Pakistan’s current account posts significant surplus of $397mn in December

Pakistan’s current account posted a significant surplus of $397 million in December 2023, in stark contrast to a deficit of $15 million recorded in November, revealed data released by the State Bank of Pakistan (SBP) on Wednesday.

The surplus comes amid an increase in the country’s exports and remittances, while imports posted a marginal decline.

Pakistan posted a current account deficit of $365 million in December 2022.

As per the central bank data, the country’s exports (goods and services) increased to $3.526 billion in December 2023 against $3.089 billion in December 2022, a jump of over 14%.

Meanwhile, the country’s remittances stood at $2.38 billion in December 2023, in comparison to $2.1 billion in the same month of the previous year, an increase of 13%.

Pakistan’s current account posts surplus of $9mn in November

On the other hand, total imports were down by 2% to $4.97 billion in December 2023 against $4.98 billion in the same period last year.

July-December

According to the SBP, Pakistan posted a current account deficit of $831 million in July-December of FY24 as compared to a deficit of $3.63 billion during the same month of last fiscal year (FY23), a massive decline of over $2.8 billion or 77%.

The central bank, in its latest Monetary Policy Committee (MPC) meeting held on December 12, noted a substantial improvement in the current account balance, as the deficit narrowed by 65.9% year-on-year to $1.1 billion during Jul-Oct FY24.

The current account is a key figure for cash-strapped Pakistan which relies heavily on imports to run its economy. A widening deficit puts pressure on the exchange rate and drains official foreign exchange reserves.