The World Bank sees GDP growth in Pakistan slow down to 3.7% due to macroeconomic imbalances, depleted foreign exchange reserves and tightening financial conditions.
In its latest Global Economic Prospects report, the Bank also says that over the medium-term Pakistan’s growth will bounce back to average 4.6% over the medium term.
The WB report comes as Pakistan’s Imran Khan-led government tries to stabilize foreign reserves with the help of Arab allies and neighboring power China, and also looks to attract huge investments from Saudi Arabia to offset economic pressures.
Globally, growth is expected to slow to 2.9 percent in 2019, the report titled Darkening Skies says. “International trade and investment are moderating, trade tensions remain elevated, and financing conditions are tightening,” the Bank notes.
Photo: Imran Khan Official FB Page
Overall, South Asia is likely to remain largely unaffected by growing uncertainties about the world economy, with both India and Bangladesh expected to record over 7% of growth.
In Pakistan, the Bank says, “macroeconomic imbalances weigh on growth outlook.”
“Pakistan is expected to face financing needs due to large current account and fiscal deficits combined with low international reserves. GDP growth is projected to decelerate to 3.7 percent in FY2018/19, with financial conditions tightening to help counter rising inflation and external vulnerabilities.
“Activity is projected to rebound and average 4.6 percent over the medium term with support from stabilizing macroeconomic conditions.”
