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WB, ADB cut Pakistan GDP forecast to below 1pc

Skull and Bones

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WB has projected that the real GDP growth would be standing at 0.4% in the current fiscal year​



ISLAMABAD: Projecting a massive decline in GDP growth to 0.4 percent, the World Bank (WB) warns that the non-completion of IMF programme, failure to secure financing from key bilateral partners and political instability may result in eruption of a major macroeconomic crisis.

While the Asian Development Bank (ADB), in a separate report, projects a significantly lower GDP growth rate of 0.6 percent, ballooning inflation of up to 27.5 percent and an ongoing foreign exchange crisis in Pakistan.

In Pakistan Development Outlook released here on Tuesday, the WB says: “The country’s outlook is subject to major downside risks, which, if they materialise, could result in a macroeconomic crisis. The non-completion of the IMF programme and failure to secure expected rollovers, refinancing, and new financing from key bilateral partners presents major risks.”

According to the WB report, approximately four million people fell below the poverty line as poverty increased by one percentage point in Pakistan during the last year. The poverty measured at the lower middle-income poverty line (3.65 USD/day 2017 PPP per capita) is projected to increase to 37.2 percent in FY23 against 36.2 percent in FY22 pushing an additional 3.9 million people into poverty as compared to FY22.

The World Bank’s office in Islamabad arranged a press briefing on the occasion of launching “Pakistan Development Update: Recent Economic Developments, Outlook and Risks”. WB’s Country Director Najy Behhassine stated in reply to a question that securing of external financing needs was must for the revival of the IMF programme. He said that Pakistan would have no choice but to seek the Fund programme as it would help restore confidence. He said that there was no trust deficit in the case of Pakistan as the disbursement of project loans remained historically high.

When asked about prospects of regional trade, the WB official said that Pakistan’s exports potential in case of regional integration stood at $68 billion out of which trade with India could jack up exports up to $10 billion over the medium term while it could go up by $13 billion with China.

The WB has projected that the real GDP growth would be standing at 0.4 percent in the current fiscal year against 6 percent in the last financial year while inflation on average would peak to 29.5 percent. The WB official said that the elevated inflation could not be termed as hyper-inflation because it would cross 50 percent then it would be declared as hyper-inflation. The WB says the financial account ran a deficit of $1.2 billion in H1 FY23 compared to a surplus of $10.1 billion in H1 FY22, the largest half-year deficit in the last twelve years, which was due to the lack of fresh financial inflows and substantial debt repayments over the period.

According to the ADO April 2023, ADB’s flagship economic report, Pakistan’s gross domestic product (GDP) growth is projected to slow to 0.6 percent in FY2023 from 6 percent last fiscal year as the economy struggles to recover. Growth is forecast to rise to 2 percent in FY2024, assuming the resumption of macroeconomic stability, implementation of reforms, post-flood recovery, and improving external conditions.

“Pakistan’s economy continues to face strong headwinds while last year’s catastrophic floods have exacerbated the economic and financial challenges,” said ADB Country Director for Pakistan Yong Ye.

“Yet, with a history of resilience in the face of adversity and depending on a fast return to stability twinned with robust macroeconomic and structural reforms, Pakistan can bounce back. ADB is committed to continuing to support Pakistan’s economic recovery and development plans.”

In FY2023, industrial growth is forecast to continue decelerating, which reflects fiscal and monetary tightening, a significant depreciation of the local currency, and higher domestic oil and electricity prices. The fiscal deficit is projected to narrow slightly to the equivalent of 6.9% of GDP in FY2023.

 
According to the ADO April 2023, ADB’s flagship economic report, Pakistan’s gross domestic product (GDP) growth is projected to slow to 0.6 percent in FY2023 from 6 percent last fiscal year as the economy struggles to recover. Growth is forecast to rise to 2 percent in FY2024, assuming the resumption of macroeconomic stability, implementation of reforms, post-flood recovery, and improving external conditions.

“Pakistan’s economy continues to face strong headwinds while last year’s catastrophic floods have exacerbated the economic and financial challenges,” said ADB Country Director for Pakistan Yong Ye.

“Yet, with a history of resilience in the face of adversity and depending on a fast return to stability twinned with robust macroeconomic and structural reforms, Pakistan can bounce back. ADB is committed to continuing to support Pakistan’s economic recovery and development plans.”

