APRIL 28, 2024

ASSIGNMENT-1

FINANCIAL MANAGEMENT

DEPARTMENT OF MANAGEMENT SCIENCES, BBA 6-A

SUBMITTED TO: Mam. Raazia Gul

SUBMITTED BY: ABDUL BASIT
REG; 2111103
 FM
ASSIGNMENT-1
MOODY CASE STUDY
Pakistan's credit rating dropped from B3 to Caa1 by Moody's decision. The devastating floods
of June 2022 have compounded worries about Pakistan's cash, rising external vulnerability risks, and
growing debt sustainability issues, all of which are reflected in this decision. This is a brief
explanation of what transpired, what may be done to address it, and the importance of governance and
environmental issues.

First off, Pakistan was severely affected by floods in 2022, resulting in extensive damage estimated to
be worth $30 billion. This had a devastating effect on the nation already exhausted reserves in
addition to the people. It is not simple to recover from something like that, and Pakistan has been
under a lot of pressure to manage its finances.

Debt repayment has always been difficult for Pakistan, made more difficult during the floods due to a
poor economy and less money flowing to the government. Furthermore, Pakistan's saving appears to
be insufficient to fund two months’ worth of imports. As a result, the nation finds it more difficult to
handle its foreign investments and payments.

What then can Pakistan do to resume its course? Well, it’s similar to navigating a limit budget.
Circumstance at home. In order to increase revenue, the nation must develop fresher, more creative
methods to spend its money, such as enhancing the tax collection system. Additionally, Pakistan can
enhance its reserves by receiving assistance from outside allies like the IMF.

Finally, there is the whole issue of environmental, social, and governance or ESG. It's about handling
the big picture issues that impact everyone, not simply pretentious rhetoric. Large scale
environmental problems can have a negative impact on an economy, as the floods demonstrated.
Furthermore, it may truly make a difference to ensure that people's needs are met and that the
government is carrying out its duties. It is about ensuring that Pakistan is a just and sustainable nation
for all people, both today and in the future.

What then can Pakistan do to resume its course? Well, it’s similar to navigating a limit budget.
Circumstance at home. In order to increase revenue, the nation must develop fresher, more creative
methods to spend its money, such as enhancing the tax collection system. Additionally, Pakistan can
enhance its reserves by receiving assistance from outside allies like the IMF.