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WASHINGTON (US): The World Bank [WB] and the International Monetary Fund [IMF] Tuesday appreciated the performance of Pakistan's economic and fiscal policies-based on discipline, prudence and reform.

It was stated in the meetings Governor of the State Bank of Pakistan (SBP) Dr. Ishrat Husain held with with the officials of the IMF and the WB on Financial Sector Assessment Program (FSAP).

The deputy Managing Director of the IMF appreciated the performance of the economic team of Pakistan, especially its fiscal managers.

"The IMF appreciated that economic and monetary policy is prudential, which is giving dividends," said economic affairs division minister, Embassy of Pakistan.

Talking to Khalilur Rehman Bughio, Special Correspondent of Pakistan's state-run news agency, Mushtaq Malik said "the IMF was appreciative of the fact that Pakistan has issued Euro bonds which will have a good impact in the capital market."

Pakistan, it said no more depended on loans.

Dr. Ishrat Hussain explained how Pakistan is controlling money supply and foreign exchange "in a flexible manner."

Economy

He explained how the country's economy has shown an upward trend, and financial discipline has been remarkable, how Pakistan was controlling food market, especially when the private sector has also been allowed to procure and sell wheat in the open market.

The World Bank, likewise, appreciated Pakistan's track record of reforms.

About the FSAP, the WB officials said, it would be the first program in Pakistan which will be implemented without any disruption or faltering of the control of the Government.

"With an elected Government in place, and firm resolve to stay on reforms pace," the World Bank officials said, "the country will move rapidly to uplift and prosperity."

Reforms Package

It is because pursuing reforms package would help allegation of poverty and bring about well-being of the people, noting that there was an interlink between growth and poverty, as when economic growth is attained the poverty slides.

"Pakistan's economy has done well, having a good general impact, as evinced from the different economic indicators, based on meeting of set targets."

IMF

The SBP Government also held a meeting with Mohsin Khan, director IMF.

During the talks, the SBG was accompanied by Mushtaq Malik, economic affairs minister in the Pakistan Embassy.

The Financial Sector Assessment Program (FSAP) is a joint IMF and World Bank effort introduced in May 1999, which aims at increasing the effectiveness of efforts to promote the soundness of financial sytems in member countries.

Supported by experts from a range of national agencies and standard-setting bodies, work under the program seeks to identify the strengths and vulnerabilities of a country's financial system; to determine how key sources of risk are being managed; to ascertain the sector's developmental and technical assistance needs; and to help prioritize policy responses.

Financial Sector

Detailed assessments of observance of relevant financial sector standards and codes, which give rise to Reports on Observance of Standards and Codes (ROSCs) as a by-product, are a key component of the FSAP. The FSAP also forms the basis of Financial System Stability Assessments (FSSAs), in which IMF staff address issues of relevance to IMF surveillance, including risks to macroeconomic stability stemming from the financial sector and the capacity of the sector to absorb macro-economic shocks.

Resilient, well-regulated financial systems are essential for macroeconomic and financial stability in a world of increased capital flows.