Featured Pakistan’s Current Account Records First Quarterly Surplus in Over 5 Years: SBP

[Morpheus]

Pakistan’s Current Account Records First Quarterly Surplus in Over 5 Years: SBP

Posted 28 mins ago by ProPK Staff

The current account maintained a surplus in the third straight month with a huge surplus of $792 million during the first quarter of the current financial year 2020-21 mainly on the healthy inflows of remittances and control over import bill.
According to the State Bank of Pakistan, this is the first quarterly surplus in more than five years.

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This is indeed a record that the current account retained its surplus-value for a quarter of the financial year.
According to data updated by the State Bank of Pakistan, the country reported a surplus of $73 million in September, and $211 million (revised figure) in August, and $508 million (revised figures) in the month of July. The surplus-value of September fell significantly.
A.A.H Soomro, managing director at Khadim Ali Shah Bukhari Securities told ProPakistani,

The surplus is backed by supernormal growth in remittances, which would moderate. The import bill ought to increase due to monetary easing led demand & energy imports. Exports growth is not so impressive. That needs to go touch double digits.

Last year, the country recorded a deficit of $1.49 billion in the same period of the first quarter of FY20. The handsome surplus of the current account shows stability in external accounts backed by the various measures of the economic managers of the present government. The improvement in the trade bill and the handsome inflows of the remittances contributed to the surplus-value of the current account during the first two months of the current financial year.

The import of goods reduced to $10.6 billion from $11.03 billion and the import of services also decreased to $1.76 billion from $2.39 billion by the end of the first quarter of FY21. The reduction of imports bill also supported the balance of payment of the country to contain the deficit position.

Meanwhile, the export of goods stood at $5.35 billion versus $5.98 billion last year, and services stood at $1.22 billion compared to $1.29 billion. The exports declined on a year-o-year basis however they slightly picked up on a month-to-month basis as the economic activities are being restored globally and locally.
Remittance inflows, on the other hand, reached an all-time high level of $7.14 billion in the said period showing a year-on-year growth of 31%, which ultimately turned the current account into surplus.
Prime Minister Imran Khan on Wednesday said that Pakistan is headed in the right direction finally as the current account was in surplus of $73 million in September.

The premier took to Twitter and said the surplus for the first quarter was brought to $792 million as compared to the deficit of $1,492 million during the same time last year.


It is expected that imports and exports of goods and services may witness a gradual growth in months to come through as the government should focus to contain the import bill and enhance exports along with remittances to maintain the positive trend of current account surplus, which is indeed a herculean task.
Due to the huge value of surplus, it is likely the current account will remain in surplus for the next couple of months whereas on a month-to-month basis it may go into deficit.

Pakistan's Current Account Records First Quarterly Surplus in Over 5 Years: SBP

The current account maintained a surplus in the third straight month with a huge surplus of $792 million during the

propakistani.pk

 

[Syed1.]

Well done to Imran Khan and his economic team.


Sadly our awaam is so jahil, even certain "senior moderators" on this forum aren't capable enough to process such news. Pakistanis deserve to be ruled by ganwaars like Nawaz Sharif.

 

[IceCold]

We are registering surplus here and some brain damage idiots are questioning PTI performance on economy. Lol

 

[Syed1.]

We are registering surplus here and some brain damage idiots are questioning PTI performance on economy. Lol

IK did talk about the rampant stunted growth in the nation, in his very first address. I think he was holding up the picture of some of the posters on here.

 

[N.Siddiqui]

Well done to Imran Khan and his economic team.


Sadly our awaam is so jahil, even certain "senior moderators" on this forum aren't capable enough to process such news. Pakistanis deserve to be ruled by ganwaars like Nawaz Sharif.

People here are not into it and they don't know how the fiscal deficit was impacting the individual life and of millions of people.

And a fiscal deficit of 22-24 billion USD per year turned into a surplus of close to 3.00 billion USD is a bigger achievement than a 8-15 USD higher GDP than say India., considering the 1st quarter surplus at 792 million USD...

Now Pakistan has lots of fiscal space to maneuver around.












‘Heading in the right direction’: Pakistan sees record 1Q current account surplus
Fayaz Hussain 21 Oct 2020
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Prime Minister Imran Khan on Wednesday said the country was "headed in the right direction finally" as the country’s current account witnessed a record surplus of $792 million in the first quarter of the current fiscal year. — APP/File
Prime Minister Imran Khan on Wednesday said Pakistan was “headed in the right direction finally” as the country’s current account witnessed a record surplus of $792 million in the first quarter of the current fiscal year, data released by the State Bank of Pakistan (SBP) showed.
The surplus came on the back of an upward trend in remittances and month-on-month increase in exports during September, according to the central bank.
Current account surplus in the month of September clocked in at $73m, down 65.4pc from $211m in August, mainly on account of the widening trade deficit during the month under review.
“Great news for Pakistan. We are headed in [the] right direction finally. Current Account was in surplus of $73m during September, bringing [the] surplus for 1st qtr to $792 mn compared to [a] deficit of $1,492 mn during [the] same time last year. Exports grew 29pc and remittances grew 9pc over previous month,” said Prime Minister Imran Khan on Twitter.


