CPEC, macroeconomic environment contribute in Pakistan’s investment
WASHINGTON: The China-Pakistan Economic Corridor infrastructure projects and a stable macroeconomic environment is contributing to an increase in private investment in Pakistan, a latest World Bank report said, forecasting the economic growth to remain steady.
According to the World Bank’s June 2017 Global Economic Prospects, favorable weather and increased cotton prices are supporting agriculture production and the CPEC infrastructure projects as well as firm macroeconomic environment is contributing to an increase in private investment.
The report noted that agriculture output recovered following the end of a drought, while the successful completion of an IMF-supported program enhanced macroeconomic conditions and foreign direct investment.
The World Bank report said that Pakistan’s growth is expected to increase to 5.2 percent in the current financial year and remain strong over the forecast horizon, reflecting an upturn in private investment, expanded energy supply an improve security.
In the South Asian region as a whole, output expanded by an estimated 6.7 percent in 2016.
In general, the report said, South Asian economies benefitted from low oil prices, an improvement in exports, infrastructure spending, and supportive macroeconomic policies last year. A pickup in regional growth is underway in 2017.
Growth in South Asia remains strong, with regional output projected to grow by 6.8 percent in 2017 and an average of 7.2 percent in 2018-19. Excluding India, growth is projected to average 5.8 percent in 2017-2019, with some cross-country variation.
The report said that inflation has remained gracious, fluttering below target in Pakistan, Bangladesh and India while favorable weather in Pakistan and India and lower oil prices have helped keep inflation low, and thereby made possible an accommodative monetary policy.
Global growth is projected to accelerate to 2.7 percent in 2017, up from a post-crisis low of 2.4 percent in 2016, before strengthening further to 2.9 percent in 2018-19, broadly in line with January projections.