IMF revises up Pakistan's 2016/2017 growth forecast to 5 percent

[farhan_9909]

The International Monetary Fund (IMF) on Tuesday increased to 5 percent its forecast for Pakistan's growth in the fiscal year to June 2017, from a previous estimate of 4.7 percent, citing China's plans to invest in road and energy infrastructure.

In September, Pakistan will end a three-year $6.7-billion financial assistance programme from the IMF, after the economy recovered from a series of financial crises, with growth at an eight-year high and increased foreign exchange reserves.

Fund officials say Pakistan has met all performance criteria for the assistance programme but urged Islamabad to keep tackling structural reforms to further increase growth and make it more inclusive.

"Growth is expected to strengthen to 5 percent in FY 2016/17, supported in part by an expected pick-up of investment related to the China Pakistan Economic Corridor (CPEC)," the fund said in a report.

The $46-billion CPEC project will focus on road building and energy infrastructure to end chronic power shortages in Pakistan. A highway is expected to link Western China with the port of Gwadar port on the Arabian Sea.

Fund officials say Pakistan's economy is likely to have grown 4.7 percent in the fiscal year to June 2016, a touch higher than their May estimate of 4.5 percent.

"Inflation is expected to remain contained at 5.2 percent in FY 2016/17, well-anchored by prudent monetary policy," the IMF added.

The IMF said Pakistan had also sought a four-week extension to the loan programme from Sept 3 to Sept 30 to "allow sufficient time to conduct discussions for the final review". It added Pakistan was in strong position to repay the IMF.

"Pakistan’s financing needs are fully covered for the remainder of the program and the country’s capacity to repay the Fund remains strong owing to supportive macroeconomic policies, resilient remittances inflows, and increasing foreign exchange reserves," the IMF said.

http://in.reuters.com/article/pakistan-imf-idINKCN0ZL1JH

 

[Nilgiri]

Good news.

The investment rate is expected to pick up to 17% from the stagnant 14 - 15% it has been lately :

http://www.imf.org/external/pubs/ft...t=country&ds=.&br=1&c=564&s=NID_NGDP&grp=0&a=

If Pakistan can get this investment rate even higher than IMF predicts, it can reach a lot more than 5% growth.

It should be striving to get it well past 20% and even 30%...that is the area India (33%), Bangladesh (30%), Myanmar (24%) and others are at right now to get sustainable growth in 6% - 7%+ region over a sustained amount of time.

 

[A.M.]

There is irrefutable evidence that the economy is doing better and will only improve further once the electricity shortages start to abide.

My biggest fear with Pakistan in recent years has been the inclination of opposition parties to seek an overthrow of existing government. Stability is one of the biggest driving forces for growth and is something needed to sustain growth.

Whether you like the current government or not, you have to let it finish it's term in a stable manner. That is the only way this growth will remain consistent.

 

[Cyberian]

A lot of positive news is coming through on the economy for Pakistan on daily basis, I pray the momentum picks up.

 

[CHD]

Its 7% if you somehow just overcome all the energy shortage to the industry

 

[Nilgiri]

Its 7% if you somehow just overcome all the energy shortage to the industry

That (7%) cannot be sustained without a massive increase in investment rate.

 

[Tiger Genie]

Its 7% if you somehow just overcome all the energy shortage to the industry

may be but there are even more effective ways : for example 1) accomplish political stability by pushing military to barracks - add 3% solid to growth; 2) truly go against terrorism - add solid 7% to growth.

With so much pent up, just these two will make Pakistan a 15 to 18% growing tiger economy.

 

[CHD]

may be but there are even more effective ways : for example 1) accomplish political stability by pushing military to barracks - add 3% solid to growth; 2) truly go against terrorism - add solid 7% to growth.

With so much pent up, just these two will make Pakistan a 15 to 18% growing tiger economy.

Dont mistake Zardari and Nawaz corruption with those of indian ones, they are corrupt on a whole new level and in addition to that they niether have the vision or ability to lead a country of 200 million.
Army is never going to take charge again, they have finally understood that world dont appreciate dealing with dictators, But they are needed for the forseable future to keep a check on corrupt politicians as you can see from Karachi operations with with so many billions bieng recovered and politicians fleeing abroad.
The chinese would never have commited 46 billion if thier was no assurance from the army.
Never in a million years

 

[Baidar Bakht]

may be but there are even more effective ways : for example 1) accomplish political stability by pushing military to barracks - add 3% solid to growth; 2) truly go against terrorism - add solid 7% to growth.

With so much pent up, just these two will make Pakistan a 15 to 18% growing tiger economy.

whether we like it or not Army plays an important role in Pak's politics, there have been good times and bad times in Pak's history and I am pretty sure if Army was not this strong Pak would have been a totally failed state(if it was alive at the first place) because of our selfish politicians. IMO Army should not give up its power until we get loyal politicians.

BTW 3% growth from pushing army back to barracks? totally wrong. You have no idea how Pak works.
and 7% growth from really eliminating terrorism? ahaan?? why dont you stop supporting anti Pak factions so we can get this 7% increse in our growth? reality is Pak is going hard against terrorism, and yes it will help our growth by a huge margin but not by 7%.

STOP watching India media, ITS NOT GOOD.

IMO WE JUST NEED TO GET RID OF THE TERRORISM AND ELECTRICITY SHORTAGE AND WE CAN HIT 7% easily.

 

[HttpError]

There is irrefutable evidence that the economy is doing better and will only improve further once the electricity shortages start to abide.

