Study in pros, cons of liberal exchange rate regime demanded
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Flight of capital gaining additional momentum
The Pakistan Economy Watch (PEW) on Monday demanded a study to look into pros and cons of the liberalisation of exchange rate regime.
It also demanded a sturdy to know the advantages and disadvantages of linking economy to the international market which left economy exposed to the impact of crisis in the western world.
The 1990’s policy gave everyone access to operate foreign currency accounts, many exchange companies came into existence and it gave an opportunity to the speculators, said Dr. Murtaza Mughal, President PEW.
He said that a former governor of the State Bank once said that 25 million dollars are being sent abroad on daily basis but it wasn’t enough to grab attention of the policymakers which triggered dollarization of the economy.
Dr. Murtaza Mughal said that flight of capital has reached to an extent that government has to remain in a state of panic to keep exchange rate stable.
Pakistanis are said to be stashed 200 billion dollars in foreign banks while around six billion dollars were spent during last two years for buying homes and apartments in Dubai, Malaysia and other countries.
This amount was fifty percent more than what we got from IMF in last two years on harsh conditions which left man on the street and economy in bad shape, he said.
Dr. Murtaza Mughal said that poor and middle-class expatriates have saved Pakistan from default by sending billion home while elite continue to send billions abroad.
He said that despite this service, the expats doesn’t get any benefit while the nobility damaging Pakistan through flight of capital gets every relaxation which is astounding.
