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Pakistan’s Finance Minister Resigns Amid Economic Crisis

Pakistan's Finance Minister Asad Umar addresses a news conference in Islamabad, Pakistan, April 18, 2019.

Pakistan Finance Minister Asad Umar has resigned days after returning home from crucial talks with the International Monetary Fund (IMF) on a financial bailout package to avert a national balance of payments crisis.

While formally announcing his decision to leave Thursday at a hurriedly arranged news conference in Islamabad, Umar explained that he was asked to take the energy minister position instead of finance as part of a Cabinet reorganization.

Umar acknowledged his successor would have to make "some difficult decisions" to deal with economic challenges facing Pakistan.

Prime Minister Imran Khan's eight-month-old administration has faced sustained criticism from political opponents, independent commentators and the business community over the government's handling of the economic crisis facing the country. Much of that criticism was leveled against Umar.

Umar returned this week from Washington, where his delegation fleshed out details of Pakistan's next IMF bailout package that he said could be up to $8 billion.

Critics blamed the outgoing minister for taking months to finalize the IMF deal, saying the delay shattered investor confidence in Pakistan's economy. But speaking Thursday, Umar defended his performance.

"We have finalized the IMF agreement on much better terms than before.I have made these decisions.I refused to take the decisions that would have crushed the nation," Umar said without elaborating.

He said that an IMF mission is expected to visit Islamabad later this month to work out more details "since all major issues had been settled and documented," he said.

13th bailout

The long-delayed package would be Pakistan's 13th IMF bailout since the late 1980s and comes with a worsening economic outlook for the South Asian nation of more than 200 million people.

Former finance minister Salman Shah, while commenting on Umar's resignation, noted a lack of effective financial strategy was slowing down the economy, deterring all sorts of investments, fueling inflation and unemployment in Pakistan.

Late Thursday, the government made the formal announcement about the Cabinet reorginization, re-allocating certain portfolios and appointing new ministers as well as several special advisors to the prime minister. They included Abdul Hafeez Sheikh as advisor on finance to Khan. Sheikh served as finance minister of Pakistan under a previous government. Khan has also appointed Ijaz Ahmed Shah as his full time interior minister.