Pakistan: navigating uncertainty

Published 18 December 2023

Pakistan continues to face political and economic uncertainty, while the government has to find solutions to the impact of flood damage caused by last year’s devastating monsoon. The cement sector is in a capacity expansion cycle, but domestic sales have been on a downward trend, while prices have risen steeply to match coal price increases.  

Pakistan has seen slowing economic growth and political uncertainty in recent years,

while relief efforts following devastating floods continue  (© ibrar.kunri)

Pakistan’s economic growth has slowed in recent years due to measures taken by the authorities to address macroeconomic imbalances. GDP declined by 0.9 per cent in 2020 following the aftermath of the COVID-19 shock, before rebounding by 5.8 per cent the following year. Growth picked up in 2022 to 6.1 per cent despite disruptions caused by the devastating floods experienced during the year, a tight monetary stance, high inflation (averaging 12.1 per cent)and a less favourable global economic environment. A  strong inflow of remittances (approximately 10 per cent of GDP) supported private consumption.

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