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Economy
Islamabad Stock Exchange
Tower located in the Blue Area.
With a per capita
GDP of about PPP $2,200, the World Bank considers Pakistan a
low-income country. No more than 45.7% of adults are literate, and
life expectancy is about 63 years. The population, currently about
162.4 million, is growing at 2.0% annually.
In 2000, the
government made significant macroeconomic reforms. Privatizing
Pakistan's state-subsidized utilities, instituting a world-class
anti-money laundering law, cracking down on piracy of intellectual
property, and quickly resolving investor disputes would aid
Pakistan's efforts to improve its investment climate. After
September 11, 2001, and Pakistan's proclaimed commitment to
fighting terror, many international sanctions, particularly those
imposed by the United States, were lifted. Pakistan's economic
prospects began to increase significantly due to unprecedented
inflows of foreign assistance at the end of 2001. This trend is
expected to continue through 2009. Foreign exchange reserves and
exports grew to record levels after a sharp decline. The
International Monetary Fund recently lauded Pakistan for its
commitment in meeting lender requirements for a $1.3 billion IMF
Poverty Reduction and Growth Facility loan, which it completed in
2004, forgoing the final permitted tranche. The Government of
Pakistan has been successful in issuing sovereign bonds, and has
issued $600 million in Islamic bonds, putting Pakistan back on the
investment map. Pakistan's search for additional foreign direct
investment has been hampered by concerns about the security
situation, domestic and regional political uncertainties, and
questions about judicial transparency.
U.S. assistance has
played a key role in moving Pakistan's economy from the brink of
collapse to setting record high levels of foreign reserves and
exports, dramatically lowering levels of solid debt. This
encouraged a 6.1% GDP growth in fiscal year 2003-2004 and a
reported GDP increase of over 8% in fiscal year 2004-2005. In
2002, the United States led Paris Club efforts to reschedule
Pakistan's debt on generous terms, and in April 2003 the United
States reduced Pakistan's bilateral official debt by $1 billion.
In 2004, approximately $500 million more in bilateral debt was
granted. In the second half of 2004 and first half of 2005
inflation has been a concern, rising above the historic lows for
inflation in 2004.
Low levels of
spending in the social services and high population growth have
contributed to persistent poverty and unequal income distribution.
The trends of resources being devoted to socioeconomic development
and infrastructure projects have been improving since 2002,
although expenditures remain below global averages. Pakistan's
extreme poverty and underdevelopment are key concerns. The
government has reined in the fiscal mismanagement that produced
massive foreign debt, and officials have committed to using
international assistance--including a major part of the $3 billion
five-year U.S. assistance package--to address Pakistan's long-term
needs in the health and education sectors.
The government
started pursuing market-based economic reform policies in the
early 1980s. These reforms began to take hold in 1988, when the
government launched an ambitious IMF-assisted structural
adjustment program in response to chronic and unsustainable fiscal
and external account deficits. The government began to remove
barriers to foreign trade and investment, reform the financial
system, ease foreign exchange controls, and privatize dozens of
state-owned enterprises.
Although the
economy became more structurally sound, it remained vulnerable to
external and internal shocks, such as in 1992-93, when devastating
floods and political uncertainty combined to depress economic
growth sharply. The Asian financial crisis seriously affected
Pakistan's major markets for its textile exports. During the 1980s
and early 1990s, the economy averaged a growth rate of 6% per
year, but afterwards growth dwindled until 2002. For example,
average real GDP growth from 1992 to 1998 dipped to 4.1% annually.
Economic reform also was set back by Pakistan's nuclear tests in
May 1998, and the subsequent economic sanctions imposed by the
G-7. International default was narrowly averted by the partial
waiver of sanctions and the subsequent reinstatement of Pakistan's
IMF enhanced structural adjustment facility/extended fund facility
in early 1999, followed by Paris Club and London Club
re-scheduling. After taking power in late 1999, President
Musharraf instituted policies to stabilize Pakistan's
macroeconomic situation. Pakistan continues to struggle with these
reforms, having mixed success, especially in reducing its budget
and current account deficits.
