PRIME'S Charter of economy: a blueprint for Prosperous economic future of pakistan
Introduction
In the past, prime ministers and Federal cabinet
members under threat of losing popularity
mobilize public resources and manipulate
economic resources using policy tools. Pre election populist spending stimulates consumer
demand, and disproportionately increases
import spending, throwing the current account
balance into unsustainable deficit levels.
Because the highest import spending of the
country is made on petroleum imports, and the
government has a near monopoly on these
imports, the government runs out of dollars to
continue import purchases.
Broad scale controls are activated in favor of
slowing down international trade. When imports
are choked out, it stresses that portion of the
export sector which is in the business of
processing imported goods or finishing imported
raw materials.
All this occurs in the hope that multilateral
financing institutions come to the rescue.
Inevitably, the result is expensive petroleum,
higher taxes, higher inflation, and shortages of
essentials. This throws off existing economic
relationships between private players
influencing the viability of exchanges in
unpredictable ways.
Additionally, political parties have been involved
in blocking off civic infrastructure, and greatly
affecting the lives and businesses of private
citizens. Economic players cannot function
optimally when access to economic capital
frequently become unavailable.
In 2006, Mohtarma Benazir Bhutto and Mian
Muhammad Nawaz Sharif signed the charter of
democracy. This landmark pre-constitutional
agreement between the two largest political
parties of Pakistan serves as the foundation
upon which parliamentary continuity in Pakistan
has been sustained since 2008. With the goal of
blocking undemocratic power upheavals in the
political establishment, the arrangement
became the basis of several constitutional
amendments.
We have heard from players of almost all the
political parties calling for a similar Charter of
Economy. The stated goal of such a charter may
be surmised as the elimination of political
interests in the deployment of economic
controls, and in the distribution of public
finances.
Such a charter would have the effect of delinking
public finances from the state economy in a
meaningful way. It would be able to cultivate
budgetary discipline, conservative fiscal policy,
stable monetary policy and improve cross border
trade prospects. In pursuit of a stable economic future for Pakistan, the policy research institute of market economy is currently engaging with top legal and public finance expert Dr Ikramul Haq to draft a technical agreement known as the Charter of Economy. Alongside this effort, PRIME is actively supplementing the charter with a consensus-building exercise between political stakeholders, directly reaching out to the Central Executive Committees of the top three political parties represented in Parliament: PTI, PPP, and PMLN. Through various outreach activities, such as meetings with politicians, newspaper articles, and social media messaging, PRIME is building political capital around the issue, positioning the Charter of Economy as a critical public interest matter for the welfare of all Pakistanis.
