World Bank revises Pakistan's growth projections downward

[blueazure]

Do you think growth would be higher, lower or the same if those things hadn't happened?

i dont think any thing now . honestly, ive given up on pakistan(economy)

im my opinion, pakistan's economy and its managers are casino chip tossers . everyone rolls his own dice


on ground, situation is this _


1. manufacturing is shutting down. SMEs are selling their factories and prefer to buy 7/11s in outskirts of montreal etc ( aka immigration )

2. there is joblessness .

3. hi input cost and taxes

4. stupid regulations . i wanted to send 20000 USD to dubai for a vendor . bank asked me to open LC ? wtf . when the vendor doesnt want LC , why the bank wants it ?

5. no one wants to 'value invest' in pakistan anymore. everyone wants a quick buck and wants out . hi utility prices ( of gas and elec thanks to IMF) discourage industry unless you have your own power like NISHAT or LUCKY

6. hi dollar cost is discouraging even essential imports and ppl are cutting corners

 

[jupiter2007]

IK is hopefull that 2020 will bring major Positive changes in Pakistani economy but I think we will have to wait until 2021 or 2022 to see some positive economic indicators. IMF conditions, and incompetence is NAB, FIA and FBR are preventing real growth. Also, government and opposition is playing cat and mouse game and not doing real work.
Government was too slow to react about inconsistencies in BISP. Government should have passed the bill for harsh punishment for those illegally benefiting from any income support programs including, recovery, fines and termination of government officers.

IT will improve economy but nothing is done to be increase investment in IT field.
Digitalization and decentralization will real change. I still feel that dissolving provincial governments and going with Divisions (36 Divisions) government or District (total 136 districts) government should save us major $$$ and headaches in long run.

 

[Yaseen1]

i think after protests in india and unrest in many states of india we have better opportunity to attract foreign investors to setup industry in Pakistan but our govt is not utilizing this chance in better way

 

[jupiter2007]

i think after protests in india and unrest in many states of india we have better opportunity to attract foreign investors to setup industry in Pakistan but our govt is not utilizing this chance in better way

lol

One can tell the seriousness of government when they select a minister for the ministry.
Khalid Maqbool is IT minister, he just learned how to open his hotmail. Lol.
India took IT industry seriously and they established major IT hubs in India, Bangalore, Madras, Delhi, Hyderabad and Kolkata.

Pakistan need 4 major IT hubs, Karachi, Lahore, Islamabad and Peshawar.

 

[ziaulislam]

Also nothing in watér management. Claiming credit for PMLN projects

Well credit is where due dams is what PTI has done above average but not in water management
Just lining all canals will save 30 maf..8 times size of bhasha dam but cost less than bhasha dam

(70-80maf water goes through canal 40% is lost)

If drip irrigation is done assuming we use all our water we can increase productivity by 30 times

 

[alee92nawaz]

Well credit is where due dams is what PTI has done above average but not in water management
Just lining all canals will save 30 maf..8 times size of bhasha dam but cost less than bhasha dam

(70-80maf water goes through canal 40% is lost)

If drip irrigation is done assuming we use all our water we can increase productivity by 30 times

Yeah you're right. They are not even investing in studies related Water Management.

 

[Nilgiri]

World Bank revises Pakistan's growth projections downward
THE NEWSPAPER'S STAFF REPORTER

ISLAMABAD: The World Bank on Wednesday slightly lowered country’s growth rate projections for the current fiscal year and next two years owing to continuation of tight monetary policy and fiscal consolidation coupled with external factors.

In its latest report “2020 Global Economic Prospects” released on Wednesday, the bank forecast Pakistan’s current year growth rate at 2.4 per cent — about 0.3pc lower than its estimates of June 2019 — before touching 3pc next fiscal year and 3.9pc in FY2022.

“Pakistan’s growth is expected to rise to 3pc in the next fiscal year after bottoming out at 2.4pc in FY2019-20, which ends June 30”, said the bank adding that macroeconomic adjustment in the country including a continuation of tight monetary policy and fiscal consolidation is expected to continue.

