ISLAMABAD: Pakistan’s finance ministry on Saturday said the country’s macroeconomic imbalances were likely to jeopardize its growth rate of about 6 percent next year, reported the local media.

The country is facing a major current account deficit against the backdrop of depleting foreign exchange reserves, weakening currency and soaring inflation.

The government is trying to secure a staff-level agreement with the International Monetary Fund (IMF) for the resumption of a $6 billion bailout package.

It has also raised fuel prices substantially since the international lending agency wanted it to reverse subsidies given to oil and power sectors, though the decision is expected to further raise prices of basic commodities.

“Pakistan is currently facing several severe challenges: Accelerating inflation, high external deficits, exchange rate depreciation, declining foreign exchange reserves, and mounting uncertainty,” the ministry said in a monthly report mentioned in The News International.

“On the other hand, economic growth remains relatively high, but in the presence of macroeconomic imbalances this may not be sustainable,” it added.

The ministry maintained the persistent growth of more than 5.50 percent for two consecutive years had laid the foundation of inclusive growth, though it emphasized the need to address the macroeconomic challenges to make it more sustainable.

It also highlighted the importance of a credible economic trajectory, saying investors took decisions that were based “on expectations about the future economic path as well as on the degree of certainty/confidence of development prospects.”

The ministry mentioned the negative impact of the Russia-Ukraine war, saying it had caused major disruptions to the supply of commodities around the world.

“Pakistan has also been affected, as the country is a net importer of food items especially wheat, pulses and edible oil,” it continued. “The impact of global price movement is realized in domestic prices.”