IMF projects 3.2pc growth

ISLAMABAD: The International Monetary Fund (IMF) has projected GDP growth rate for Pakistan at 3.2 percent for fiscal year 2025 against 2.4 percent in fiscal year 2024.

The Fund in its latest report, “World Economic Outlook (WEO): Policy Pivot, Rising Threats”, released on Tuesday noted that Pakistan’s GDP is projected to be 3.2 per cent in fiscal year 2025 against 2.4 per cent in 2024.

The Fund had projected GDP growth for Pakistan at 3.5 per cent for fiscal year 2025 in the WEO update released in July 2024.

Pakistan’s economy to grow at 3.2%, face 9.2% inflation, projects IMF

World Bank has estimated Pakistan GDP growth at 2.8 per cent in fiscal year 2025 (lowest in the region) against 2.5 per cent in 2024.Asian Development Bank (ADB) has maintained GDP growth projection for Pakistan at 2.8 per cent.

The Fund has projected inflation rate at 9.5 per cent for 2025 against 23.4 per cent in 2024. However, the report has projected consumer prices for the end of period of 2025 at 10.6 per cent against 12.6 per cent in 2024.

The current account balance is projected at negative0.9 per cent for 2025 compared to negative 0.2 per cent for 2024.

The Fund has projected a decrease in unemployment in Pakistan to 7.5 per cent in 2025 compared to 8 per cent in 2024.

The report noted that global growth is expected to remain stable yet underwhelming. At 3.2 per cent in 2024 and 2025, the growth projection is virtually unchanged from those in both the July 2024 World Economic Outlook Update and the April 2024 World Economic Outlook. However, notable revisions have taken place beneath the surface, with upgrades to the forecast for the United States offsetting downgrades to those for other advanced economies—in particular, the largest European countries.

Likewise, in emerging market and developing economies, disruptions to production and shipping of commodities—especially oil—conflicts, civil unrest, and extreme weather events have led to downward revisions to the outlook for the Middle East and Central Asia and that for sub-Saharan Africa.

These have been compensated for by upgrades to the forecast for emerging Asia, where surging demand for semiconductors and electronics, driven by significant investments in artificial intelligence, has bolstered growth.

The latest forecast for global growth five years from now––at 3.1 per cent—remains mediocre compared with the pre-pandemic average. Persistent structural headwinds—such as population aging and weak productivity—are holding back potential growth in many economies, it added.

Copyright Business Recorder, 2024