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@Yankeestani good news for PTI government.
ISLAMABAD:
The economy has sprung a surprise, growing nearly 4% in the outgoing fiscal year on the back of a healthy momentum in all main sectors. The unexpected economic activity beats expectations of the government and the international financial institutions by a wide margin.
The provisional Gross Domestic Product (GDP) growth rate of 3.94% is almost double than the official target of 2.1%. But it was a surprise even for the State Bank of Pakistan and the Ministry of Finance which initially termed the figure unrealistically high during a meeting convened to approve the growth figure.
The 4% growth rate was higher than the SBP’s estimates of 3% and the IMF’s projection of 2% for this fiscal year. The World Bank, too, had predicted a GDP growth rate of no more than 1.5%.
The 103rd meeting of the National Accounts Committee (NAC) approved provisional estimates of 3.94% of the GDP, announced the Ministry of Planning and Development after the meeting. Planning Secretary Hamid Yaqoob Sheikh chaired the NAC meeting –a body having representation of all the stakeholders.
In the last fiscal year, the economy had contracted to 0.5%.
The agriculture sector maintained its last year growth rate of 2.8% but the industrial and services sectors surpassed the annual targets with wide margins amid shocks to business activities from the third wave of the Covid-19.
Read: Debt-to-GDP ratio stands at 87%, NA told
“The per capita income in dollar terms has increased by 13.4% from $1,361 a year ago to $1,543 in 2020-21 due to strengthening of the rupee,” tweeted Minister for Planning Asad Umar after the meeting.
He said the size of the economy also increased from $263 billion last year to $296 billion this year, implying an increase of $33 billion in a single year which is the highest ever.
At the end of the PML-N tenure, the economic growth rate was 5.5% and the size of the economy in dollar terms was $313 billion – a figure that the PTI could not touch even after three years.
SBP-MOF objects
Sources told The Express Tribune that earlier representatives of the Ministry of Finance Dr Imtiaz Ahmed and the SBP chief economic Dr Mohammad Ali raised objections to the Pakistan Bureau of Statistics’ (PBS) provisional growth figure of 3.94% at the Friday meeting.
They said the SBP was of the view that according to its macroeconomic modeling, the growth was around 3%.
The Ministry of Finance representative stated that the 13.8% growth in the gross fixed capital formation was not sufficient to support the 4% economic growth rate.
They said the Ministry of Finance also raised the question about the impact of foreign remittances on consumption and investments.
Due to disagreement, the meeting ended inconclusively and was reconvened again after two hours. But during the break, the Ministry of Finance representative received instructions from the top bosses to withdraw objections, said the sources.
Planning Commission spokesperson Zafarul Hasan Almas told The Express Tribune that the SBP’s objections were more related to a set of agriculture production data.
The 27.3 million tons wheat production figure that the NAC approved was higher than 26.04 m metric tons approved by the Federal Committee on Agriculture.
The sources said a non-elected cabinet member had asked the PBS this week to show a growth rate of over 4%. The PBS representative had initially resisted that the growth rate would be less than 3.5%. However, eventually the 4% economic growth rate was presented before the NAC on Friday.
The NAC slightly downward revised the economic growth figure for the last fiscal year 2019-20 to negative 0.5% and for the first year of the PTI government the figure was adjusted upward to 2.1%.
Full article here https://tribune.com.pk/story/2301031/4-gdp-growth-beats-gloomy-forecasts
ISLAMABAD:
The economy has sprung a surprise, growing nearly 4% in the outgoing fiscal year on the back of a healthy momentum in all main sectors. The unexpected economic activity beats expectations of the government and the international financial institutions by a wide margin.
The provisional Gross Domestic Product (GDP) growth rate of 3.94% is almost double than the official target of 2.1%. But it was a surprise even for the State Bank of Pakistan and the Ministry of Finance which initially termed the figure unrealistically high during a meeting convened to approve the growth figure.
The 4% growth rate was higher than the SBP’s estimates of 3% and the IMF’s projection of 2% for this fiscal year. The World Bank, too, had predicted a GDP growth rate of no more than 1.5%.
The 103rd meeting of the National Accounts Committee (NAC) approved provisional estimates of 3.94% of the GDP, announced the Ministry of Planning and Development after the meeting. Planning Secretary Hamid Yaqoob Sheikh chaired the NAC meeting –a body having representation of all the stakeholders.
In the last fiscal year, the economy had contracted to 0.5%.
The agriculture sector maintained its last year growth rate of 2.8% but the industrial and services sectors surpassed the annual targets with wide margins amid shocks to business activities from the third wave of the Covid-19.
Read: Debt-to-GDP ratio stands at 87%, NA told
“The per capita income in dollar terms has increased by 13.4% from $1,361 a year ago to $1,543 in 2020-21 due to strengthening of the rupee,” tweeted Minister for Planning Asad Umar after the meeting.
He said the size of the economy also increased from $263 billion last year to $296 billion this year, implying an increase of $33 billion in a single year which is the highest ever.
At the end of the PML-N tenure, the economic growth rate was 5.5% and the size of the economy in dollar terms was $313 billion – a figure that the PTI could not touch even after three years.
SBP-MOF objects
Sources told The Express Tribune that earlier representatives of the Ministry of Finance Dr Imtiaz Ahmed and the SBP chief economic Dr Mohammad Ali raised objections to the Pakistan Bureau of Statistics’ (PBS) provisional growth figure of 3.94% at the Friday meeting.
They said the SBP was of the view that according to its macroeconomic modeling, the growth was around 3%.
The Ministry of Finance representative stated that the 13.8% growth in the gross fixed capital formation was not sufficient to support the 4% economic growth rate.
They said the Ministry of Finance also raised the question about the impact of foreign remittances on consumption and investments.
Due to disagreement, the meeting ended inconclusively and was reconvened again after two hours. But during the break, the Ministry of Finance representative received instructions from the top bosses to withdraw objections, said the sources.
Planning Commission spokesperson Zafarul Hasan Almas told The Express Tribune that the SBP’s objections were more related to a set of agriculture production data.
The 27.3 million tons wheat production figure that the NAC approved was higher than 26.04 m metric tons approved by the Federal Committee on Agriculture.
The sources said a non-elected cabinet member had asked the PBS this week to show a growth rate of over 4%. The PBS representative had initially resisted that the growth rate would be less than 3.5%. However, eventually the 4% economic growth rate was presented before the NAC on Friday.
The NAC slightly downward revised the economic growth figure for the last fiscal year 2019-20 to negative 0.5% and for the first year of the PTI government the figure was adjusted upward to 2.1%.
Full article here https://tribune.com.pk/story/2301031/4-gdp-growth-beats-gloomy-forecasts
