Growth will moderate to 4.7 percent in 2019: IMF

International Monetary Fund (IMF) has stated that Pakistan''s economy is expected to expand at a robust pace of 5.6 percent this year 2018 before moderating to 4.7 percent in 2019, partly reflecting an increase in macroeconomic vulnerabilities. The IMF report ''World Economic Outlook (WEO), Cyclical Upswing, Structural Change'' has projected an increase in the inflation rate. The consumer price is expected to be 5 percent during the current year 2018, up from 4.1 percent last year (2017), but the rate may further increase to 5.2 percent in 2019.
Pakistan''s economy is expected to expand at a robust pace of 5.6 percent this year 2018 (up from 5.3 percent in 2017), before moderating to 4.7 percent in 2019. While the forecast for 2018 is unchanged relative to the October WOE for 2019, it has been revised downward by 1.3 percentage points, partly reflecting an increase in macroeconomic vulnerabilities, the IMF further stated.
The Middle East, North Africa, Afghanistan and Pakistan region continues to grapple with high inflation stemming from the pass-through of earlier exchange rate depreciations. The IMF report has also projected a slight raise in unemployment ratio for Pakistan from 6 percent in 2017 to 6.1 percent in 2018. Unemployment ratio has been projected to be 6.1 percent in 2019.
The current account balance is forecast at negative 4.8 percent and negative 4.4 percent for 2018 and 2019 respectively against negative 4.1 percent in 2017. Per capita growth in Pakistan is projected to fall short of or barely exceed that in advanced economies over the next few years, reflecting the weak performance of many commodity exporters in these regions.
In the Middle East, North Africa, Afghanistan, and Pakistan region, growth is projected to increase from 2.6 percent in 2017 to 3.4 percent in 2018 and 3.7 percent in 2019. Growth is expected to stabilize thereafter at about 3.6 percent through the medium-term. The need for fiscal consolidation as a result of structurally lower oil revenues, security challenges, and structural impediments weigh on the medium-term prospects for many economies in the region.