The PTI against the opposition. The PTI against the establishment. PTI v. Pakistan Election Commission. The PTI vs. Biden. The PTI against China. The PTI against the IMF. The PTI against the media. Who said, “Friends can come and go, but enemies pile up?”
Asad Umar as Minister of Finance for eight months. Dr Hafeez Shaikh as an advisor for 20 months. Dr Hafeez Shaikh as Minister for three months. Hammad Azhar as minister for a month. Shaukat Tarin as Minister for six months. A country of 220 million inhabitants without a finance minister for a while. Shaukat Tarin as an advisor. Can this land uncertainty be conducive to the development of economic policies?
Four finance ministers in 39 months; average duration of 10 months. Eight FBR presidents – average term of five months. Four chairmen of the Board of Investment – average tenure of 10 months. Seven inspectors general of the Punjab police – average tenure of six months. Political uncertainty has a great impact on actual economic decision making.
Economic uncertainty “means that the future outlook for the economy is unpredictable.” Uncertainty is the biggest enemy of investing. Uncertainty is the biggest enemy of economic growth. Uncertainty keeps business owners from hiring. Uncertainty keeps business owners from increasing inventory. Uncertainty as to who will actually buy their products. Uncertainty keeps people from spending on big ticket items. Uncertainty makes people cautious about their consumption patterns. Uncertainty about future employment prospects. Uncertainty about individual income.
Uncertainty about the value of individual savings. Uncertainty also means savage volatility in stock prices.
Vladimir Lenin, the great Russian political theorist, said: “Politics is a concentrated expression of economics. Political uncertainty “leads to an increase in the risk premium of equities”. If and when “political uncertainty intensifies, investors demand a higher return on investment to compensate for the additional risk taking.” Businesses need “stable cash flow”. Companies suspend or postpone their investment plans in times of high political uncertainty.
There are many uncertainties in Pakistan – and on top of that, there is a global energy crisis. Yes, “the world is in the throes of an energy crisis – fierce pressure on some of the key markets for natural gas, oil and other fuels that keep the global economy running and lighting and heating people. houses”. Yes, “power shortages are turning off street lights and shutting down factories in China. The poor in Brazil choose between paying for food or electricity. German corn and wheat farmers cannot find fertilizer… and fears are growing that Europe will have to ration electricity if the winter is cold.
Brent crude went from $ 37 a barrel a year ago to $ 85 a barrel. Coal from $ 60 per tonne to $ 250 per tonne. In August, Pakistan State Oil (PSO) set a new record when it bought a shipment of LNG at $ 20 per unit, “the highest on record not only in the country, but perhaps the second summer purchase on highest in the world ”.
There is a thousand foot tsunami coming towards us with a million tons of rocks. We need to listen to emergency alerts. We must reach the heights. Our trade deficit is expected to reach a colossal $ 40 billion. Repayment of the foreign debt 14 billion dollars. Repayment of the domestic debt 2.7 trillion rupees. We need two things to weather the storm: political consensus and economic certainty.
The writer is an Islamabad-based columnist.
E-mail: [email protected] Twitter: @saleemfarrukh