Business & Economy

Pakistan registers first GDP contraction in 68 years

Islamabad, Jun 11 (efe-epa).- Pakistan’s GDP has contracted by 0.4 percent during the current fiscal year — set to end on 30 June — registering its first negative growth in 68 years due to the impact of the coronavirus crisis, according to estimates of an official survey released on Thursday.

“Pakistan has been affected by the unprecedented health and economic shocks caused by the outbreak of coronavirus,” said the Economic Survey 2019-2020, released by the government.

Prime Minister Imran Khan’s financial advisor Abdul Hafeez Shaikh said that the growth estimate before the start of the Covid-19 epidemic had been around 3 percent.

“Which means that we are facing 3 percent to 3.5 percent loss to our national income,” he said while releasing the survey.

Shaikh said that the coronavirus-induced slowdown had resulted in losses worth $18 billion to Pakistan.

The data means that the South Asian country’s GDP has changed its growth trajectory over the past few years, having recorded a growth rate of 3.3 percent in 2018 and 5.8 percent in 2017.

The services sector was hit the hardest, registering a growth of -3.4 percent, compared to 4.7 percent during the previous fiscal year.

Industry growth stood at -2.6 percent compared to 1.4 percent in 2018-19, with manufacturing results registering a -22.9 percent slump. Transport growth was recorded at -7.1 percent.

Agriculture, which accounts for 19 percent of Pakistan’s GDP but employs around 40 percent of the workforce, bucked the trend by registering a growth of 2.6 percent.

Fiscal deficit stood at $13.28 billion, compared to $17.8 billion the year before.

“Exports fell due to a fall in global demand while remittance decreased due to layoffs of Pakistanis employed abroad,” Shaikh explained.

Pakistani authorities imposed a lockdown between late March and the beginning of May, all but completely paralyzing the economy amid the coronavirus epidemic, which has killed more than 2,350 people and infected over 119,500 people in the country so far.

The country is also facing devastating locust swarms this year, which could cause economic losses worth 817 billion rupees (around $5 billion).

Pakistan has been facing economic troubles for many years now and received a bailout package worth $6 billion from the International Monetary Fund in May 2019. EFE-EPA


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