‘Macro adjustments to hurt economic growth’

[Shahzaz ud din]

It was announced in 2017 that the PAK GDP would be re based by the end of 2018.Any news about that ?

 

[Hakikat ve Hikmet]

With 70% of the Pak economy undocumented/untaxed/unregulated according to her public accountants and the two-thirds of the earning folks being self employed, all these estimations based on "official" figures reflect little ground realities...

 

[GeraltofRivia]

Well when devaluation (against USD) is higher rate in a year than the total nominal growth (in local currency)...nominal GDP (when measured in USD) will shrink. As measured in PKR, yes it will require much more than devaluation but major internal recessionary pressures (which are unlikely).

I refer you to Indian GDP as measured in current USD in time periods 2007 - 2008 and 2011 - 2013 and compare that with the constant dollar (effective relative inflation indexing rather than following only forex pressure) measure in same time periods:

https://data.worldbank.org/indicator/NY.GDP.MKTP.CD?locations=IN

https://data.worldbank.org/indicator/NY.GDP.MKTP.KD?locations=IN

The inverse (when massive expansion of current dollar measurement compared to constant dollar) also applies to same argument.

I see. The wb data shows Indian GDP in current dollar went 1.20t to 1.18 between 2007 and 2008 and from 1.83t to 1.85t between 2011 and 2013 but the constant dollar version would indicate the growth was 6% per annum for the period.

 

[Nilgiri]

I see. The wb data shows Indian GDP in current dollar went 1.20t to 1.18 between 2007 and 2008 and from 1.83t to 1.85t between 2011 and 2013 but the constant dollar version would indicate the growth was 6% per annum for the period.

Yah so basically nominal depends whether you are measuring in local currency or USD....given this extra conduit of forex scenario dictating the latter (that is not 100% relevant to the domestic side but definitely has importance).

It is lot easier to shrink/stagnate when measured in USD given this....but how relevant that is to the economy of a country (other than US and any others that have USD as legal tender) is different more nuanced matter (and like you said it needs something to go badly wrong to shrink nominal size in local currency).

There is a blip in 2015/16 for China too in current nominal USD measure for example:

https://data.worldbank.org/indicator/NY.GDP.MKTP.CD?locations=CN

and its not present when in constant dollar:

https://data.worldbank.org/indicator/NY.GDP.MKTP.KD?locations=CN