The lower growth rate forecast is generally in line with a similar (0.2pc) decline in global growth rate during the current year and 1.5pc decline in the South Asian region.

While growth in Bangladesh is projected to remain above 7pc through the forecast horizon, “growth in Pakistan is projected to languish at 3pc or less through 2020 as macroeconomic stabilisation efforts weigh on activity.” Growth in India is projected to decelerate to 5pc in FY2019/20 amid enduring financial sector issues.

Revisions in line with falling growth rates across the world

Key risks to the regional outlook include a sharper-than-expected slowdown in major economies, a re-escalation of regional geopolitical tensions, and a setback in reforms to address impaired balance sheets in the financial and corporate sectors. South Asian growth is estimated to have decelerated to 4.9pc in 2019, substantially weaker than 7.1pc in the previous year.

The regional deceleration was pronounced in the two largest economies: India and Pakistan. Weak confidence, liquidity issues in the financial sector in India, and monetary tightening in Pakistan caused a sharp slowdown in fixed investment and a considerable softening in private consumption.

Export and import growth for the region as a whole moderated, in line with a continued slowdown in global trade and industrial activity. Business confidence was hampered by subdued consumer demand in India and security challenges in Sri Lanka. Demand faltered amid credit tightening, reflecting structurally high non-performing assets in Bangladesh, India, Pakistan and liquidity shortages in the non-bank financial sector in India, and tightening policies in Pakistan.

The bank said the growth had decelerated in the country to an estimated 3.3pc in FY2018-19, reflecting a broad-based weakening in domestic demand. “Significant depreciation of the Pakistani rupee (the nominal effective exchange rate depreciated about 20pc over the past year) resulted in inflationary pressures. Monetary policy tightening in response to elevated inflation restricted access to credit. The government retrenched, curtailing public investment, to deal with large twin deficits and low international reserves.”

Also progress in fiscal consolidation has broadly weakened. Pakistan’s budget deficit rose more sharply than expected. Contributing factors were a shortfall in revenue collection, combined with a sizable increase in interest payments.

The regional outlook for 2020 has deteriorated recently, and risks are tilted to the downside. Financial sector weakness will likely weigh on activity unless balance sheet vulnerabilities are addressed. Although recent tensions between India and Pakistan have abated, a reescalation would damage confidence and weigh on investment in the region.

For countries with elevated debt levels and large current account deficits like Pakistan and Sri Lanka, an unexpected tightening in global financing conditions could sharply raise borrowing costs and lead to stops in capital inflows.

Growth in the region is expected to rise to 5.5pc in 2020, assuming a modest rebound in domestic demand and as economic activity benefits from policy accommodation in India and Sri Lanka and improved business confidence and support from infrastructure investments in Afghanistan, Bangladesh, and Pakistan.

Published in Dawn, January 9th, 2020

@Nilgiri @ziaulislam @Pakistan Space Agency @PakSword

Good read, Pakistan must address the same old things it keeps doing otherwise it will not get enough change momentum out of the rut:

https://www.thenews.com.pk/magazine/money-matters/597503-the-burn-of-hot-money

I can't tag Oscar anymore, did he change name?

@Chak Bamu @ps3linux ....buddies happy new year and I will drop in here when I can (been too busy lately)

 

[ps3linux]

Government should apply for some loan from WB as well.. Projections will automatically revise.

IMF provides loan for budgetary support with conditions like reducing CAD, increasing prices of utilities, increasing interest rates to the extent of destroying the economy, installing its agents in the finance ministry, increasing tax base.

WB does not provide loan for budgetary support they fund infrastructure projects, with the mismanagement of Peshawar BRT funded by ADB I have serious doubts WB will fund projects in Pakistan without serious conditions.

@Chak Bamu @ps3linux ....buddies happy new year and I will drop in here when I can (been too busy lately)

Same to you.

 

[Norwegian]

IMF provides loan for budgetary support with conditions like reducing CAD, increasing prices of utilities, increasing interest rates to the extent of destroying the economy, installing its agents in the finance ministry, increasing tax base.

