LAHORE – Pakistan’s external account woes will continue to worsen despitethe steep decline in oil prices, the Fitch Rating research agency has said.
The export will likely come under pressure due to a global trade slowdownand it believes a major non-oil import contraction is looking increasinglypossible.
According to the report, this would negatively influence Pakistan’seconomic growth over the coming quarters and it maintained the real GDPgrowth forecast at 4.4% for the current financial year 2018-19, despite thewindfall from oil import savings.Image: Fitch Solutions
Fitch Solution said the plunge in oil prices which commenced in Octoberhadn’t yet been reflected in an improvement in Pakistan’s trade accounts.
The research agency highlighted that besides a meagre fall in Pakistan’soil import bill, trade deficit clocked in at Rs371.6 billion in November,showing a slight improvement over the October figure and staying nearrecord highs.
Similarly, foreign exchange reserves plummeted to their lowest sinceNovember 2014, touching just $9 billion, which equates to less than twomonths of import cover.