IMF lowers economic growth projections for Pakistan

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New report predicts 0.1 per cent GDP growth for 2014, 0.4 per cent for 2015

The International Monetary Fund (IMF) on Tuesday lowered its forecast for Pakistan’s Gross Domestic Production (GDP) for the current year by 0.1 and 0.4 per cent for the 2015.

Earlier IMF had predicted that the average GDP growth for 2014 and 2015 of Pakistan, Afghanistan, Middle East and North Africa to be 3.3 and 4.8, which it revised on Tuesday to 3.2 for 2014 and 4.4 for the year 2015.

The IMF report acknowledged that the manufacturing sector in Pakistan recovered faster than it was expected on the back of improved electricity supply and recent exchange rate depreciation. But this positive development was offset by weak cotton production.

The real GDP growth rate which was 3.6 in the year 2013 is projected at 3.1 and 3.7 per cent for the year 2014 and 2015 respectively.

The report forecast the current account deficit for Pakistan for current and next year at 0.9 and 1.0 per cent, which was one per cent in the previous year.

According to the IMF report, unemployment rate is also expected to rise to 6.9 per cent in 2014 and 7.2 per cent in 2015, which was 6.7 in 2013. IMF has also lowered its overall projection for the world economic growth this year and next year, reflecting slowing activity in the emerging and developing economies.