Outlook is not promising: Economic Survey 2019/2020

Outlook is not promising: Economic Survey 2019/2020

ISLAMABAD: The economic outlook is not very clear as well as doesn’t seem promising as COVID may dampen exports demand besides expectations of capital flight, according to the Pakistan Economic Survey 2019/2020 released on Thursday.

It said that as economies reopen with expectations that the adverse impact of COVID-19 is bottoming out, there is an on-going debate over the shape of the Recovery.

Investors have fears about decline in economic growth and business profits due to a decrease in demand.

Further, still, restriction on imports in many countries may dampen demand for Pakistan’s exports.

Capital flight is also expected with prevailing uncertainty and vulnerabilities, thus putting pressure on the exchange rate.

“The economic outlook is not very clear as well as doesn’t seem promising, however, the fiscal stimulus package of Rs 1.24 trillion along with measures taken by State Bank of Pakistan for providing liquidity support to households and businesses will counteract the current economic downturn.”

IMFs Rapid Financing Instrument (RFI) amounting to $1.386 billion to counter the economic impacts of this novel outbreak will also support the government’s efforts to mitigate the economic shock, the facility will be used to address declining international reserves and increase social sector spending.

Additionally, concessionary lending by IFIs; the World Bank and Asian Development Bank will provide much needed support to the government during this crisis time and help the Government of Pakistan to weather the COVID-19 Challenge with minimum effects.

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