Pak’s economic condition likely to remain unstable for next two years: WB
WASHINGTON (92 News) – The new report of World Bank warned the Pakistani newly-elected government that economic condition of Pakistan is likely to remain unstable for next two years.
As per report, the World Bank predicted that Pakistan will face severe challenges in coming two years and it needs investment and productivity driven growth, adding that the country will be troubled to create employment and reducing poverty.
The report stated that Pakistan has limited resources but expense are very high. World Bank country director Illango Patchamuthu has said that Pakistan’s growth has to be driven by investment and productivity which will put it on a path to end the boom and bust cycle its economy faces.
“This will create more and better paid jobs and is a reliable path to future economic growth and stability,” director said while commenting on the World Bank’s twice-a-year report Pakistan Development Update.
The report suggested Pakistan needs to address growing fiscal and current account deficits on a sustainable basis for long-term growth. The country’s economic growth accelerated to 5.8 per cent in the 2018 financial year – the highest level in more than a decade, the report said.
The report notes that exports rose, and imports slowed down in the second half of the year due to a more flexible exchange rate. It recommends reduction in trade costs and improvements in the investment climate to enable Pakistan to compete in global markets.
The report acknowledges that the mini budget is a step in the right direction, but for the gains to continue, additional and urgent reforms are required. These include strengthening taxation, improving public finance and increasing spending efficiency. It also makes a case for investing in people.
Meanwhile the report also proposed a number of structural reforms in various sectors including Pakistan’s revenue sector. “Revenue as a share of GDP continues to be very low and a large share of the revenue is generated through indirect taxation,” it said.