Pakistan current account deficit to shrink at fast pace from July onwards

[Crusher]

Come out of your lala land Mr.Dont give false hopes.Pak GDP growth is projected at 2.8 % in 5 years.What a shame

No shame whatsoever, because that will be the real GDP growth of pakistan, it wouldn't be fake growth rates of the past years entirely dependent on 10s of billions of dollars of loans from international financial institutions which pakistan CANNOT pay on its own in the given geopolitical and international situation.

 

[Mrc]

Govt needs now to make an extraordinary push to operationalize the special economic zones under cpec... And get some export oriented Chinese industries here...

Our exports need to pick up now...

 

[B.K.N]

Come out of your lala land Mr.Dont give false hopes.Pak GDP growth is projected at 2.8 % in 5 years.What a shame

Gdp growth and current account defecit is not same thing

 

[BHarwana]

Saudis oil package to start kick in as 3.2 billion dollars oil per year on deferred payment will commence from July 1st, 2019 onwards for 3 years.

Imports bill will be significantly reduced moreover dollar price will decrease as well. Much needed economical stability is expected. Also at the same time, imf loans will start kicking in as well.

But you said that previously current account deficit was shrinking because of this?

Bro the current account deficit is shrinking because of the policies of PTI not because of deferred of payments on oil.

PMLN started import spree is so big that oil became small part of imports. This will have no effect rather other PTI policies are helping shrink CAD

 

[Crusher]

I like Trump's way of controlling trade and current account deficits by putting penalty tariffs on made in china junk imports. Maybe we should also do the same but free trade agreement (FTA) signed during mushi/salman shah time is perhaps a hindrance in that direction. Remember our biggest source of trade deficit is the annual transfer of billions of dollars from pakistan to china, I know some people don't like to face this reality but the reality remains reality, we have currently 10 billion dollar trade deficit with china and it is increasing every year due to criminal FTA between China and Pakistan.

 

[PakSword]

This is a great achievement..

I know that some of the PMLN members will say that Pakistan is losing on import tariffs.. and we know they are the real a$$holes of our society..

 

[Imran Khan]

hope best for my country

 

[LeGenD]

Don't under estimate Pak economy. In 1971 when Pakistan was dismembered, the economy was in its worst condition. But it recovered in two years. Then after the atomic explosions, Pakistan not only survived despite sanctions, but after couple of years the economic growth was 6% plus.
Pakistan's economy has a resilience or a latent drive, which sometimes conceals itself somewhere, then with a little correction work it recovers itself and then grows at a comfortable rate. This has been happening right from the inception of Pakistan. The mistake Pakistan had committed, was reversal of Z.A. Bhutto's indigenous economic and industrial policies. All the indigenous hard work done during ZAB's era was made ZERO by Zia-ul-Haq's government.
This time, after the correction is done - in about two years - then it will take a year or two to make the economy steady, thereafter it will grow at a faster rate.

Pakistan's economy have never rebounced on its own - always through foreign support one way or the other.

American aid at a glance.

In the 1990s, KSA came to our rescue: http://time.com/5531724/saudi-arabia-pakistan-mbs-imran-khan/

"Saudi Arabia has a long history of providing financial support to Pakistan. That includes funneling money through Pakistan’s madrassa education system, cushioning the impact of international sanctions following its nuclear test in the late 1990s, and loaning Islamabad $1.5 billion when the Pakistani rupee crashed in 2014."

IMF packages at a glance.

China also providing funds to Pakistan since 2000.

Pakistan have a dysfunctional economy due to a lengthy history of corruption and bad politics. Sorry bro.

 

[ps3linux]

@war&peace @zulu @Reddington @Dubious @Khafee @PaklovesTurkiye @PakSword @ali_raza @ps3linux
Paks,

This is quite a great development for Pak State!

We need to understand that in this Hybridwar...where EconomicTerrorists have been playing the markets and creating artificial shortage of dollar supply....

This give much needed breathing space as well. We can now focus on structural reforms as well. The key is to tackle IPP mafia and LNG mafia in the PSO/Energy Ministery as well.

KSA has yet again proven to be a true brother and friend in need...

It is important to see this development in light of Pak State and not in terms of political loyalties!

Good news... we need to now focus also on debt restructuring... the key here is National Debt Commission under SCP.

We need to make public the National Debt and obligations as well.... this is the only way to contain EconomicTerrorism for spreading further!

