In view of Pakistan’s deteriorating economic condition, the World Bank (WB) has slashed the country’s GDP growth to only 2 percent in the current fiscal year, cutting its forecast by 50 percent.
According to WB’s latest Global Economics Prospects report, the 2022 devastating floods and slowdown in global growth have contributed to what it termed as “sharp, long-lasting slowdown”.
Due to the global growth frozen at only 1.7 percent this year, Pakistan’s overall rate will also be much slower and will stand at only 2 percent points from its June 2022 estimates.
“Pakistan’s economic output was not only declining itself but also bringing down the regional growth rate. Pakistan’s GDP growth rate may improve to 3.2 percent in 2024, but that too would be lower than the earlier estimates of 4.2 percent,” said the report.
“Policy uncertainty further complicates the economic outlook of Pakistan in addition to flood damages and resultant increase in poverty.”
The report further said that global growth was slowing sharply in the face of elevated inflation, higher interest rates, reduced investment, and disruptions caused by Russia’s ongoing invasion of Ukraine.