The SBP said in September, the current account posted a surplus for a third consecutive month in a row.
“The surplus reached $73m [in September] against a deficit of $278m a year earlier. As a result, the current account recorded a surplus of $792m in 1QFY21, the first quarterly surplus in more than five years. Continued buoyancy in remittances (up 9pc m/m) and a broad-based rebound in exports (up 29pc m/m) drove the current account surplus in September. Imports also picked up in line with the on-going revival in domestic economic activity,” it added.
The month-on-month decrease in the current account surplus came as a result of an 8pc increase in the trade deficit in September, the central bank said. Pakistan's trade deficit in September rose to $1.82 billion compared to $1.727bn in August on account of 62pc and 21pc jump in food and machinery imports, respectively.
In September, balance of trade in goods deteriorated by $140m, up 8pc month on month on the back of increase in imports of goods by $581m or 18pc month-on-month, whereas exports of goods improved by $441m — up 29pc from August, said Chief Economist at Topline Securities Syed Atif Zafar while speaking to Dawn.
He said that the balance on primary income also deteriorated by $197m or 61pc over the previous month, however, an increase in remittances by $189mn or 9pc helped cushion its impact.
“Looking forward, we expect the current account deficit to clock in at $2.5-3bn in FY21 (1.0-1.2pc of the GDP) as Covid-19 related lockdowns and restrictions ease globally and international oil prices also trend up,” he added further.

‘Heading in the right direction’: Pakistan sees record 1Q current account surplus

Central bank says this is the first time in over 5 years that Pakistan has recorded a quarterly surplus on its current account.

www.dawn.com

 

[IceCold]

People here are not into it and they don't know how the fiscal deficit was impacting the individual life and of millions of people.

And a fiscal deficit of 22-24 billion USD per year turned into a surplus of close to 3.00 billion USD is a bigger achievement than a 8-15 USD higher GDP than say India., considering the 1st quarter surplus at 792 million USD...

Now Pakistan has lots of fiscal space to maneuver around.

Even the educated ones lack common sense. On top we have the so called media experts, BA journalism pass ker ka economy per remarks da raha hota hain.
There should be some law that non qualified people will not speak on subject matters they have zero knowledge about
Idar jis ko dekho expert bana hua ha.

 

[wali87]

This surplus is meaningless. The only reason the government has s CA surplus is because they didn’t make any interest or loan payments this year. Wait till next year you will note a much higher CA deficit than ever. I feel sorry for the poor idiots who buy this manipulation of numbers. The reality on ground in Pakistan is worst than ganja and chor zardari’s tenure combined. The truth is no matter how this government twists facts and words, it has lost all credibility along with 80% of the public support it enjoyed before elections. Those who have a hard time processing this will find this out very soon.

 

[Syed1.]

Heartening to note that there was a higher trade deficit in September not the back of imported cheese, water and cosmetics as was happening during the Noony Tunes era, but due to 62% increase in food import (to curb inflation) and 21% increase in machinery import (good signs for industrialization).

 

[IceCold]

I still think that by the end of the fiscal year, overall Current Account would be negative but only 1-2b. Not the 20b left by Noony Tunes who have widespread support in the media and amongst PDF posters and a certain "Senior Moderator".

If the direction is right 1-2 billion is negligible. It all comes down to managing and starting to live within ones means which is what Khan's government initially said that we cannot live like this anymore. People dont want to pay taxes yet want to enjoy all benefits, hide income, submit null returns, and than complain cheezen kyn mangi ho rahi hain?
The jahils complain woh dekhin dollar kahan sa kahan challa gaya. Oh bhai dollar ko necha rakh ker kya kerna ha, you are only making your exports expensive. Just look at Thailand and how they are worried on their expensive exports due to strong Bhatt. I gave a similar example to another jahil that if weak currency is such a bad thing why is Japan and South Korea flourishing. Their currencies were weaker than rupee at one point during Zardari tenure.

 

[ziaulislam]

Ultimately only two things matter for common public
Inflation and growth..

Uneducated people dont understand the reasons behind this and how the previous govt caused the current inflation

And educated people are too biased and will bluntly lie for their political parties..


