World Bank Approves $700 Million to Bolster Pakistan’s Macroeconomic Stability
Islamabad: The World Bank has officially approved $700 million in funding for Pakistan as part of a multi-year initiative aimed at enhancing the nation’s macroeconomic stability and service delivery. This crucial investment comes amid ongoing efforts to elevate Pakistan’s economic standing.
Details of the Financing
– Program Overview: The funds will be disbursed under the World Bank’s Public Resources for Inclusive Development – Multiphase Programmatic Approach (PRID-MPA). This initiative has the potential to provide a total of up to $1.35 billion.
– Allocation Breakdown:
– $600 million designated for federal programs.
– $100 million allocated to support a provincial initiative in Sindh.
– Previous Support: This funding follows a $47.9 million grant from the World Bank in August aimed at improving primary education in Punjab, highlighting the ongoing commitment to critical sectors.
Statement from the World Bank
Bolormaa Amgaabazar, the World Bank’s Country Director for Pakistan, emphasized the need for Pakistan to mobilize domestic resources efficiently:
Pakistan’s path to inclusive, sustainable growth requires mobilizing more domestic resources and ensuring they are used efficiently and transparently to deliver results for people.
Goals of the Initiative
Tobias Akhtar Haque, the World Bank’s lead country economist, outlined the key objectives:
– Strengthening Pakistan’s fiscal foundations to restore macroeconomic stability.
– Supporting reforms that increase fiscal space.
– Fostering investments in human capital and climate resilience.
Haque stated, These reforms will ensure that resources reach the front line and deliver better outcomes for people across Pakistan with greater efficiency and accountability.
Focus on Inclusive Development
The federal component of the initiative aims to:
– Improve domestic revenue collection.
– Enhance budget planning and execution.
– Strengthen data systems for informed, evidence-based decision-making.
The program emphasizes increasing public resources for inclusive development, particularly through:
– More equitable and responsive financing for primary healthcare facilities.
– Enhanced funding for schools and educational initiatives.
Addressing Challenges
A recent IMF-World Bank report highlighted significant obstacles, noting that:
– Fragmented regulation, opaque budgeting, and political capture hinder investment and weaken revenue generation in Pakistan.
Conclusion
The World Bank’s approval of $700 million marks a significant step toward bolstering Pakistan’s macroeconomic stability. By focusing on inclusive development and strengthening fiscal policies, this initiative aims to create a more sustainable and transparent economic environment for the nation. With ongoing support, Pakistan can work toward a brighter, more stable economic future.