ISLAMABAD: Government and Asian Development Bank (ADB) signed a Loan Agreement of US $ 300 million for Public Sector Enterprises Reform Program (Subprogram-2).

The loan agreement was signed by Mr. Tariq Mahmood Pasha, Secretary, Economic Affairs Division (EAD) and Ms. Xiaohong Yang, Country Director, Asian Development Bank (ADB).

The Subprogram-2 of the Public-Sector Enterprises Reform Program will help the Government of Pakistan to achieve and sustain reform initiatives aimed at enhancing the performance of Public Sector Enterprises (PSEs) by improving their corporate governance and accountability, and reducing their contingent liabilities. Subprogram-2 will facilitate creating fiscal space for critical development expenditures.

To facilitate GOP’s reform initiatives, ADB approved Subprogram-1 of the Programmatic Approach in June 2016. Subprogram-2 will carry forward all the reforms initiated under Subprogram-1 to its logical conclusion. The Programmatic Approach addresses the following important challenges while initiating critical PSE reforms.

 Facilitate coordination across various government departments to (a) implement good corporate governance principles effectively; (b) articulate crucial guiding principles, such as transparency and consistency, on issues related to labor (including retirement benefits); (c) monitor and evaluate PSE performance; and (d) implement critical structural reform in some selected PSEs to get maximum benefits.

Some of the reforms already initiated under subprogram 1, by their very nature, have a long-term implementation cycle. These reforms will need to be carried forward. A continued assistance for such reforms would consolidate and sustain gains made towards better performance of the federal PSEs.