Floods to hit economic growth: Finance Ministry

[fawwaxs]

KARACHI: Pakistan's catastrophic floods means it will miss this year's 4.5 per cent gross domestic product (GDP) growth target this year though it is not yet clear by how much, a finance ministry official said on Tuesday.

The International Monetary Fund (IMF) said on Monday the floods, the worst in 80 years, will cause major economic harm as donor and investor concerns grow over the disaster's impact on an already fragile economy.

“It is too early to say the extent of damage and loss of crops. But yes, it is a major catastrophe and it will have a negative impact on economic growth,” said Finance Ministry spokesman Asif Bajwa.

The government said it was assessing the damage but it would be substantial, especially in the agriculture sector which accounts for more than 21 per cent of GDP and employs 45 per cent of the labour force.

An economic growth target of 4.5 per cent in the 2010/11 (July-June) fiscal year would have to be revised downwards once the extent of the damage was known, he said. Growth was 4.1 per cent last year.

The government had to turn to the IMF in November 2008 for emergency financing of $11.3 billion. It has since struggled to meet Fund guidelines and is expected to have missied a target for the fiscal deficit for the quarter ending on June 30.

Pakistan and IMF officials are due to meet on Aug. 23 to discuss a sixth tranche of the loan and Bajwa said the IMF could provide more fiscal space in light of the floods.

The floods, triggered by unusually heavy monsoon rain over the upper Indus river basin over the past 10 days, have ploughed a swathe of destruction more than 1,000 km (600 miles) long from northern Pakistan to the south, killing more than 1,600 people and making two million people homeless.

After touching a near one-month low on Monday on concerns over the economic impact of the flooods, the main index was barely changed on Tuesday in extremely thin trade as most investors stayed on the sidelines. – Reuters


DAWN.COM | Business | Floods to hit economic growth: Finance Ministry

 

[gowthamraj]

loosing 4 year of growth is really a bad thing. hope some reforms are made

 

[SekrutYakhni]

Precious lives lost, infrastructure crippled--It really hurts, really!

Get together and help each other!

 

[sparklingway]

Qadirpur and Kankot gas fields closed after flooding. Guddu power plant shut down after cut in gas supply. Kot Addu is already non-functional.

 

[fawwaxs]

About 500,000 tonnes wheat lost in floods

ISLAMABAD: Floods in Pakistan have destroyed about 500,000 tonnes of wheat, meaning a smaller surplus for the country this year, agriculture officials said on Thursday.

“Our estimate is that up to 500,000 of wheat stocked with the people has been washed away,” Ibrahim Mughal, president of a national farmers' association, told Reuters.

A Food Ministry official said up to 600,000 tonnes of wheat had been damaged or destroyed in the flood.

The floods also destroyed up to two million bales of cotton, industry officials said.

“According to our initial reports, 1.5 million to two million bales have been affected by the floods,” Naseem Usman, chairman of the Karachi-based Cotton Brokers' Forum, told Reuters on Thursday.

Pakistan, the world's fourth biggest cotton producer, had been hoping to produce 14 million bales of cotton in the 2010/11 season, compared with about 12.7 million bales last year. A bale weighs 1

 

[AZADPAKISTAN2009]

But there will be still politicians in Sindh or Paktoon region who will say we will not build Kalabagh dam ... becasue it will displace few cities or villages

I guess ppl don't reall see the big picture of losses

 

[Chocolate]

WAS Pakistan growing at 4.5%?Before the floods?!

 

[indushek]

I think it was growing at 5 to 6% which is really very good. Too bad for them.

 

[Jacobtheindoamerican]

It was growing 2% not 4-5%.. 2000s have been bad years for Pakistans GDP growth..

 

[su-47]

It was growing 2% not 4-5%.. 2000s have been bad years for Pakistans GDP growth..

actually despite all the problems, the 2000s has not been so bad for pak economy. During the period between 2003-2008 Pak was one of the fastest growing economies. Everything went down the drain after 2008.

GDP - real growth rate: 2.7% (2009 est.)
3.4% (2008 est.)
6% (2007 est.)


Year GDP - real growth rate Rank Percent Change Date of Information
2003 4.50 % 48 FY01/02 est.
2004 5.50 % 45 22.22 % 2003 est.
2005 6.10 % 47 10.91 % 2004 est.
2006 6.60 % 48 8.20 % 2005 est.
2007 6.60 % 59 0.00 % 2006 est.
2008 5.30 % 104 -19.70 % 2007 est.
2009 2.70 % 139 -49.06 % 2008 est.
2010 2.70 % 67 0.00 % 2009 est.
Definition: This entry gives GDP growth on an annual basis adjusted for inflation and expressed as a percent.

Pakistan GDP - real growth rate - Economy

 

[Meengla]

Business Recorder [Pakistan's First Financial Daily]

Pakistan is likely to lose 1-1.5percent of its GDP growth against its target of 4.5 percent as the devastation caused by floods is unfolding and some key sectors of the economy have been badly damaged, says an official. The Finance Ministry believes that the exact impact of this destruction is to be estimated in next few days when the initial reports of damage assessment will arrive from the flood-hit areas.

