ISLAMABAD: Finance Minister Muhammad Aurangzeb has invited German companies to invest in Pakistan.

A delegation of investors and traders led by German Ambassador Ina Lippel met Federal Finance Minister Muhammad Aurangzeb, in which the Finance Minister highlighted Pakistan’s economic stability and reform policy.

The Finance Minister said that Pakistan’s economy is now moving towards stability on strong foundations. The country’s foreign exchange reserves have become equivalent to two and a half months of imports and are expected to reach three months by the end of the fiscal year. Similarly, the inflation rate is forecast to remain between 5 and 7 percent, while the reduction in policy rates is expected to significantly reduce business costs.

He said that the three global rating agencies Fitch, S&P and Moody’s have improved Pakistan’s rating outlook. The IMF’s recent staff level agreement is also a reflection of confidence in Pakistan’s policies.

The Finance Minister said that the government is committed to deep reform measures in taxation, energy, privatization and public finance. The target is to increase the tax-to-GDP ratio from 10.2 percent to 11 percent in the fiscal year. Similarly, the tax collection rate will be taken to 13 percent.

Giving details to the delegation, the Finance Minister said that 34 government institutions have been handed over to the Privatization Commission, where implementation has started. Four major foreign companies are ready for the privatization of the national airline PIA.

He said that public finance reforms and pension structure have been restructured. Pakistan will soon issue its first Panda Bond in the Chinese market. Progress is also being made on the plan to return to the Eurobond market. The issues of profit and dividend transfer of foreign companies are being resolved amicably.

Finally, the Finance Minister invited German investors to take advantage of opportunities in the technology, energy and industrial sectors.