Economic Advisory Group Backs Tariff Reform and Rebuts Auto Industry Campaign
Economists argue that a full page advertisement opposing the National Tariff Policy 2025–30 is itself the strongest evidence that protection guarantees profit rather than competitiveness ISLAMABAD: The Economic Advisory Group (EAG) today issued a detailed rebuttal of a full page advertisement placed by the Pakistan Association of Automotive Parts & Accessories Manufacturers (PAAPAM) in a […]
EAG supports SBP’s cautious approach towards decreasing the policy rate
In the recent MPC meeting, the SBP decided to reduce the policy rate from 12% to 11%. This decision is motivated by a sharp decline in inflation, including a steady decline in core inflation. The Economic Advisory Group (EAG) agrees with the decision taken by the SBP to decrease the policy rate while continuing to […]
Tariff Reforms: A necessary first step, needs to be complemented with institutional reforms
The Economic Advisory Group (EAG) strongly supports the tariff reforms, which the government plans to implement over the coming years. According to some proposals under consideration, the simple average tariff rate, which includes regulatory duties and advanced customs duties, is expected to fall from close to 20% currently to less than 10% over the next […]
Need of the hour: A push for tariff liberalization in Pakistan
Islamabad, March 26 2025: Pakistan and the International Monetary Fund (IMF) have reached an agreement to significantly reduce the country’s average tariffs by 43% over the next five years. This decision aims to liberalize Pakistan’s economy and increase its exposure to international competition. EAG believes that this could foster much needed competitive pressure into the […]
Economic Advisory Group (EAG) supports the cautious stance of the SBP in maintaining the policy rate at 12 percent.
Islamabad, March 12, 2025 – The Monetary Policy Committee (MPC) has decided to maintain the policy rate at 12 percent. This decision reflects a balancing act between declining headline inflation and persistent core inflation, alongside a gaining traction in economic activity and emerging pressures on the external account. The headline inflation has fallen more than […]
The import basket composition: Economic Advisory Group (EAG) hopes for a decrease in the share of fuel products in favor of technology-intensive goods
Islamabad, February 20, 2025 – Pakistan’s economy is struggling under the weight of deep-rooted structural issues that threaten its long-term growth and global competitiveness. The Economic Advisory Group (EAG) highlights three key areas that require urgent attention: the country’s energy deficit, the disproportionate share of fuel imports in total trade, and the critically low imports […]
Economic Advisory Group Acknowledges Proactive Monetary Policy; Urges Caution Amid Persistent Tailwinds
Islamabad, January 29, 2025 – The Economic Advisory Group (EAG) recognizes the proactive stance taken by the State Bank of Pakistan (SBP) in its latest Monetary Policy Statement (MPS). While the central bank has delivered a measured interest rate cut, the EAG emphasizes the need for caution as underlying inflationary pressures and external risks persist. […]
SIFC: A wrong step at times of worsening investment climate
In their handbook chapter on what explains a country’s comparative advantage, Nathan Nunn and Daniel Trefler show that countries with better contracting institutions produce more sophisticated products. In contrast, countries with weak institutions specialize in low-value-added, and less sophisticated products. In this context, the recent amendments made to the Board of Investment Act take Pakistan […]
SBP continues to remain behind the curve
The Economic Advisory Group (EAG) has expressed serious concerns regarding the inadequate response from the State Bank of Pakistan (SBP) in pre-empting the ongoing crisis. Instead, the EAG argues, the SBP’s response, both in terms of setting the policy rate and interventions in the currency market – first through spending forex reserves and then through […]
Debt Restructuring
EAG advises debt restructuring and warns against import substitution policies Policymakers must acknowledge difficult choices the country faces and overcome policy paralysis to avoid a disorderly default The independent Economic Advisory Group (EAG) is concerned that the recent National Security Council (NSC) statement has failed to address the challenges Pakistan is currently facing. The lack […]