Pakistan reports massive current account surplus of $654mn in March

[Enigma SIG]

I can save a lot too by doing only 1 meal a day, not using my car, cutting internet expenses, only using electricity 1 hour pwrller day.

 

[Bilal.]

It was positive during COVID only when everything was closed down.
Even when we import raw materials local demand is so high that finished products don't get re exported but get consumed locally hence the gap

The export growth numbers are there, when we check those it shows very significant growth, same for remittances. So the CAD surplus then cannot be explained away just by COVID closure.

 

[SD 10]

PTI also ran the surplus when industry was shut down
The minute they opened up current account went into historic deficit.

Key to pak economy is to manage to go into growth without going into deficit

Unique Issue here I think is low tax base and undocumented wealth leads to insatiable demand for imported goods minute u open up the economy

You cant make ration for economy, it might work if we dont have to pay so much debt but at the moment you need sustainable 7% growth rate just to make sure that you dont default on your loans!

 

[HAIDER]

Govt is not cashing checks, hold on all raw material imports, LCs are on hold...... another artificial act for IMF loan .... PDM govt extremely dangerous move .

Surplus used to be something to cherish when it happened in PTI tenure

Now everyone in Pakistani say PTI govt was doing excellent job. No shortage of anything, even after COVID19.

 

[Mrc]

The export growth numbers are there, when we check those it shows very significant growth, same for remittances. So the CAD surplus then cannot be explained away just by COVID closure.

Boss when you achieved 3 billion exports your imports those months were touching 8 billion , with around 3 billion covered by remittance and 2 billion deficit that was also unsustainable.

Check cad in PTI last 12 months

 

[Bilal.]

Boss when you achieved 3 billion exports your imports those months were touching 8 billion , with around 3 billion covered by remittance and 2 billion deficit that was also unsustainable.

Check cad in PTI last 12 months

Last 12 month included abnormal high energy and commodity price spike. It cannot be taken as normal indication brother.

 

[ziaulislam]

If this is real I am very happy!

That coal production is half since they can't remit dollars

What's the point of surplus if everything is stopped to halt

Taliban apparently are running a surplus too so is north korea

Regardless there is no way we can pay off large loans unless China or use intervnue and those are rolled over

A year ago that wouldn't have been an issue but default risk going from 5 to 95% and three grade drop in rating (never happened in Pakistan history)

Boss when you achieved 3 billion exports your imports those months were touching 8 billion , with around 3 billion covered by remittance and 2 billion deficit that was also unsustainable.

Check cad in PTI last 12 months

For today oil prices the CAD would have been well within 2% deficit and sustainable

 

[migflug]

Import substitution is the need of the hour. Can't outmanuver out of that one.

Its good news that its a surplus but the current economic state is unsustainable. To get out GoP needs more resources, even more so to comfortably avoid such reoccurences. As debt servicing eats away at national resources there is a risk of falling deeper into the debt trap. Debt restructuring would be your best bet, liberalise the economy, the pain is being felt anyways, might as well bite the bullet for the long term gain and stability.

In the short term Karachi port needs to be expanded and modernized to increase efficiency and decrease delays. Its being over utilised anyways, additional funds would see infusion of jobs and improved export capabilities. Gwadar will take time to come online, till then it would have to be funded by the tax payer. To increase synergies, your geographic position also acts as a helpfull bonus.

The north south orientation of Pakistans populace means fewer lines with high capacity capability will be sufficient. Makes it easier to place industry and GoP can tap into her lower labour costs and pair it with optimised logistical network. Every cent saved would count and help GoP be a bit more competitive in the global market.

True that. Pakistan is bit like Egypt in that sense geographically and has a good advantage in the sense that it can plan its entire development around Indus without having to expand in different directions. Just few high capacity railway lines, expressways and waterways near Indus can easily reduce logistic cost significantly. But the caveat would be the insane high land acquisition cost because of pop density, but over time the payoff would be rewarding.

 

[Mr.JoJI]

Here is my unbiased nonpolitical assessment.

