Pakistan's economy to fall in 2015 as South Asian economies strengthen: UN forecast
The report forecasts that Pakistan's economic growth to fall slightly in 2015, but pick up again in 2016
A worker arranges spools of thread at a textile factory in Karachi, Pakistan. PHOTO: AFP
South Asian economies are expected to grow by 5.4% in 2015, a four-year high, a report published by the Department of Economic and Social Affairs (DESA) of the United Nations (UN) on Monday. However, Pakistan's economy is expected to fall during 2015.
This is 0.5% above the estimated 4.9% growth rate in 2014. The report forecasts a further acceleration to 5.7% growth rate in 2016.
India, which accounts for approximately 70% of South Asia’s economic output, will lead the economic recovery, while Bangladesh and Iran are also expected to see strong growth. The report notes that there will be “robust external demand” but also “moderate strengthening of domestic consumption and investment” as several countries benefit from improved macroeconomic conditions.
The report also noted that governments in the region have made progress at implementing economic policy reforms, thereby boosting consumer and business confidence.
Pakistan's progress
Due to the precarious security situation in the country, and low fixed investment, the report said, “macroeconomic fundamentals remain fragile” in Pakistan, in spite of the GDP rebounding to an estimated 4.2% in 2014 after robust private and public consumption.
The report forecasts economic growth to fall slightly in 2015, but pick up again in 2016.
In Pakistan, India, Iran and Sri Lanka, unemployment rates remained significantly higher for women, while the share of vulnerable employment, which is defined as unpaid family workers and own-account workers, was 60% in Pakistan and 80% in India.
“This illustrates the magnitude of the employment challenges the region is facing and highlights the importance of generating quality employment,” the report said.
This is 0.5% above the estimated 4.9% growth rate in 2014. The report forecasts a further acceleration to 5.7% growth rate in 2016.
India, which accounts for approximately 70% of South Asia’s economic output, will lead the economic recovery, while Bangladesh and Iran are also expected to see strong growth. The report notes that there will be “robust external demand” but also “moderate strengthening of domestic consumption and investment” as several countries benefit from improved macroeconomic conditions.
The report also noted that governments in the region have made progress at implementing economic policy reforms, thereby boosting consumer and business confidence.
Pakistan's progress
Due to the precarious security situation in the country, and low fixed investment, the report said, “macroeconomic fundamentals remain fragile” in Pakistan, in spite of the GDP rebounding to an estimated 4.2% in 2014 after robust private and public consumption.
The report forecasts economic growth to fall slightly in 2015, but pick up again in 2016.
In Pakistan, India, Iran and Sri Lanka, unemployment rates remained significantly higher for women, while the share of vulnerable employment, which is defined as unpaid family workers and own-account workers, was 60% in Pakistan and 80% in India.
“This illustrates the magnitude of the employment challenges the region is facing and highlights the importance of generating quality employment,” the report said.