Country’s trade deficit down by 5.68% in July-Feb

[Naveed Yaseen]

By Sajid Chaudhry

ISLAMABAD: The country’s trade deficit went down by 6.68 percent in July-Feb of the current fiscal year despite slowdown in the global economy, sliding trend in aggregate demand in economy and depreciation of Pak rupee.

Country’s trade deficit has been recorded at $11.621 billion in first eight months (July-February) of 2008-09 as compared to a deficit of $12.477 billion in the same period last fiscal year 2007-08, indicating a decline of 6.86 percent.

Export (July-February): According to the official data released by the Federal Bureau of Statistics (FBS) Monday has revealed Pakistan’s exports amounted to $12.156 billion in July-Feb period of current fiscal year as compared to the exports of $11.660 billion in the same period of last fiscal year, projecting an increase of 4.2 percent.

According to the budgetary target, the exports of the country were targeted to grow by 16.5 percent in the current fiscal year to meet the annual exports target of $21.2 billion, however, recently revision in Macro-Economic targets exports growth has been projected at negative -5.5 percent, actually admitting failure in meeting export target.

Import (July-February): However, due to the low import demand in advanced economies, unprecedented power and gas loadshedding, depreciation of Pak rupee, increase in cost of capital as well as production and capacity constraints are instrumental in low growth of country’s exports, said an official at Ministry of Commerce. Similarly, around 95 percent contribution to imports during first half came from petroleum, fertiliser and wheat imports.

Country’s imports have witnessed decline by 1.49 percent and amounted to $23.777 billion in eight months as against the total imports of $24.137 billion in same period last fiscal year.

Drop in aggregate demand in economy can be witnessed by decrease in imports from 12.8 percent growth in first six months to a negative growth of 1.49 percent in Jul-February period. This clearly shows that State Bank of Pakistan and government’s steps are now yielding results and it is hoped that demand in economy would go down further in months to come, an official said.

Comparison February 2009 over January 2009: Country has exported goods worth $1.266 billion in February 2009 as compared to exports of $1.360 billion in January 2009 showing decline of 6.94 percent.

Imports amounted to $2.123 billion in February 2009 as against imports of $2.528 billion in January 2009 indicating a decrease of 16.02 percent. Trade deficit was at $857.247 million in February 2009 as against deficit of $1.167 billion indicating a major decline of 26.59 percent.

Comparison February 2009-February 2008: Exports of the country registered a decline of 17.68 percent in February 2009 with total exports of $1.266 billion as against exports of $1.538 billion in February 2008.

Imports of the country witnessed a decline of 41.95 percent in February 2009 with total imports at $2.133 billion as against the imports of $3.657 billion in February 2008.

Trade deficit in February 2009 declined by 59.56 percent with total deficit at $857.247 billion as against the deficit of $2.119 million in February 2008.

http://www.dailytimes.com.pk/default.asp...2009_pg5_1