UN survey report projects economic upturn in Pakistan

ISLAMABAD: The United Nations has released an economic survey predicting an acceleration in Pakistan’s economic growth and a potential decrease in inflation.

According to the UN economic survey, Pakistan’s economic growth is accelerating in the fiscal year 2024-25, with a real growth rate expected to increase by more than 2 per cent in the next fiscal year, while the inflation rate is likely to decrease from 26 per cent to 12.2 per cent in fiscal year 2025.

The survey states that political instability has affected economic growth, business, and citizens, with agricultural production and the economy impacted by the floods of 2022. However, the economy began to stabilize in 2023 with an agreement with the IMF and assistance from friendly countries.

Further, the economic survey mentions that the elimination of subsidies in the energy sector and fiscal discipline have started to bring economic stability, noting that the tax rate relative to GDP is low.

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The survey highlights that developing countries in the Asia Pacific region need appropriate and long-term resources. These countries face a choice between spending on repaying past debts incurred at high interest rates or allocating resources for the education, health, and social betterment of their people.

Previous reports by the World Bank and Bloomberg confirmed signs of economic stability in Pakistan, indicating an increase in the growth rate and the start of economic progress. The growth rate is expected to double in the coming fiscal year, with a gradual increase, and an 11 per cent reduction in inflation is anticipated for the next fiscal year.

Additionally, according to Bloomberg, the Financial Times Stock Exchange has maintained Pakistan’s status as a secondary emerging market for six months. Bloomberg states that the new government of Pakistan is led by reform-friendly Prime Minister Shehbaz Sharif.