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Pakistan swaps 6 finance ministers in 4 years to stem crisis


ISLAMABAD: Pakistan Appointed Ishaq Dar as finance minister to pull the country out of a worse economic crisis caused by a rapidly depreciating currency and high inflation.
Dar, the sixth chief financial officer since August 2018, took office after the South Asian nation issued an urgent call for debt relief from wealthy nations amid catastrophic flooding caused by climate change. More and more severe consequences affect the already fragile economy.
Pakistan has secured a $1.1 billion loan from International Monetary Fund in August to prevent an impending default, but the deadly flood claimed lives and livelihoods and resulted in approximately $30 billion in damages.
Dar, a professional accountant, will lead the office for the fourth time and replace Miftah Ismail. He will be tasked with reversing the country’s current difficult economic situation amid challenges such as low growth, high inflation and three-month low-than-imported foreign exchange reserves. The South Asian country is also scheduled to repay $1 billion in government bonds by December.
Pakistan’s gross domestic product is estimated to have halved from 5% in the financial year ending June following the floods. Its central bank has also raised interest rates by 525 basis points so far this year to rein in prices that have risen for six straight months and hit a 47-year high of 27.3% in August.
“My goal will be to break the contraction of the economy and change its direction,” Dar said Monday before taking office.
His appointment is stoking hopes of a reversal in what has been among the worst performers against the US dollar globally this month. During his last stint as chief financial officer, Dar managed to keep the rupee the most stable currency in Asia from 2014 to 2017, according to data compiled by Bloomberg. The rupee has gained 3.4% since he was nominated for the position.
Dar has repeatedly said that the currency is undervalued and speculators will not be allowed to determine its value against the US dollar.
Dar, a close aide of the former Prime Minister Nawaz Sharifwill also face a difficult political environment to comply with some key IMF regulations amid calls for new elections and growing public anger over flooding and the reversal of loans. Energy subsidies raise prices.





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