inflows in coming days
Governor Stat Bank
of Pakistan (SBP) Jameel Ahmad on Wednesday expressed optimism
that Pakistan’s foreign exchange reserves position will improve as the country is
expected to witness inflows of funds in the coming days.
“We are expecting inflows from next week onwards, which would reduce
pressure on our /foreign exchange reserves,” the SBP governor said in his address at the Federation of Pakistan
Chambers of Commerce and Industry (FPCCI) in Karachi.
Ahmad expressed his commitment to addressing the issues of industrialists and
said the FX reserves of the country have depleted to a low level. “
However, we will see a surge in reserves as projects in the pipeline will soon start
to materialize, which will improve our capacity to facilitate businesses,” he said.
As per latest SBP data, foreign exchange reserves held by the central bank fell by a hefty
$1.23 billion to a highly critical level of $4.34 billion. This is the lowest level of SBP’s reserves since February 2014.
Total liquid foreign reserves held by the country stood at $10.19 billion, and net foreign
reserves held by commercial stood at $5.85 billion.
The low level of reserves
was the reason behind the SBP placing restrictions
on imports earlier this year, much to the dismay of several importers and businesses
in Pakistan that cited these curbs as the reason behind shutting down or scaling back operations.
Ahmad said the SBP facilitated shipments under the categories of essential, energy, export
-oriented industries, agriculture inputs, deferred payment / self-funded imports and imports for export
-oriented projects near completion.
Earlier, the central bank had decided to withdraw restrictions placed on imports with effect from January 2, 2023,
Summing up one of Pakistan’s worst economic
“Our capacity to export will build up only after we complete export-oriented projects,
thus we have facilitated the timely completion of these projects,” he s.
“We are focusing on improving also taking administrative intervention to bring our imports on a reasonable level,” he added.
The SBP chief said
evaluating the Letter of Credit (LC) is a time-consuming exercise. “We have cleared 33,000 LC cases,” he said.
He also said that the central bank was aware of business community problems, and
measures were taken to control the current account deficit.
The governor said that the SBP will carefully evaluate proposals provided by the
business community, and soon launch an action plan in this regard.
He assured the business community that the central bank will ensure the approval of 365-day or over LCs from banks. “Similarly, if you have arranged a project loan, and yet the LCs are not
being opened, the SBP will ensure it,” he said.
Days ago, in order to encourage IT companies and freelancers to bring their
foreign exchange earnings into the country, the SBP had advised banks to mandatorily allow the
retention of 35% of their export proceeds in special foreign currency accounts.