The Karachi Stock
Exchange (KSE) enjoyed strong growth from 2003 to early 2005,
before undergoing a market correction of close to 20% of market
capitalization in early 2005. KSE’s market capitalization
rebounded to all time highs in mid-2005. Regulations have been
implemented targeted at the speculative margins-purchasing that
was blamed for volatility in early 2005.
Information
obtained from the US Dept of State Website
Karachi down town (wikipedia) CIA
facts
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Economy -
overview:
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Pakistan, an
impoverished and underdeveloped country, has
suffered from decades of internal political
disputes and low levels of foreign investment.
Between 2001-07, however, poverty levels decreased
by 10%, as Islamabad steadily raised development
spending. Between 2004-07, GDP growth in the 5-8%
range was spurred by gains in the industrial and
service sectors - despite severe electricity
shortfalls - but growth slowed in 2008-09 and
unemployment rose. Inflation remains the top
concern among the public, jumping from 7.7% in
2007 to 20.3% in 2008, and 14.2% in 2009. In
addition, the Pakistani rupee has depreciated
since 2007 as a result of political and economic
instability. The government agreed to an
International Monetary Fund Standby Arrangement in
November 2008 in response to a balance of payments
crisis, but during 2009 its current account
strengthened and foreign exchange reserves
stabilized - largely because of lower oil prices
and record remittances from workers abroad.
Textiles account for most of Pakistan's export
earnings, but Pakistan's failure to expand a
viable export base for other manufactures have
left the country vulnerable to shifts in world
demand. Other long term challenges include
expanding investment in education, healthcare, and
electricity production, and reducing dependence on
foreign donors.
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GDP
(purchasing power parity):
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$432.9 billion
(2009 est.)
country
comparison to the world: 28
$415 billion
(2008 est.)
$400.6 billion
(2007 est.)
note: data
are in 2009 US dollars
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GDP
(official exchange rate):
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$162 billion
(2009 est.)
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GDP - real
growth rate:
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4.3% (2009
est.)
country
comparison to the world: 41
3.6% (2008
est.)
1.6% (2007
est.)
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GDP - per
capita (PPP):
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$2,400 (2009
est.)
country
comparison to the world: 178
$2,300 (2008
est.)
$2,300 (2007
est.)
note: data
are in 2009 US dollars
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GDP -
composition by sector:
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agriculture: 21.6%
industry: 24.3%
services: 54.2%
(2009 est.)
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Labor force:
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53.78 million
country
comparison to the world: 10
note: extensive
export of labor, mostly to the Middle East, and
use of child labor (2009 est.)
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Labor force
- by occupation:
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agriculture: 43%
industry: 20.3%
services: 36.6%
(2005 est.)
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Unemployment
rate:
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14% (2009 est.)
country
comparison to the world: 145
12.6% (2008
est.)
note: substantial
underemployment exists
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Population
below poverty line:
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24% (FY05/06
est.)
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Household
income or consumption by percentage share:
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lowest 10%: 3.9%
highest 10%: 26.5%
(2005)
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Distribution
of family income - Gini index:
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30.6 (FY07/08)
country
comparison to the world: 109
41 (FY98/99)
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Investment
(gross fixed):
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17.4% of GDP
(2009 est.)
country
comparison to the world: 118 |
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Budget:
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revenues: $22.65
billion
expenditures: $30.98
billion (2009 est.)
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Public debt:
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49.3% of GDP
(2009 est.)
country
comparison to the world: 47
53.7% of GDP
(2008 est.)
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Inflation
rate (consumer prices):
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13.6% (2009
est.)
country
comparison to the world: 214
20.3% (2008
est.)
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Central bank
discount rate:
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12.5% (31
December 2009)
country
comparison to the world: 22
15% (31
December 2008)
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Commercial
bank prime lending rate:
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NA%
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Stock of
narrow money:
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$45.8 billion
(31 December 2009)
$41.97 billion
(31 December 2008)
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Stock of
broad money:
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$64.26 billion
(31 December 2009)
$59.62 billion
(31 December 2008)
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Stock of
domestic credit:
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$NA (31
December 2009)
$66.82 billion
(31 December 2008 est.)