My biggest fear with Pakistan in recent years has been the inclination of opposition parties to seek an overthrow of existing government. Stability is one of the biggest driving forces for growth and is something needed to sustain growth.

Whether you like the current government or not, you have to let it finish it's term in a stable manner. That is the only way this growth will remain consistent.

Despite how much we dislike current government. Certainly PML N is no saint and corruption is deep rooted with in their and every other political party in Pakistan with that being said PML N should complete their term they have certainly brought stability and improved economy but who will tell this to IK and group.

 

[Tiger Genie]

Dont mistake Zardari and Nawaz corruption with those of indian ones, they are corrupt on a whole new level and in addition to that they niether have the vision or ability to lead a country of 200 million.
Army is never going to take charge again, they have finally understood that world dont appreciate dealing with dictators, But they are needed for the forseable future to keep a check on corrupt politicians as you can see from Karachi operations with with so many billions bieng recovered and politicians fleeing abroad.
The chinese would never have commited 46 billion if thier was no assurance from the army.
Never in a million years

Agreed on all points you make ...BUT, consider this:

* status quo means victory for the negative forces in Pakistan. You have to grow MUCH faster to wean youth away from those evil influences
* military has understood......and has become cleverer and nuanaced. Instead of putting ramboloons such as musharaf and zia, now they put softshelled ones who dictate from the rear. See how clever the current coup has been ...that only makes them even more dangerous as now they have better understood media management, are able to better control the mullahs and are lot more discreet about land grabs

A 5% growth in a 5.5% inflation economy (without full debt service) is at best damage control

whether we like it or not Army plays an important role in Pak's politics, there have been good times and bad times in Pak's history and I am pretty sure if Army was not this strong Pak would have been a totally failed state(if it was alive at the first place) because of our selfish politicians. IMO Army should not give up its power until we get loyal politicians.

BTW 3% growth from pushing army back to barracks? totally wrong. You have no idea how Pak works.
and 7% growth from really eliminating terrorism? ahaan?? why dont you stop supporting anti Pak factions so we can get this 7% increse in our growth? reality is Pak is going hard against terrorism, and yes it will help our growth by a huge margin but not by 7%.

STOP watching India media, ITS NOT GOOD.

IMO WE JUST NEED TO GET RID OF THE TERRORISM AND ELECTRICITY SHORTAGE AND WE CAN HIT 7% easily.

You scream towards the end that you have to get rid of terrorism to grow yet bury you head in the sand pile and repeat the nonsense about someone from outside causing it! The large chunk of your madrassah, numerous lashkars and the history of innumerable suicide bombers clearly prove your terrorism is your own Frankenstein monster. Face it lest fail for it!

 

[touela]

Despite how much we dislike current government. Certainly PML N is no saint and corruption is deep rooted with in their and every other political party in Pakistan with that being said PML N should complete their term they have certainly brought stability and improved economy but who will tell this to IK and group.

IMO I wouldn't praise PML N that much for improved economical situation. I think China would have "forced" any current government of Pakistan to make sure their $46 bln is not wasted in any way. PML N is just doing what China have forced upon them, nothing more.

 

[Baidar Bakht]

Agreed on all points you make ...BUT, consider this:

* status quo means victory for the negative forces in Pakistan. You have to grow MUCH faster to wean youth away from those evil influences
* military has understood......and has become cleverer and nuanaced. Instead of putting ramboloons such as musharaf and zia, now they put softshelled ones who dictate from the rear. See how clever the current coup has been ...that only makes them even more dangerous as now they have better understood media management, are able to better control the mullahs and are lot more discreet about land grabs

A 5% growth in a 5.5% inflation economy (without full debt service) is at best damage control



You scream towards the end that you have to get rid of terrorism to grow yet bury you head in the sand pile and repeat the nonsense about someone from outside causing it! The large chunk of your madrassah, numerous lashkars and the history of innumerable suicide bombers clearly prove your terrorism is your own Frankenstein monster. Face it lest fail for it!

I am talking about the terrorism sponsored by foreign sources to create mess for Pak. You are dumb to believe that TTP and BLA etc are mess created by our ownselves. Without the foreign involvement such factions cant survive.

and as far as the terrorists that you are concerned about matter, I am not going to comment on that as you wont believe in me.

 

[That Guy]

Good news.

The investment rate is expected to pick up to 17% from the stagnant 14 - 15% it has been lately :

http://www.imf.org/external/pubs/ft...t=country&ds=.&br=1&c=564&s=NID_NGDP&grp=0&a=

If Pakistan can get this investment rate even higher than IMF predicts, it can reach a lot more than 5% growth.

It should be striving to get it well past 20% and even 30%...that is the area India (33%), Bangladesh (30%), Myanmar (24%) and others are at right now to get sustainable growth in 6% - 7%+ region over a sustained amount of time.

I personally think Pakistan won't reach 6% before the next five years, though that isn't necessarily a bad thing. Pakistan's priorities are to stabilize the economy fully, which it is still in the process of doing; Once stabilization is complete, it can concentrate on sustained growth.

As for investment rate, I don't think it'll reach 20% any time soon; While nations like Turkey and China are increasing investment, it barely covers the loss of the money flowing outwards, mainly by the US and UAE.

In fact, I have a hard time believing the 17% figure given.

 

[farhan_9909]

I remember when in 2013 the 2nd loan program started,Dar said this program is for the stability of Pakistan Economy and not the growth but this year he said this project is economic growth oriented.

I agree we won't be able to achieve 5.7% for this year but 5.5% is possible.