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ISLAMABAD: The United Nations Economic and Social Commission for Asia and the Pacific (UNESCAP) says Pakistan's economic growth is likely to hover around 4.1% in the fiscal year 2014.
"There have been some positive changes in the economy in recent months, such as improved growth of large-scale manufacturing industries, expansion in private sector credit, accumulation of foreign exchange reserves, and local currency appreciation", said a UNESCAP report launched on Wednesday in Bangkok.
Highlighting Pakistan's briefing note, the UNESCAP in a statement said that the country's economic growth slowed to 3.7% in the fiscal year 2013 from 3.8 % a year earlier.
It said that agricultural output growth decelerated in 2013 due to poor weather conditions, while industrial production picked up on capacity enhancement and investment in alternate energy, especially by large-scale manufacturing operations.
On the demand side, the UN report further said that an impetus to growth came from private and public consumption, whereas overall investment remained sluggish.
"The investment-to-GDP ratio fell slightly to 14.2% of GDP in 2013, which is lower than most other economies in South and South-West Asia," it said.
The UNESCAP added that Inflation softened but still high as the Inflation decreased to 7.4% in 2013, although the impact of the depreciating currency was felt in the later part of the year.
"The currency has appreciated in recent months, which should help contain inflation in the current fiscal year", the UN report said.
It further said that Pakistan's current account deficit shrank and goods exports rebounded in 2013 after a contraction in 2012.
The UN report said that the pickup was mainly fuelled by revived import demand from developed economies.
The export items are typically low value-added and concentrated in textiles and garments, it added.
The report said that the current account deficit decreased to 1% of GDP in 2013, from 2.1% of GDP in 2012.
In addition to the export rebound, the government addressed a trade deficit by introducing measures to curb gold imports, the UNESCAP report said.
The UNESCAP report said that Pakistan's remittances inflows have been growing in recent years while these remittances have supported household spending.
The UN report further said that foreign exchange reserves dropped in 2013 and the level at year-end was equivalent to only 2 months of imports, although this has improved in recent months.
It added that financial support from the IMF was secured after the government made commitments to tackle the fiscal deficit.
It suggested that reducing the fiscal shortfall should not be at the cost of development and social expenditures, but rather through revenue - raising measures, reforms of state-owned enterprises and rationalizing current spending.
About the accommodative macroeconomic policy stance of the country, the UNESCAP report said that the fiscal deficit edged up to 8.2% of GDP in 2013, from close to 7% inboth 2011 and 2012.
The shortfall has widened over the past years, partly due to contingent liabilities associated with public-private partnership projects, especially in the energy sector, it added.
The UN report also said that limited fiscal space has not only reduced available funds for development expenditure, but a large proportion of current expenditure is financed through borrowing.
It added that after some easing in mid-2013 amid lower inflation and weaker growth momentum, the monetary policy changed course in the later months of the year as inflationary pressure escalated.
The report further said that medium-term development challenges for tackling severe energy shortages is key to promoting investment and growth Pakistan's economic structure, ESCAP analysis suggests that tax revenue could be raised by nearly 20%.
Among others, policies to enhance domestic resource mobilization include rationalizing the tax system to create a larger tax base, tackling tax evasion and tax fraud, and strengthening tax administration.
The government is already addressing some of these issues, it added. (APP)
Pakistan’s GDP seen growing by 4.1pc in 2014
"There have been some positive changes in the economy in recent months, such as improved growth of large-scale manufacturing industries, expansion in private sector credit, accumulation of foreign exchange reserves, and local currency appreciation", said a UNESCAP report launched on Wednesday in Bangkok.
Highlighting Pakistan's briefing note, the UNESCAP in a statement said that the country's economic growth slowed to 3.7% in the fiscal year 2013 from 3.8 % a year earlier.
It said that agricultural output growth decelerated in 2013 due to poor weather conditions, while industrial production picked up on capacity enhancement and investment in alternate energy, especially by large-scale manufacturing operations.
On the demand side, the UN report further said that an impetus to growth came from private and public consumption, whereas overall investment remained sluggish.
"The investment-to-GDP ratio fell slightly to 14.2% of GDP in 2013, which is lower than most other economies in South and South-West Asia," it said.
The UNESCAP added that Inflation softened but still high as the Inflation decreased to 7.4% in 2013, although the impact of the depreciating currency was felt in the later part of the year.
"The currency has appreciated in recent months, which should help contain inflation in the current fiscal year", the UN report said.
It further said that Pakistan's current account deficit shrank and goods exports rebounded in 2013 after a contraction in 2012.
The UN report said that the pickup was mainly fuelled by revived import demand from developed economies.
The export items are typically low value-added and concentrated in textiles and garments, it added.
The report said that the current account deficit decreased to 1% of GDP in 2013, from 2.1% of GDP in 2012.
In addition to the export rebound, the government addressed a trade deficit by introducing measures to curb gold imports, the UNESCAP report said.
The UNESCAP report said that Pakistan's remittances inflows have been growing in recent years while these remittances have supported household spending.
The UN report further said that foreign exchange reserves dropped in 2013 and the level at year-end was equivalent to only 2 months of imports, although this has improved in recent months.
It added that financial support from the IMF was secured after the government made commitments to tackle the fiscal deficit.
It suggested that reducing the fiscal shortfall should not be at the cost of development and social expenditures, but rather through revenue - raising measures, reforms of state-owned enterprises and rationalizing current spending.
About the accommodative macroeconomic policy stance of the country, the UNESCAP report said that the fiscal deficit edged up to 8.2% of GDP in 2013, from close to 7% inboth 2011 and 2012.
The shortfall has widened over the past years, partly due to contingent liabilities associated with public-private partnership projects, especially in the energy sector, it added.
The UN report also said that limited fiscal space has not only reduced available funds for development expenditure, but a large proportion of current expenditure is financed through borrowing.
It added that after some easing in mid-2013 amid lower inflation and weaker growth momentum, the monetary policy changed course in the later months of the year as inflationary pressure escalated.
The report further said that medium-term development challenges for tackling severe energy shortages is key to promoting investment and growth Pakistan's economic structure, ESCAP analysis suggests that tax revenue could be raised by nearly 20%.
Among others, policies to enhance domestic resource mobilization include rationalizing the tax system to create a larger tax base, tackling tax evasion and tax fraud, and strengthening tax administration.
The government is already addressing some of these issues, it added. (APP)
Pakistan’s GDP seen growing by 4.1pc in 2014
ridiculous as it seems when Munshi Dar lied it to be 4.1 when it actually was 3.3.