Agriculture sector growth was estimated at 4 percent of GDP out of 4.5 percent of total GDP growth and the agri growth could reduce to one half or one third depending upon the reports, which are yet to come. Agriculture sector accounts for over 21 percent of GDP and employs 45 percent of the labour force in the country.

 

[Aeon]

But there will be still politicians in Sindh or Paktoon region who will say we will not build Kalabagh dam ... becasue it will displace few cities or villages

I guess ppl don't reall see the big picture of losses

What would be the population of those cities and villages?

From what I've read so far, the flood has caused the displacement of about 13 million Pakistani. Apparently those few cities and villages are worth the displacement of about 7% of the whole population of Pakistan, and who knows how many dead yet to be revealed. Not to mention the huge suffering of affected people, and the suppression of economy (which will in turn increase the suffering of the entire country) that is occurring and yet to follow.

 

[Luftwaffe]

Calculations shows Pakistan need $1 Billion dollars to just barely feed 1 coror 50,000 people.

 

[Nahraf]

Now the corrupt and inefficient PPP government has found floods as a convenient excuse for it's economic failures.

 

[fawwaxs]

Farm, livestock sectors suffer colossal loss

ISLAMABAD: The country has suffered a loss of about Rs250 billion in the agricultural and livestock sectors and the flood recovery costs may run into billions of dollars, local experts and a UN spokesman said on Thursday.

The Minister for Food and Agriculture, Nazar Mohammad Gondal, said: “It is difficult to give an exact figure, but I agree that the loss of agriculture and livestock runs into billions of rupees.”

“The floods have destroyed crops of cotton, rice, sugarcane and tobacco worth billions of rupees.”

Javed Saleem, a former president of the Crops Protection Association (CPA), and Ibrahim Mughal, chairman of the Pakistan Agricultural Farms Association (PAFA), said over 17 million acres of agricultural land had been submerged and ripe crops of rice, cotton and sugarcane destroyed.

Over 100,000 cows, buffaloes, goats, sheep, horses, camels and donkeys have been lost and 3,000 fish farms and 2,000 poultry farms destroyed across the country.

“According to an estimate, the loss of cotton crop is of about Rs155 billion,” Mr Saleem said.

In Punjab alone, a cotton growing area of about one million acres had been affected and crops worth Rs86 billion destroyed, he said.

“The whole agricultural belt that includes Jhang, Bhakkar, Rajanpur, Rahimyar Khan and Layyah has been inundated.”

Sindh has lost standing crops worth Rs95 billion over 100,000 acres. Cotton and rice are the major crops destroyed by the floods.

In Khyber Pakhtunkhwa, over 325,000 acres have been submerged and crops worth Rs29.6 billion destroyed.

Mr Mughal said over one million tons of wheat stock kept in houses had been swept away.

“About 1,000 tractors have also been lost,” he said.

According to dealers, the floods have caused a shortage of food items and the prices of fruits and vegetables have increased by 25 to 50 per cent.

It is feared that the situation will persist for the whole year till cultivation resumes in flooded areas.

Consumption of fruits and vegetables usually increases during Ramazan.

“We are receiving only 800 trucks loaded with fruits and vegetables a day in Islamabad, compared to last year’s supply of 2,000 in Ramazan,” Safdar Siddique, president of the Islamabad Fruit and Vegetable Market, said.

“We are importing potatoes and tomatoes from India to meet the demand,” he said.

The experts said the shortage could be overcome if the government lifted the 25 per cent import duty and 10 per cent sales tax on agricultural items.

Agencies add:



United Nations humanitarian operations spokesman Maurizio Giuliano said: “The devastation to crops is immense. I think it’s safe to say it will take some billions of dollars to recover. Even though we don’t have estimates yet, I am referring to livelihood for agriculture and farming to get back in shape.”

Two million people require shelter after fleeing flood-hit areas. Survivors face grim conditions in tent cities and diseases are flourishing in an unbearable heat.

The UN humanitarian coordinator in Pakistan, Martin Mogwanja, said pledges of $195 million had already been made in response to an appeal for $460 million in foreign aid.

Foreign Minister Shah Mehmood Qureshi, after flying over flood-hit areas with diplomats, said: “An estimated 15-20 million people are believed to have been affected.”

Appealing for international help, he said: “We immediately need tents for shelter, food for survivors, water purification plants and medicines for cholera, malaria and other water-borne diseases.”

UN official Ban Al Dhayi warned of a risk of water-borne diseases and illnesses such as diarrhoea, malaria and dengue fever.

“There are fears of an outbreak of vaccine-preventable diseases like measles, polio and tetanus. Respiratory infections are a huge threat as well, especially among children,” he said at a news conference.

World Food Programme official Wolfgang Herbinger said the UN had enough food to cater for more than two million people over 10 days, but bad weather and limited access was a problem.

Iftikhar A. Khan adds:



According to a perception survey carried out by the Gallup Pakistan, over one-third of the country’s people have been affected by the floods.

Fourteen per cent of the respondents from a nationally representative sample said that they had been affected very seriously, 23 per cent said they had been affected to some extent, 29 per cent said their losses had been mild, while 31 per cent said they had not been affected and three per cent gave no response.