Mangus

Sorry I m not too well these days thats why I post off and on, financially budget 2019-20 is important, along saudi package, decreasing CAD inflation will peak out in Sep/Oct, forex problem might get solved in next fiscal year but two things which worry me our fiscal deficit is now at 5% which is really really bad, means tax collection situation is not improving they will have to address it. Second saudi package is a loan and we will have to pay it back, means more burden to already screwed foreign debt problem, moreover the future cost of this package cannon fodder to yemen war or Arab - Iran war, that is what really is the crux we as pakistanis have a mixed population we cannot afford to become part of anyones war both arabs and Iranian have already seeded enough hatred and divide in our society for the last 40 year thanks to zia and his minions.

 

[Crusher]

China also provide funds to Pakistan now.

Pakistan have a dysfunctional economy in reality. Sorry bro.

China is pretty clever, unlike US aid, the so-called funds coming from China to pakistan are all loans which are spent almost entirely on "CPEC" projects, only chinese companies are building the CPEC projects so all those loans coming from China are paid to Chinese companies for CPEC projects so money once again moves back to China, so China money/dollars come to pakistan only to go back to china through chinese companies working on CPEC. And in the mean time pakistan becomes indebted to China without even that money being in any control of state bank of pakistan. That is also the reason why we have to go to IMF, World Bank, GCC countries, float dollar/euro bonds so that we can pay the interest of the loans as well as maturing loans. Because chinas's so-called funds/money/loan cannot be used to pay off anything other than CPEC projects. Pakistan is in a perpetually deep debt sh1t.

 

[RIP Pak LAW]

But you said that previously current account deficit was shrinking because of this?

Bro the current account deficit is shrinking because of the policies of PTI not because of deferred of payments on oil.

PMLN started import spree is so big that oil became small part of imports. This will have no effect rather other PTI policies are helping shrink CAD

I was just confirming whether shrinking of import bill is because of oil deferred payment or not. Glad that it wasn't. Ofcourse current govt policy regarding reducing import bill is very good. Now with this, further decrease in import bill expected infact significant one. But at the end of the day, increase in export is more important.

 

[Awan68]

Don't under estimate Pak economy. In 1971 when Pakistan was dismembered, the economy was in its worst condition. But it recovered in two years. Then after the atomic explosions, Pakistan not only survived despite sanctions, but after couple of years the economic growth was 6% plus.
Pakistan's economy has a resilience or a latent drive, which sometimes conceals itself somewhere, then with a little correction work it recovers itself and then grows at a comfortable rate. This has been happening right from the inception of Pakistan. The mistake Pakistan had committed, was reversal of Z.A. Bhutto's indigenous economic and industrial policies. All the indigenous hard work done during ZAB's era was made ZERO by Zia-ul-Haq's government.
This time, after the correction is done - in about two years - then it will take a year or two to make the economy steady, thereafter it will grow at a faster rate.

Get ur history right mate, all the hard work done from 1947 to Ayub era was made zero by ZAB govt, study his nationalization policy and how it singlehandedly destroyed Pakistans industry.

 

[zeplin_100]

Get ur history right mate, all the hard work done from 1947 to Ayub era was made zero by ZAB govt, study his nationalization policy and how it singlehandedly destroyed Pakistans industry.

First I did not discredit Ayub Khan, second I did not discuss nationalization done by Bhutto, I was discussing recovery of economy after fall of Dhaka till date. From where you think I made history wrong.

I did mention about Bhutto's indigenous economic policies, I standby it. No goverment, in the history of Pakistan worked so hard on indigenous policies, except ZAB's govt. This is a silent chapter of our history, which did not get its due credit. ZAB was not an angel, he committed mistakes too, nationalization was a mistake too, but not in its totality.

Today the mess in which Pakistan is plunged is not because of nationalization, but there are other issues much more than nationalization which has brought to a point where we have to fight for our survival.

 

[Ali_Baba]

The fundamental problem will remain unless Pakistan fixes it. This is just kicking the can down the road.. usual Pakistani trick. Lets see a final solution to this issue.

 

[GumNaam]

Imports bill will be significantly reduced moreover dollar price will decrease as well. Much needed economical stability is expected. Also at the same time, imf loans will start kicking in as well.

Pakistan has not agreed to the imf loan yet, it has only been agreed upon at the secretary level, not finance ministry. so don't hold your breath on imf, may not happen and its probably a good thing!