KARACHI: The World Bank has pegged Pakistan’s GDP growth at 2% in 2023, which stood at 6% last year when Imran Khan-led coalition government was in power.
According to Global Economic Prospect Report issued by the World Bank the other day, Pakistan’s economic growth is expected to slow further to two per cent during the current year — down by two percentage points from its June 2022 estimate, owing to devastating floods and slowdown in global growth rate.
The World Bank in its report said Pakistan’s economic output was not only declining itself but also bringing down the regional growth rate. It forecast Pakistan’s GDP growth rate to improve to 3.2pc in 2024, but that too would be lower than the earlier estimate of 4.2pc.
It said Pakistan faces mounting economic difficulties and Sri Lanka remains in crisis. In all regions, improvements in living standards over the half-decade to 2024 are expected to be slower than from 2010-19.
The World Bank, in its sub-titled report “Recent Development” said in Pakistan, an already precarious economic situation, with low foreign exchange reserves and large fiscal and current account deficits, was exacerbated last August by severe flooding, which cost many lives. About one-third of the country’s land area was affected, damaging infrastructure, and directly affecting about 15 percent of the population (Benhassine et al. 2022; World Bank 2022p). Recovery and reconstruction needs are expected to be 1.6 times the FY2022/23 national development budget (Government of Pakistan et al. 2022). The flooding is likely to have seriously damaged agricultural production—which accounts for 23 percent of GDP and 37 percent of employment—by disrupting the current and upcoming planting seasons and pushed between 5.8 and 9 million people into poverty (World Bank 2022p). Policy uncertainty further complicates the economic outlook.