This is why elections that allow the end of this disastrous PDM government is what this country needs more than anything else. If we still have them beyond the end of this fiscal year at the end of June we are projected to only see 2% growth at best. But if we elected a competent government with the mandate to carry out reforms, we have the means to make a recovery.
 
When asked about prospects of regional trade, the WB official said that Pakistan’s exports potential in case of regional integration stood at $68 billion out of which trade with India could jack up exports up to $10 billion over the medium term while it could go up by $13 billion with China
what's currently stopping exports to China from reaching its supposed potential.
 
It is quite commendable that the growth will actually not be negative in FY 2023 given the contraction in volumes we are seeing in agriculture (floods) and in manufacturing (input constraints because of forex issues)

Regards
 
From the energy component, Pakistan show huge decline in importing Indonesian coal.

India, China, and SEA countries in other hand show more import on Indonesian coal.

From this recent data that I see, yup Pakistan economy seems have lot of pressure.

With commodity prices are going up again after OPEC oil cut, there is no other choice for Pakistan beside getting all out in economy and decrease its defense spending
 
what's currently stopping exports to China from reaching its supposed potential.

Why would China need to buy anything when it makes everything inhouse?

The export market is the west which China and India have locked down. Pakistan is left with crumbs with an incompetent leadership. Pakistan should have developed their industries in the 80s and 90s so India and China couldn't consolidate all the trade.
 
Pakistan politicians are really inept to f**k this up so bad. There should be no reason why a country like Pakistan growing at less than 1%, but yet we are here. Looks like they are still not learning their lessons.
 
@Indos Bro

You can help a brotherly Islamic country like Pakistan by supplying them free coal and edible oils

Regards
Islamic Connection will be active once India makes military aggression to Pakistan.

At least Indonesia did send 2 submarines, several warships, some fighter jets to Pakistan, and our leader said bluntly he wants to invade Andaman Islands region during 1965 Pak-India war.
 
Islamic Connection will be active once India makes military aggression to Pakistan.

At least Indonesia did send 2 submarines, several warships, some fighter jets to Pakistan, and our leader said bluntly he wants to invade Andaman Islands region during 1965 Pak-India war.

Situation has changed a lot compared to 1965 and 71...

It is not the same as it was.
 
Situation has changed a lot compared to 1965 and 71...

It is not the same as it was.
Sending submarines and others are unlikely under current situation.

But oil embargo, sending ammunition and weapons, money, and energy commodities are very likely. You can see what happen in Bosnia war as well in 1990s as the latest example despite Bosnia under European/ NATO arm embargo with no land and sea border with any Muslim countries.

The war in Syria also see lot of ammunition and weapons being sent from Muslim countries but that between Sunni vs Shia faction within Muslim world.

As India getting stronger, Muslim world is alhamduliLLAH also getting stronger if we base it on the last several decades
 
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Sending submarines and others are unlikely under current situation.

But oil embargo, sending ammunition and weapons are very likely. You can see what happen in Bosnia war as well in 1990s as the latest example despite Bosnia under European/ NATO arm embargo with no land and sea border with any Muslim countries.

The war in Syria also see lot of ammunition and weapons being sent from Muslim countries but that between Sunni vs Shia faction within Muslim world.

As India getting stronger, Muslim world is alhamduliLLAH also getting stronger if we base it on the last several decades
This is also the important of Russia to India as Russia can become alternative energy supply to India if such a scenario happen
 
Things are bleek and sadly people have lost lives due to stampede. But mercifully, no Pakistani farmer or otherwise has ended life through desperation.
It's visible on the streets and even Imran Khan recently disclosed that public have money if not rich but it's the government that through their corruption and malpractices is poor.
 
Islamic Connection will be active once India makes military aggression to Pakistan.

At least Indonesia did send 2 submarines, several warships, some fighter jets to Pakistan, and our leader said bluntly he wants to invade Andaman Islands region during 1965 Pak-India war.
I think Indonesia and Iran were the two most important supporters in '65 war

Things are bleek and sadly people have lost lives due to stampede. But mercifully, no Pakistani farmer or otherwise has ended life through desperation.
It's visible on the streets and even Imran Khan recently disclosed that public have money if not rich but it's the government that through their corruption and malpractices is poor.
There is still hope. It's very fragile. But, the bastards are still not backing down.
 
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