Pakistan’s economy contracted 0.38% in FY2020 as coronavirus wreaked havoc: Economic Survey

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ISLAMABAD: Advisor to the Prime Minister on Finance Abdul Hafeez Shaikh presented the Pakistan Economic Survey 2019-20 on Thursday, highlighting the state of the Pakistani economy in the outgoing fiscal year. 

Shaikh highlighted the fragile condition of the economy, which was ravaged considerably by the COVID-19 pandemic in the last quarter of the year.

He revealed that the GDP is expected to contract 0.38% in FY 2020 despite 2.67% growth in the agricultural sector, as the industrial and services sectors see growth of -2.64% and -0.59% respectively this year.

Talking about measures taken by the government to arrest ballooning internal and external imbalances, Shaikh praised Prime Minister Imran Khan and army chief Gen Qamar Javed Bajwa for their role in managing expenditures. Noting that the state had cut down its expenditures, he highlighted that at the same time, public spending had been increased. 

Shaikh highlighted that the government did not taken any loans from the State Bank of Pakistan the entire year and did not give any supplementary grant to any department as it wanted to ensure the public’s money was spent carefully. 

The advisor credited the successful policies of the government for an improvement in key indicators, taking note of “a stable exchange rate, healthy growth in FDI (126.8%), improved ranking in World Bank’s ease of doing business index, and ‘Stable’’ credit outlook to B3 from ‘Negative’ by Moodys”.  

The prime minister’s advisor said that the government had returned loans worth Rs5,000bn over the course of the year. He said that Pakistan’s revenue had declined due to a decline in its exports, and that the government had doubled the money for the coronavirus fund despite the economy suffering from setbacks due to the pandemic.