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Market value of
publicly traded shares:
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$32.21 billion
(31 December 2009)
country
comparison to the world: 59
$23.49 billion
(31 December 2008)
$70.26 billion
(31 December 2007)
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Agriculture -
products:
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cotton, wheat,
rice, sugarcane, fruits, vegetables; milk, beef,
mutton, eggs
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Industries:
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textiles and
apparel, food processing, pharmaceuticals,
construction materials, paper products,
fertilizer, shrimp
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Industrial
production growth rate:
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-1.9% (2009
est.)
country
comparison to the world: 83 |
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Electricity
- production:
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90.8 billion
kWh (2007 est.)
country
comparison to the world: 33 |
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Electricity
- consumption:
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72.2 billion
kWh (2007 est.)
country
comparison to the world: 37 |
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Electricity
- exports:
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0 kWh (2008
est.)
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Electricity
- imports:
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0 kWh (2008
est.)
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Oil -
production:
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59,140 bbl/day
(2009 est.)
country
comparison to the world: 59 |
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Oil -
consumption:
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373,000 bbl/day
(2009 est.)
country
comparison to the world: 35 |
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Oil -
exports:
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30,090 bbl/day
(2007 est.)
country
comparison to the world: 87 |
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Oil -
imports:
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319,500 bbl/day
(2007 est.)
country
comparison to the world: 33 |
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Oil - proved
reserves:
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436.2 million
bbl (1 January 2010 est.)
country
comparison to the world: 49 |
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Natural gas
- production:
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37.5 billion cu
m (2008 est.)
country
comparison to the world: 23 |
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Natural gas
- consumption:
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37.5 billion cu
m (2008 est.)
country
comparison to the world: 21 |
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Natural gas -
exports:
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0 cu m (2008
est.)
country
comparison to the world: |
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Natural gas -
imports:
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0 cu m (2008
est.)
country
comparison to the world: 105 |
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Natural gas -
proved reserves:
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840.2 billion
cu m (1 January 2010 est.)
country
comparison to the world: 29 |
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Current
account balance:
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-$3.583 billion
(2009 est.)
country
comparison to the world: 164
-$15.66 billion
(2008 est.)
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Exports:
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$18.33 billion
(2009 est.)
country
comparison to the world: 68
$21.21 billion
(2008 est.)
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Exports -
commodities:
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textiles
(garments, bed linen, cotton cloth, yarn), rice,
leather goods, sports goods, chemicals,
manufactures, carpets and rugs
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Exports -
partners:
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US 15.87%, UAE
12.35%, Afghanistan 8.48%, UK 4.7%, China 4.44%
(2009)
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Imports:
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$28.53 billion
(2009 est.)
country
comparison to the world: 59
$38.22 billion
(2008 est.)
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Imports -
commodities:
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petroleum,
petroleum products, machinery, plastics,
transportation equipment, edible oils, paper and
paperboard, iron and steel, tea
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Imports -
partners:
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China 15.35%,
Saudi Arabia 10.54%, UAE 9.8%, US 4.81%, Kuwait
4.73%, Malaysia 4.43%, India 4.02% (2009)
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Reserves of
foreign exchange and gold:
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$13.77 billion
(31 December 2009 est.)
country
comparison to the world: 63
$8.903 billion
(31 December 2008 est.)
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Debt -
external:
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$53.62 billion
(31 December 2009 est.)
country
comparison to the world: 52
$49.34 billion
(31 December 2008 est.)
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Stock of
direct foreign investment - at home:
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$28.09 billion
(31 December 2009 est.)
country
comparison to the world: 61
$25.7 billion
(31 December 2008 est.)
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Stock of
direct foreign investment - abroad:
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$1.017 billion
(31 December 2009 est.)
country
comparison to the world: 73
$1.031 billion
(31 December 2008 est.)
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Exchange
rates:
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Pakistani
rupees (PKR) per US dollar - 81.41 (2009), 70.64
(2008), 60.6295 (2007), 60.35 (2006), 59.515
(2005)
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