Pakistan to get World emerging market status: Financial Times

[Muhammad Omar]

ISLAMABAD: (APP) Pakistan closes in on Morgan Stanley Capital International (MSCI) upgrade, promotion to emerging market status, as the country has in many respects fared reasonably well in recent years, reports Financial Times London.

A Financial Times report contributed by Steve Johnson said that terrorism-related deaths have fallen 74 percent from their 2010 peak, economic growth has accelerated to a solid 4.5 per cent, inflation has fallen sharply to around 3.3 per cent and the fiscal deficit has narrowed markedly to around 4.1 per cent of gross domestic product.

Quoting Charles Robertson, global chief economist at Renaissance Capital, an emerging market-focused investment bank, the Financial Times report said” On a per capita basis, the likelihood of being killed by a gun in the US is now higher than that of dying as a result of terrorism in Pakistan.”

The index provider is due to rule on whether Pakistan has done enough to be promoted to EM status on June 14.

And while this would be seen by many as a feather in Pakistan’s cap.

The report said that Pakistan currently has a weight of 8.8 per cent in the MSCI Frontier index (making it the fourth largest country after Kuwait, Argentina and Nigeria) but is only likely to account for around 0.19 per cent of admittedly much more widely followed MSCI EM index if promoted.

Experts, however, believe that an upgraded Pakistan would attract net inflows from foreign funds, even though it would have the second-lowest weighting in the 24-nation MSCI EM index, above only the Czech Republic.

“Frontier funds are quite index agnostic and I believe would be in no hurry at all to sell,” says Daniel Salter, head of emerging market equity strategy at Renaissance Capital.

“They are often able to hold off-index countries such as Saudi Arabia, UAE, Qatar and Egypt.”

When it comes to attracting fresh cash from actively managed EM funds, which of course would not need to buy even in the event of Pakistan’s promotion, Salter believes their nose for a bargain will play a role.

 

[touela]

I have a question to people in economics here. Lets suppose that Pakistan growth is sustained around 5 % per year the next 10-15 years, then what kind of economy would it be like ?
1. Would it rely heavely on export ( Japan, Taiwan, South Korea, Germany etc.).
2. Would it be like USA (only 1/3 of their manufacturing and services are exported)
3. Which sectors would be the dominant (remember we're talking about 10-15 years from now).
4. Other valid points, you think should be mentioned.

Thx.

 

[Hamza913]

I have a question to people in economics here. Lets suppose that Pakistan growth is sustained around 5 % per year the next 10-15 years, then what kind of economy would it be like ?
1. Would it rely heavely on export ( Japan, Taiwan, South Korea, Germany etc.).
2. Would it be like USA (only 1/3 of their manufacturing and services are exported)
3. Which sectors would be the dominant (remember we're talking about 10-15 years from now).
4. Other valid points, you think should be mentioned.

Thx.

1. We would probably be relying on imports, and starting some exports.
2. Nope.
3. Private, profit is a major incentive in Pakistan.
4. Forgive me if I am wrong.

 

[Jhon Smith]

Pak has poor performance in exports , If one look at Bangladesh even they are way ahead than to Pakistan.

What happen to Pakistan? In 2000 Pak was much better than to Bangladesh in economic performance.

I red even this years Pak to fail exports in amounts what they did last years

 

[sparten]

Exports falling and yet industry is doing fantastically. Pakistan is a large country and cannot be compared to Bdesh. Bangladesh relies on its overseas textiles exports, domestic demand is negligible. Pakistan's industrial output mostly is spent on the domestic market, our largest industries, cement, electronics/appliances, pharma and automative are mostly domestic only.

 

[muhammadali233]

Pak has poor performance in exports , If one look at Bangladesh even they are way ahead than to Pakistan.

What happen to Pakistan? In 2000 Pak was much better than to Bangladesh in economic performance.

I red even this years Pak to fail exports in amounts what they did last years

1.some of pak Factories have moved to Bangladesh because of cheap labour
2. Pak has suffered heavily after 2000 american invasion of afghanistan due to flow of terrorism from there.
3. Pak faced peak power shortages from the period 2007-2015
4.Huge demand inside pak makes less product left for export,we can't make enough due to high resources shortages.
Things are getting better now with a quite a pace bangla and Nigeria will be left behind by quite a margin soon

 

[Jhon Smith]

1.some of pak Factories have moved to Bangladesh because of cheap labour
2. Pak has suffered heavily after 2000 american invasion of afghanistan due to flow of terrorism from there.
3. Pak faced peak power shortages from the period 2007-2015
4.Huge demand inside pak makes less product left for export,we can't make enough due to high resources shortages.
Things are getting better now with a quite a pace bangla and Nigeria will be left behind by quite a margin soon

However Pak should ban on import of used computers and related stuff.USA , China and Europe r using Pak as dumping place of there waste. Its very expensive to rcycle e waste therefore west r using Pak as dumping ground !!
by giving free all there e waste


Pakistan a dumping ground for e-waste
— PUBLISHED JUN 24, 2009 12:00AM

 

[EAK]

But But ..But..Pakistan is failed state..

 

[ajpirzada]

Roman art developed after centuries of cheap copying of Greek art. The museums in Italy are full of such copies.

Dont get put off by the scrap news posted above. Let the scrap come. We'll learn to copy it, replicate it and maybe one day start innovating.

 

[Khan_21]

Pak has poor performance in exports , If one look at Bangladesh even they are way ahead than to Pakistan.

What happen to Pakistan? In 2000 Pak was much better than to Bangladesh in economic performance.

I red even this years Pak to fail exports in amounts what they did last years

Even though 2008 -2013 we suffered , We are still way ahead of Bangladesh Economically both in PPP and nominal . Exports are falling so are the imports balancing the equation .

Economically in 2016 we are in the best shape we ever been since 2006 .

Economic Growth = 5 %
MCSI Upgrade to emerging Market
Moody and standard upgrading our economic indicators
Large scale manufacturing increasing by 7 % this year
Low inflation
FDI increasing by 7 %

 

[touela]

Congrats everyone - we are back in MCSI. In the following PDF file, Pakistan is mentioned in the last 2 lines on the first page. This is really great news:

https://www.msci.com/documents/10199/4b1ba122-5f18-4a36-91c0-41a9b358c2ff

 

[randomradio]

I have a question to people in economics here. Lets suppose that Pakistan growth is sustained around 5 % per year the next 10-15 years, then what kind of economy would it be like ?
1. Would it rely heavely on export ( Japan, Taiwan, South Korea, Germany etc.).
2. Would it be like USA (only 1/3 of their manufacturing and services are exported)
3. Which sectors would be the dominant (remember we're talking about 10-15 years from now).
4. Other valid points, you think should be mentioned.

Thx.

1. No.
2. Yes.
3. Services.
4. 5% is too slow.

 

[touela]

1. No.
2. Yes.
3. Services.
4. 5% is too slow.

Thanks for replying @randomradio. Can you answer these question from India's perspective ?

 

[randomradio]

Thanks for replying @randomradio. Can you answer these question from India's perspective ?

There really isn't much from India's perspective. If CPEC succeeds, the Chinese will completely dominate the Pak market even at the expense of their domestic industry.

The Pakistanis may still import something from India, but growth in trade will be extremely low. India has no direct trade link with Pakistan, it is channeled through Dubai. So it will make Indian goods more expensive than Chinese goods.

As for Pak economy itself, we have to see how well it grows between 2018 and 2030. If growth rates don't pick up, the country will be in huge trouble because of their external debt situation.