ISLAMABAD: Prime Minister Imran Khan on Tuesday expressed satisfaction that Pakistan’s economy has finally headed towards “right direction” as current account rises into surplus after 4 years.
In a tweet shared on his official Twitter handle, the premier stated that Pakistan’s current account turned positive into surplus in October 2019, for the first time after a gap of four years.
Pak economy finally heading in right direction as more of our economic reforms bear fruit: Pak's current account turned into surplus in Oct 2019, for first time in 4 yrs. Current account balance was +$99 mn in Oct 2019 compared to -$284 mn in Sept 2019 & -$1,280 mn in Oct 2018
— Imran Khan (@ImranKhanPTI) November 19, 2019
“Current account balance was +$99 million in Oct. 2019 [as] compared to -$284 million in Sept. 2019 [and] -$1,280 million in Oct. 2018,” he stated.
Pak economy finally heading in right direction as more of our economic reforms bear fruit: Pak s current account turned into surplus in Oct 2019, for first time in 4 years. Current account balance was +$99 million in Oct 2019 compared to -$284 million in Sept 2019 & -$1,280 million in Oct 2018
In another tweet, he mentioned that for the first four months (Jul-Oct) of the current fiscal year, the current account deficit has fallen by 73.5 per cent as compared to the same period of previous year. He referred to the data of the State Bank of Pakistan (SBP).
For first 4 months of our fiscal year our current account deficit has fallen by 73.5 % compared to same period last fiscal yr. Our exports of goods & services in Oct 2019 rose 20% over previous month and 9.6% over Oct 2018. I congratulate our exporters & encourage them to do more
— Imran Khan (@ImranKhanPTI) November 19, 2019
In four months (Jul-Oct) of the FY20, the current account recorded a deficit of around $1.47 billion. It was 73.5% lower than the deficit of $5.56 billion in the same period of previous year. The deficit sharply reduced in the last four months reflecting significant improvement on the economy’s external front.
The primary reason of the surprising change in the state’s current account balance was observed as the inflow of foreign currencies surpassed the outflow by $99 million in Oct. due to a notable reduction in imports and firm worker remittances.
A continued reduction in imports due to the implementation of structural reforms like rupee depreciation, high benchmark lending rate and regulatory duty on imports had raised hopes for a further drop in the current account deficit in October.
The latest data released by the State Bank of Pakistan (SBP) showed the government has succeeded in bringing down the current account deficit.
The details showed the deficit fell drastically due to sharp decrease in imports, which fell to $14.65 billion from $19bn in the same period last fiscal year. However, exports of goods increased to $8.22 billion compared to $7.9bn in the last fiscal year.
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The country’s current account deficit, in the last fiscal year, clocked in at $12.75 billion, down 36 per cent from record-high $19.9 billion in FY18.
Moreover, it has been observed that the trade deficit fell to $6.4 billion compared to $11 billion during the period under review. However, trade of services during the period under review did not show any significant change when compared to same period last fiscal year.(With additional input from INP)
