Business

Economic survey shows little improvement

Economic survey 2009-10 showed overall economic improvement in the country, while GDP remained at 4.1 per cent.

Express June 04, 2010

ISLAMABAD: Economic survey 2009-10 showed minimal overall economic improvement in the country, with GDP remaining at 4.1 per cent as declared by Finance Adviser Abdul Hafiz Sheikh in a media briefing on Friday.

The finance minister announced that last year was a difficult year but the steps taken by the government had borne fruit. He also said that there are signs of economic recovery as there was record improvement in remittances from overseas while services sector showed 4.7 per cent growth.

He also said that economic recovery was very fragile in the last fiscal year as the government’s priority was to get out of tough economic times prior to working towards broad based recovery.

He added that electricity prices increased 60 per cent in two years.

Abdul Hafiz said that Pakistan has to focus on developing agricultural stability to follow sustainable GDP.

Economic Survery

The economic survey shows a decline in growth in the agriculture sector in 2010 at 2 percent from almost 4 percent last year.

The Crops sector declined by 0.4 percent, while livestock rose by 4 percent.

Industrial output expanded by almost 5 percent, where Large Scale Manufacturing grew 4.4 percent and Services grew 4.6 percent, compared to 1.6 percent in 2009.

The bulk of the flight of foreign investment took place from Telecom and Financial Services sector.

The finance ministry says in the survey that inflation at home rose mainly due to the rising international commodity prices.

Hafeez Sheikh also said the major factor for the crisis was the global recession, which had a strong impact on the domestic markets.

The economic survey can be viewed at this location.

COMMENTS (5)

Fahad Hasan | 14 years ago | Reply It is unfortunate that a person designated Principal Economic Adviser see this year's growth because of huge transfer to rural areas. The fact is that it was last year when this transfer took place. The nominal growth in crop sector is 13.1 percent and nominal GDP growth is 14.6 percent which implies that rural transfer was less than to the economy. He himself showed a graph to prove the point which incorporates data up to last year. Another factor he mentioned is remittances which is not directly part of the GDP, its only impact is through private investment which depicted negetive growth.How can he say remittance as major cause. This is the worst economic survey I have ever seen. Inflation was discussed in four chapters. WPI and SPI were not discussed even in the Inflation sector. The contributions of major crops rice, sugarcane, wheat and cotton to GDP were wrongly reported. Numerous data mistakes are part of the survey.

Meekal Ahmed | 14 years ago | Reply Not to make light of it, but a debt/GDP ratio of about 59% is not catastrophic. It is manageable. The key is to alleviate the contraints that are holding back growth -- power shortages that are severely disruptive to production and exports, the security situation, and so on. The IMF need not be given "credit" for what growth has been achieved. In the final analysis, this is the government's program that the IMF is endorsing and financing. The government has restored a semblance of macroeocnomic stability and this helps foster growth. It needs to continue on this path. The budget will tell us much about the broad thrust of economic policies going forward. Let us hope the budget will be credible and tight and not take us back to the very dark hole we have just emerged from.

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Nony Mous | 14 years ago | Reply Public debt is 60% of GDP, which we owe to Bankers abroad. Good job professionals.

Aayan Mirza | 14 years ago | Reply I guess the major contribution in this economic growth is of IMF and other loans. i m not saying that there is no government contribution. but it seems like there is very less government contribution in it comparing to IMF and other U.S loans. But after reading the survey it was really funny when i read that U.S who gives us loans is it self in dept of more than 80 Billion Dollars.

Meekal Ahmed | 14 years ago | Reply Inflation rose because of international prices? This is the typical government cop-out. Inflation is also policy-related. Recurring fiscal slippages, too much borrowing from the central bank (injecting "high-powered money" into the economy) and a monetary stance that arguably is not tight enough.

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