The CAD does matter a lot here but the way we are achieving it is really bad for the economy in the long run.

Aka: We buy a lot of energy and raw materials to produce goods that are used for exports and internal consumption.
The problem is the international market for our biggest export is strangling due to global inflation and the rising cost of production and competitors.
At the same time, we are buying a lot of imports that are very expensive. If things run like this we will have to cut down all necessary imports to produce a $'s worth of export. The equation is already killing our local business and investment.

We need to force our local industries to export whether it's ceramic, tiles, artisanal work, or any shit. We also need heavy investment into sustainable energy like electric transport, solar, and wind energy.


Here is my suggestion:
1. Privatize all the energy sector and force laws to make them lower energy losses.
2. Make road plans for green energy.
3. Promote and facilitate public rooftop solar systems.
4. Slowdown housing industry using taxations
5. Develop a national program for promoting every local industry to export.
6. Get PBC to access products that are made in Pakistan and how much they can be sold in the international market.
7. Train local manufacturers about selling goods on international e-commerce forums.

 

[Mrc]

Here is my unbiased nonpolitical assessment.

The CAD does matter a lot here but the way we are achieving it is really bad for the economy in the long run.

Aka: We buy a lot of energy and raw materials to produce goods that are used for exports and internal consumption.
The problem is the international market for our biggest export is strangling due to global inflation and the rising cost of production and competitors.
At the same time, we are buying a lot of imports that are very expensive. If things run like this we will have to cut down all necessary imports to produce a $'s worth of export. The equation is already killing our local business and investment.

We need to force our local industries to export whether it's ceramic, tiles, artisanal work, or any shit. We also need heavy investment into sustainable energy like electric transport, solar, and wind energy.


Here is my suggestion:
1. Privatize all the energy sector and force laws to make them lower energy losses.
2. Make road plans for green energy.
3. Promote and facilitate public rooftop solar systems.
4. Slowdown housing industry using taxations
5. Develop a national program for promoting every local industry to export.
6. Get PBC to access products that are made in Pakistan and how much they can be sold in the international market.
7. Train local manufacturers about selling goods on international e-commerce forums.

For Pakistan it's the most important thing as it's what forces us to go to imf

Every country is different and problem starts when you apply Western solutions to Pakistani problems

For me I would try to sustain a positive current account and jiggle up economy sector by sector starting with export orientated ones. Go slow . Sustain first

 

[Zibago]

Those who believe in figures doled out by Mr. Ishaq Dar

SAY AYE

Tangein kat kar kaha ja raha hy height choti ho gayi congratulations

Unwelcome surplus

The current account posted a surprise surplus of $654 million in Mar-23 – highest monthly surplus in eight years....

www.brecorder.com

For Pakistan it's the most important thing as it's what forces us to go to imf

Every country is different and problem starts when you apply Western solutions to Pakistani problems

For me I would try to sustain a positive current account and jiggle up economy sector by sector starting with export orientated ones. Go slow . Sustain first

The incentives to many export oriented industries have ended and textile sector is expecting mass closures and layoffs

Seeing some comments on this thread, people still fail to see the bigger picture. You choke the economy to get surplus; no economist worth his salt would praise this.

Mass layoffs, shortages of goods, exodus of international companies and Pakistan becoming a hostile country for investors

 

[Zibago]

Banks running out of local currency? Time to panic..

First time this eid we couldnt get fresh notes from banks har jagah shortage thi

Many car parts are now being smuggled in at 3 times the price due to ban on import LC

 

[ARMalik]

While India is doing this and earning good Euros and Dollars, the GHQ hyenas are kidnapping Pakistan people and their kids, and illegally occupy Pakistani people's lands to build illegal DHAs. Remember, during IK's tenure these disgusting Hyenas had the opportunity to buy cheap Russian oil and do exactly the same as India, but instead they chose to lick US hind side and waggle their tails like good little puppies.

https://twitter.com/x/status/1652532291581915137