But never the less good development whicj will stablize tje economy till 2028 when maryum or bilawal will run down again..

Who knows it might be sooner

 

[IceCold]

This surplus is meaningless. The only reason the government has s CA surplus is because they didn’t make any interest or loan payments this year. Wait till next year you will note a much higher CA deficit than ever. I feel sorry for the poor idiots who buy this manipulation of numbers. The reality on ground in Pakistan is worst than ganja and chor zardari’s tenure combined. The truth is no matter how this government twists facts and words, it has lost all credibility along with 80% of the public support it enjoyed before elections. Those who have a hard time processing this will find this out very soon.

So surplus is meaningless while deficit was a good thing.
Nice logic.
By the way this isnt pti manipulating numbers, international agencies are also saying on similar lines. They must also be on PTI payroll.
And talking about being worst than nawaz and zardari lol like drone attacks, memogate, obl raid, sahala check post attack, APS attack happened in the time of PTI.
Seriously kuch thori sa sharam ker lo. Nothing was more black than the combined 10 years of these two leaches.

 

[wali87]

Sharam kar lo? I could say the same to you but that would put me at your level. So have some respect when speaking to other people irrespective of your political inclinations.

Anyhow, the reason you have no idea about the insane economic situation on ground is because either you don’t live in Pakistan or you don’t work in Pakistan. Go do a fact check on the current GDP to Loan ratio and the increasing per day borrowing.
If you lived here, you’d realise that the way ordinary people used to abuse the Ganja bros and thug zardari was nothing compared what their emotions are towards Imran Khan today. It’s sad because like them, I too for once, thought that things will go in the right direction this time.
Don’t take my word for it tho, just wait till the next elections.

So surplus is meaningless while deficit was a good thing.
Nice logic.
By the way this isnt pti manipulating numbers, international agencies are also saying on similar lines. They must also be on PTI payroll.
And talking about being worst than nawaz and zardari lol like drone attacks, memogate, obl raid, sahala check post attack, APS attack happened in the time of PTI.
Seriously kuch thori sa sharam ker lo. Nothing was more black than the combined 10 years of these two leaches.

 

[IceCold]

Sharam kar lo? I could say the same to you but that would put me at your level. So have some respect when speaking to other people irrespective of your political inclinations.

Anyhow, the reason you have no idea about the insane economic situation on ground is because either you don’t live in Pakistan or you don’t work in Pakistan. Go do a fact check on the current GDP to Loan ratio and the increasing per day borrowing.
If you lived here, you’d realise that the way ordinary people used to abuse the Ganja bros and thug zardari was nothing compared what their emotions are towards Imran Khan today. It’s sad because like them, I too for once, thought that things will go in the right direction this time.

My level? First update your knowledge to be at my level. As for sharam, people like you need to be exposed for who they are, lying to their teeth defending corruption and nepotism. I am very open to a healthy debate but that does not happen with people who give examples of Nawaz and Zardaris as shining ones.
As for me living here, i live in Lahore, i work here, so again very judgemental of you to believe i am not living in Pakistan. Like i said we are not blind supporters but know when to call spade a spade.

 

[wali87]

My level? First update your knowledge to be at my level. As for sharam, people like you need to be exposed for who they are, lying to their teeth defending corruption and nepotism. I am very open to a healthy debate but that does not happen with people who give examples of Nawaz and Zardaris as shining ones.
As for me living here, i live in Lahore, i work here, so again very judgemental of you to believe i am not living in Pakistan. Like i said we are not blind supporters but know when to call spade a spade.

No way your living in Lahore. Stop pretending that you are. If you had an sense of comprehension, you’d realise that I never mention Nawaz and zardari as shining. I merely compared the facts between the three tenures.

But anyhow, I understand you psychological level more than you know. There’s no point arguing with a mentally blind person. As for calling a spade a spade, my dear as per your language and political understanding, it ll take you another 10 years to first understand what a spade is.
Infact it’s keyboard warriors such as yourself that are spreading fake propaganda about what is actually happening in Pakistan economically. Try talking to any single business owner or a working person in Lahore and you ll get a not so polite response.
But then again, judging from your views, you’d lie about that as well. So like I mentioned earlier no point arguing with your type of people, who are so blinded by their views that they ll never learn anything new or current.

 

[Unite & Defend]

Kudos to the Gov for their ongoing efforts to stabilise the economy.

Saying that I would like to see a concerted drive to grow enterprise startups - with national credit score mechanism set up to assess the creditworthiness of individuals. Furthermore, with CPEC moving nicely; lenders should now relax their lending criteria for both personal and business applicants.

And we need more Chinese expertise in startup creation - in both-ends of the spectrum (strategic consulting and at high Gov level).