Pakistan has banned cabinet ministers from staying at five-star hotels on foreign trips and travel in classes other than economy in an attempt to reduce expenditure as the country negotiates a deal with the International Monetary Fund to avoid a default.
(Bloomberg) — Pakistan has banned cabinet ministers from staying at five-star hotels on foreign trips and travel in classes other than economy in an attempt to reduce expenditure as the country negotiates a deal with the International Monetary Fund to avoid a default.
In addition, federal, state ministers and high-ranking government officials have decided to voluntarily forgo their salaries and perks, Prime Minister Shehbaz Sharif said after a cabinet meeting in Islamabad.
“This is need of the hour,” he said. “We have to show what the time demands from us and that’s austerity, simplicity and sacrifice.”
The cost-cutting measures will reduce expenses by 200 billion rupees ($764 million) a year, Sharif said. He also said the nation will move office start time to 7:30 a.m. in the summer to save energy.
The South Asian nation is close to securing a deal with the IMF after its dollar reserves dropped to cover less than one month of imports and Fitch Ratings downgraded the nation deeper into junk twice in the past four months. The nation has seen a build up of thousands of containers at ports as banks don’t have dollars to clear payments.
The government has banned the purchase of luxury items and cars until next year, said Sharif. The nation plans to announce further measures in the budget for next financial year starting July.
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