustainable Economy (RISE-II) Operation was launched in December 2022 and followed the first program in the series, RISE-I, which began two years before that.
Speaking at the occasion, a top World Bank official emphasized the need for Pakistan to carry out comprehensive reforms for improved economic progress.
“Pakistan needs urgent fiscal and structural reforms to restore macroeconomic balance and lay the foundations for sustainable growth,” Najy Benhassine, the bank’s country director for Pakistan, said. “RISE-II completes a first phase of tax, energy and business climate reforms geared to raising additional revenues, improve the targeting of expenditures and stimulate competition and investment.”
According to the World Bank statement, the RISE-II operation contributes to better fiscal management by improving fiscal policy coordination, enhancing debt transparency and management, strengthening the taxation of property and improving the financial viability of the power sector.
The operation also aims to foster growth and competitiveness by reducing the cost of tax compliance, improving financial sector transparency, encouraging the use of digital payments, and promoting exports by lowering import tariffs.
“Based on the foundations laid through RISE-II and parallel support by other IFIs [international financial institutions], Pakistan has the opportunity to tackle long-standing structural distortions in its economy after the upcoming general elections,” Derek H. C. Chen, task team leader of the operation, said. “Failing to use this opportunity would risk plunging the country back into stop and go economic cycles.”
Pakistan and the World Bank have had significant and multifaceted engagements spanning over decades, focusing on various development challenges and strategic priorities.
The bank has also launched a series of policy notes in recent years as part of its engagement and outreach program to contribute to the public dialogue on reforms needed for a brighter economic future for the country.