So reducing CAD, increasing tax base is destroying economy lol

 

[Turingsage]

If drip irrigation is done assuming we use all our water we can increase productivity by 30 times

Pakistan's agricultural production is not able to keep pace with one of the worlds highest population growth rates. The ten's of articles exposing the malnutrition in Pakistan is glibly ignored my PDF members flying the Pakistan flag while being residents of the West. That pretence, by these fake non-resident PDF'ers, advising and commenting on flour prices in Pakistan for IK's and ISPR's propaganda machine is not going to feed the hungry. Large scale manufacturing has actually shrunk by ten's of percentage points. Pakistani semi-industrial products cannot compete in world markets and are falling even further behind. There is a massive disconnect between reality and all the puffed up visions of improvement under IK's failing fantasy economy and it's fantasy cures for misidentified ills

Pakistan's agriculture sector on a long rough patch
"According to the Economic Survey of Pakistan, the agriculture sector grew marginally by 0.85% in fiscal year 2018-19 against the target of 3.8% as all major crops posted average negative growth of 4.43% against the growth target of 3.6%."
https://tribune.com.pk/story/2140410/2-pakistans-agriculture-sector-long-rough-patch/

 

[Smoke]

As a textile business owner who specializes in producing motorbike clothing for export, I am finding it increasing difficult to compete. My customers have stopped placing PO's to my domestic rivals and are instead shifting to Bangladesh, in-fact most have already received their orders from Bangladesh. The profits are just not there anymore. I had to drop 8 products as I wasn't making money anymore. I don't see this lasting much longer than August, already planning on a different strategy.

While the utility increases we can absorb, but raw material prices have shot up way too high while the cherry on top is the GST that has been added (fair enough), but since this has been implemented, i haven't received a single refund yet. DTRE applications take a good 4 months to be approved (Bangladesh approves it in 24 hours!!!!!), plus the whole SOP of DTRE's makes it a huge pain in the rear as customs officials will be looking at every opportunity to fill their pockets.

I saw an article on Dawn quoting PM IK asking the business community to pay taxes today.. and the comments section made me want to laugh at the stupidity of the general public. Apparently they think we make a ton of $$$ and don't pay our taxes.. sorry but.. Export companies get their money taxed before it is even deposited in our accounts, zero questions asked.

Cash flows have taken a humongous hit, try running a business with two hands tied behind your back while worrying about the fact that your legs are about to be bound too.

 

[AZ1]

IK is hopefull that 2020 will bring major Positive changes in Pakistani economy but I think we will have to wait until 2021 or 2022 to see some positive economic indicators. IMF conditions, and incompetence is NAB, FIA and FBR are preventing real growth. Also, government and opposition is playing cat and mouse game and not doing real work.
Government was too slow to react about inconsistencies in BISP. Government should have passed the bill for harsh punishment for those illegally benefiting from any income support programs including, recovery, fines and termination of government officers.

IT will improve economy but nothing is done to be increase investment in IT field.
Digitalization and decentralization will real change. I still feel that dissolving provincial governments and going with Divisions (36 Divisions) government or District (total 136 districts) government should save us major $$$ and headaches in long run.

By 2022 we have to start return china's loan for cpec

 

[jupiter2007]

By 2022 we have to start return china's loan for cpec

unless and until opposition help create new laws to bring real changes, We will be in trouble in few years. We need product export diversification and sustainable economic growth. Sustainable economic growth will come with proper investment in Agriculture sectors, fisheries, Textile, Tourism, Small Business development, IT, technology and Aviation industry.

Pakistan possesses a huge potential to attract foreign travelers, especially tourists from Asian countries. If promoted properly, Pakistan can become the next tourist destination for Chinese tourists. Can you imagine, 100,000 Chinese Tourists coming to Pakistan every Year.

 

[Tumba]

So World Bank forecast

India 4.8
Pakistan 2.4

and I see many pakistani posters in joy seeing the downward trend in Indian economy but by comparison Pakistani economy is in stagflation ... lower growth and higher inflation.

but again bottomline is our region is again falling in poverty India needs 8% growth to generate enough jobs for newly coming generation and Pakistan with even more population growth might need close to 10...